Revolve Group, Inc., an online fashion retailer headquartered in Los Angeles, has announced impressive financial results for the fourth quarter of 2020. The company’s net income for Q4 reached $19.0 million, a significant increase of 126% compared to the same period in the previous year when it stood at $8.4 million. Diluted earnings per share also witnessed a significant surge, rising 117% from $0.12 to $0.26.

Although Revolve’s total net sales for the fourth quarter saw a slight decline of 5% to $140.8 million compared to the previous year’s $147.6 million, international sales bucked the trend and grew by 24%. This growth was primarily fueled by double-digit increases in key markets such as Australia, Canada, Greater China, and the Middle East. However, the company experienced a 10% decline in domestic sales, counterbalancing the overall progress.

The Revolve segment of the company’s business witnessed a 5% drop in net sales, reaching $118.9 million, while the Forward segment experienced a decrease of 2.3% to $21.8 million. Revolve’s gross margin increased to 56.0%, reflecting a 305 basis point improvement compared to the previous year. This improvement was attributed to better inventory management, resulting in higher net sales at full price and reduced markdowns.

Michael Mente, co-founder, and co-CEO of Revolve, expressed pride in the highly profitable fourth quarter, considering the challenging circumstances posed by the Covid-19 pandemic. He attributed the record net income and cash flow generation to the team’s agility and resilience. In the entirety of 2020, Revolve’s net sales amounted to $580.6 million, representing a 3% decrease from the previous year. However, net income for the year grew by a notable 59%, reaching $56.8 million.

Looking towards the future, Mike Karanikolas, co-founder, and co-CEO of Revolve, emphasized the company’s strong position to benefit from the reopening of economies, enabling customers to once again embrace the active social lifestyle associated with the brand. With the company’s cash position more than doubling in 2020 and a clean inventory for 2021, Revolve is well-positioned to capitalize on the promising opportunities that lie ahead.

Since the conclusion of 2020, Revolve has experienced low single-digit percentage growth in net sales over a seven-week period. This growth can be attributed to strong international gains and improved performance in the United States. Despite the challenges posed by the ever-changing retail landscape, Revolve remains optimistic about the future and is confident in its ability to thrive.

Useful links:
1. [Revolve Group, Inc. website](https://www.revolve.com/)
2. [Revolve Group, Inc. investor relations](https://investors.revolve.com/home/default.aspx)