What happened
Shares of Torrid Holdings (CURV -0.80%), a retailer of plus-size women's apparel, were surging today after the company posted strong results in its first quarterly report as a publicly traded company.
As of 1:08 p.m. EDT, the stock was up 30.4%.
Image source: Getty Images.
So what
The company said that revenue in the quarter was up 34% from last year, or 29% from the second quarter in 2019, to $332.9 million, which easily beat the analyst consensus at $278.1 million. Comparable-store sales rose 30%, showing strong growth in its existing store base and through the e-commerce channel. Profitability also jumped as it lapped the headwinds from the pandemic quarter a year ago.
Gross margin was 45%, which compared to 32.1% in the second quarter in 2020 and 39% in the same period in 2019. Gross profit increased 87% from the prior year and 46% from 2019 to $149.7 million.
On an adjusted basis, earnings per share jumped from $0.08 to $0.36, which was well ahead of estimates at $0.13.
CEO Liz Munoz said, "We attribute the strength of our brand to our maniacal focus on both fit and on delivering an incredible customer experience that underscores our commitment to an underserved market. At Torrid, we aim to be the best direct-to-consumer apparel and intimates brand for women sizes 10 to 30, and we are uniquely positioned to serve this customer in a way she has never before experienced."
Now what
Management's full-year guidance was also strong, calling for revenue of $1.29 billion to $1.31 billion, or 33% growth at the midpoint, which was above expectations at $1.26 billion. The company also forecast adjusted EBITDA of $248 million to $258 million, indicating wide profit margins.
Like other apparel stocks, Torrid is benefiting from a strong rebound in clothing sales after a challenging 2020, but the company's focus on the underserved plus-size market and strength in e-commerce make it an intriguing choice in apparel retail, especially with its high growth rate this year.
Following its June IPO, shares have been volatile, but this one is worth keeping an eye on over the coming months.
