This is a smart cost-effective approach that finds it waist-deep in its fourth consecutive year of profitability. Social media celebrities with tons of followers are paid to promote Revolve apparel items, and in a few cases even inspire and brand them. One thing that sets Revolve Group apart is that, instead of traditional online advertising, it keeps a growing army of fashion-forward influences on its payroll. The rub here is that analysts are already modeling top-line results north of $606 million, so they're already at the high end of that range. It's already at the high end of that range through the first half of the year so the assumption here is that growth will decelerate off of the second quarter's 23% pace. Revolve Group's guidance for all of 2019 calls for $598 million to $608 million in net sales, growth of 20% to 22%. We now know that the peak quarter was mixed, and we'll have to wait a year to see Revolve Group at its best again. Revolve Group hosts the #REVOLVEfestival in April, and that event is potent enough to lift sales even above what it rakes in during the holiday shopping season two quarters later. Revolve Group's strongest quarter in terms of net sales - at least in 20 - has been the second quarter. This is a seasonal business, but not in the way that you probably think a retailer would peak. However, since investors are marching to the expectations of analysts and one of the stock's selling points is its profitability, it's easy to see why the stock stumbled after falling short on the bottom line. Revolve Group didn't put out guidance for the current quarter in its early June prospectus, so technically Wall Street is the one that missed. However, the $0.18 a share it posted was less than the $0.19 a share that Wall Street pros were expecting. One thing that sets Revolve Group apart from the faster growing IPOs of 2019 is that it's profitable, a welcome byproduct of its clever business model. Things didn't quite work out the same way at the other end of the income statement. Analysts were settling for $159.9 million in net sales for the second quarter, matching the first quarter's 21% ascent. After seeing net sales soar 28% in 2017 before slowing to a 25% clip last year and 21% through the first three months of the year, it's actually encouraging to see acceleration. The next-gen fashion retailer for millennials and Generation Z members saw its net sales climb 23% to hit $161.9 million. Revolve Group landed ahead of where analysts were parked with its top-line results, but it failed to deliver on the bottom line. When the time comes to step up with its first financial report as a public company it can't come up short.
Miss once and the market won't miss youĪ cardinal rule with any IPO is that it can't stumble out of the gate.
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