Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2022 | Apr. 26, 2022 | |
Document And Entity Information [Line Items] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Mar. 31, 2022 | |
Document Fiscal Year Focus | 2022 | |
Document Fiscal Period Focus | Q1 | |
Trading Symbol | RVLV | |
Entity Registrant Name | REVOLVE GROUP, INC. | |
Entity Central Index Key | 0001746618 | |
Entity Current Reporting Status | Yes | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Interactive Data Current | Yes | |
Entity Shell Company | false | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity File Number | 001-38927 | |
Entity Tax Identification Number | 46-1640160 | |
Entity Address, Address Line One | 12889 Moore Street | |
Entity Address, City or Town | Cerritos | |
Entity Address, State or Province | CA | |
Entity Address, Postal Zip Code | 90703 | |
City Area Code | 562 | |
Local Phone Number | 677-9480 | |
Title of 12(b) Security | Class A Common Stock, par value $0.001 per share | |
Security Exchange Name | NYSE | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Entity Incorporation, State or Country Code | DE | |
Class A Common Stock | ||
Document And Entity Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 40,711,048 | |
Class B Common Stock | ||
Document And Entity Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 32,597,119 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands | Mar. 31, 2022 | Dec. 31, 2021 |
Current assets: | ||
Cash and cash equivalents | $ 270,607 | $ 218,455 |
Accounts receivable, net | 11,386 | 4,639 |
Inventory | 179,245 | 171,259 |
Income taxes receivable | 466 | 3,375 |
Prepaid expenses and other current assets | 58,127 | 42,114 |
Total current assets | 519,831 | 439,842 |
Property and equipment (net of accumulated depreciation of $10,418 and $9,347 as of March 31, 2022 and December 31, 2021, respectively) | 8,867 | 8,946 |
Right-of-use lease assets | 16,618 | 6,566 |
Intangible assets, net | 1,259 | 1,212 |
Goodwill | 2,042 | 2,042 |
Other assets | 3,107 | 2,746 |
Deferred income taxes | 19,059 | 19,059 |
Total assets | 570,783 | 480,413 |
Current liabilities: | ||
Accounts payable | 75,126 | 54,345 |
Income taxes payable | 2,761 | |
Accrued expenses | 40,622 | 33,899 |
Returns reserve | 69,626 | 49,296 |
Current lease liabilities | 3,829 | 3,766 |
Other current liabilities | 25,207 | 18,916 |
Total current liabilities | 217,171 | 160,222 |
Non-current lease liabilities | 13,114 | 3,177 |
Total liabilities | 230,285 | 163,399 |
Stockholders' equity: | ||
Additional paid-in capital | 105,206 | 103,590 |
Retained earnings | 235,218 | 213,351 |
Total stockholders' equity | 340,498 | 317,014 |
Total liabilities and stockholders’ equity | 570,783 | 480,413 |
Common Class A | ||
Stockholders' equity: | ||
Common stock value | 41 | 40 |
Common Class B | ||
Stockholders' equity: | ||
Common stock value | $ 33 | $ 33 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) (Unaudited) - USD ($) $ in Thousands | Mar. 31, 2022 | Dec. 31, 2021 |
Property and equipment, accumulated depreciation | $ 10,418 | $ 9,347 |
Common Class A | ||
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 1,000,000,000 | 1,000,000,000 |
Common stock, shares issued | 40,538,314 | 40,276,417 |
Common stock, shares outstanding | 40,538,314 | 40,276,417 |
Common Class B | ||
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 125,000,000 | 125,000,000 |
Common stock, shares issued | 32,760,535 | 32,956,904 |
Common stock, shares outstanding | 32,760,535 | 32,956,904 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Income (Unaudited) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Income Statement [Abstract] | ||
Net sales | $ 283,498 | $ 178,907 |
Cost of sales | 129,087 | 82,242 |
Gross profit | 154,411 | 96,665 |
Operating expenses: | ||
Fulfillment | 7,290 | 4,367 |
Selling and distribution | 46,586 | 24,977 |
Marketing | 45,250 | 26,228 |
General and administrative | 26,835 | 19,878 |
Total operating expenses | 125,961 | 75,450 |
Income from operations | 28,450 | 21,215 |
Other (income) expense, net | (516) | 233 |
Income before income taxes | 28,966 | 20,982 |
Provision for (benefit from) income taxes | 6,398 | (1,270) |
Net income | $ 22,568 | $ 22,252 |
Earnings per share of Class A and Class B common stock: | ||
Basic | $ 0.31 | $ 0.31 |
Diluted | $ 0.30 | $ 0.30 |
Weighted average number of shares of Class A and Class B common stock outstanding: | ||
Basic | 73,264 | 71,782 |
Diluted | 74,803 | 74,033 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Comprehensive Income (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Statement of Comprehensive Income [Abstract] | ||
Net income | $ 22,568 | $ 22,252 |
Other comprehensive (loss) income: | ||
Cumulative translation adjustment | (701) | 104 |
Total other comprehensive (loss) income | (701) | 104 |
Total comprehensive income | $ 21,867 | $ 22,356 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Operating activities: | ||
Net income | $ 22,568 | $ 22,252 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 1,102 | 1,149 |
Equity-based compensation | 1,491 | 976 |
Deferred income taxes | 2,423 | |
Changes in operating assets and liabilities: | ||
Accounts receivable | (6,747) | (1,963) |
Inventories | (7,986) | (5,183) |
Income taxes receivable | 2,909 | (4,700) |
Prepaid expenses and other current assets | (16,013) | (5,813) |
Other assets | (361) | (2,346) |
Accounts payable | 20,781 | 10,349 |
Income taxes payable | 2,761 | 637 |
Accrued expenses | 6,723 | 1,016 |
Returns reserve | 20,330 | 11,869 |
Right-of-use lease assets and current and non-current lease liabilities | (52) | (222) |
Other current liabilities | 6,291 | 2,765 |
Net cash provided by operating activities | 53,797 | 33,209 |
