Torrid (CURV) Q1 2026 earnings summary

Executive summary

• Q1 2025 net sales were $266 million, down 4.9% year-over-year, with adjusted EBITDA of $27.1 million at the high end of guidance and net income of $5.9 million, reflecting lower sales and higher marketing expenses.

• Sub-brands outperformed expectations, driving new and younger customer acquisition and higher margins, and are expected to comprise nearly a third of business by 2026.

• Accelerated store optimization with plans to close up to 180 underperforming stores in 2025, shifting focus to digital channels, with store count reduced to 632.

• Digital channel now accounts for nearly 70% of total demand, expected to reach 75% by 2026.

• Strategic pause of China-sourced footwear business due to sourcing and tariff impacts, resulting in $40–$45 million revenue loss but neutral EBITDA impact.

Financial highlights

• Gross profit: $101.4 million (38.1% margin), down from $115.4 million (41.3%) last year, impacted by lower sales and promotional activity.

• SG&A reduced by $6.5 million to $70 million, leveraging 100 basis points to 26.3% of sales; marketing expenses rose 19.9% to $15.4 million.

• Net income: $5.9 million ($0.06/share) vs. $12.2 million ($0.12/share) prior year.

• Adjusted EBITDA: $27.1 million (10.2% margin) vs. $38.2 million (13.7%) last year.

• Cash and cash equivalents: $23.7 million; total liquidity: $141 million; net debt: $284.5 million.

Outlook and guidance

• FY25 net sales expected at $1.03–$1.055 billion, reflecting $40–$45 million impact from paused footwear; adjusted EBITDA guidance: $95–$105 million, including $20 million in tariff headwinds offset by expense reductions.

• Q2 guidance: net sales $250–$265 million, adjusted EBITDA $18–$24 million.

• Expect 150–250 basis points of EBITDA margin expansion in FY26 from store optimization.

• Capex for FY25: $10–$15 million, focused on digital, tech, store refreshes, and fulfillment.

• Management expects cash from operations and available borrowings to be sufficient for at least the next 12 months.