Investing activities: | ||
Purchases of property and equipment | (1,070) | (736) |
Net cash used in investing activities | (1,070) | (736) |
Financing activities: | ||
Proceeds from the exercise of stock options, net | 126 | 4,317 |
Net cash provided by financing activities | 126 | 4,317 |
Effect of exchange rate changes on cash and cash equivalents | (701) | 104 |
Net increase in cash and cash equivalents | 52,152 | 36,894 |
Cash and cash equivalents, beginning of period | 218,455 | 146,013 |
Cash and cash equivalents, end of period | 270,607 | 182,907 |
Supplemental disclosure of cash flow information: | ||
Income taxes, net of refund | 713 | 364 |
Operating leases | 1,369 | 1,397 |
Supplemental disclosure of non-cash activities: | ||
Lease assets obtained in exchange for new operating lease liabilities | $ 11,105 | $ 1,440 |
Description of Business
Description of Business | 3 Months Ended |
Mar. 31, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Description of Business | Note 1. Description of Business Revolve Group, Inc., or REVOLVE, is an online fashion retailer for Millennial and Generation Z consumers. Through our websites and mobile applications we deliver an aspirational customer experience from a vast, yet curated merchandise offering. Our dynamic platform connects a deeply engaged community of consumers, global fashion influencers, and emerging, established and owned brands. We are headquartered in Los Angeles County, California. |
Significant Accounting Policies
Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2022 | |
Accounting Policies [Abstract] | |
Significant Accounting Policies | Note 2. Significant Accounting Policies Basis of Presentation Our unaudited condensed consolidated interim financial information has been prepared in accordance with Article 10 of the Securities and Exchange Commission’s, or the SEC, Regulation S-X. As permitted under those rules, certain footnotes or other financial information that are normally required by generally accepted accounting principles, or GAAP, in the United States can be condensed or omitted. These financial statements have been prepared on the same basis as our annual audited financial statements and, in the opinion of management, reflect all adjustments, consisting only of normal recurring adjustments, which are necessary for the fair statement of our financial information. These interim results are not necessarily indicative of the results to be expected for the fiscal year ending December 31, 2022 or for any other interim period or for any other future year. All intercompany transactions and balances have been eliminated in consolidation. Our fiscal year ends on December 31 of each year. The accompanying unaudited condensed consolidated financial statements and related notes thereto should be read in conjunction with the audited consolidated financial statements and the related notes thereto for the fiscal year ended December 31, 2021 contained in our Annual Report on Form 10-K filed with the SEC on February 28, 2022. Impact of COVID-19 on Our Business There continues to be uncertainty around the COVID-19 pandemic and its impact on our business operations and operating results. While demand for our products improved, the extent of this increased demand in the future remains uncertain. A resurgence of the pandemic may result in business restrictions and social distancing mandates, the cancellation of large, in-person brand marketing events, supply chain disruptions, changes in consumer behavior and an increase in the cost of goods sold. We believe that our existing cash and cash equivalents and cash flows from operations will be sufficient to meet our anticipated cash needs for at least the next 12 months. However, our liquidity assumptions may prove to be incorrect given the continued uncertainty of the COVID-19 pandemic, and we could exhaust our available financial resources sooner than we currently expect. Use of Estimates The preparation of condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Significant items subject to such estimates and assumptions include: the allowance for sales returns, the valuation of deferred tax assets, inventory, equity‑based compensation, goodwill, and breakage of store credit and gift cards. Net Sales Revenue is primarily derived from the sale of apparel merchandise through our sites and, when applicable, shipping revenue. In accordance with ASC 606, we recognize revenue through the following steps: (1) identification of the contract, or contracts, with the customer; (2) identification of the performance obligations in the contract; (3) determination of the transaction price; (4) allocation of the transaction price to the performance obligations in the contract; and (5) recognition of revenue when, or as, we satisfy a performance obligation. A contract is created with our customer at the time the order is placed by the customer, which creates a performance obligation to deliver the product to the customer. We recognize revenue for the performance obligation at the time control of the merchandise passes to the customer, which is at the time of shipment. In addition, we have elected to treat shipping and handling as fulfillment activities and not a separate performance obligation. In March 2020 we launched the REVOLVE Loyalty Club within the REVOLVE segment and in April 2021 we expanded the program to include the FWRD segment. Eligible customers who enroll in the program will generally earn points for every dollar spent and will automatically receive a $ 20 reward once they earn 2,000 points. We defer revenue based on an allocation of the price of the customer purchase and the estimated standalone selling price of the points earned. Revenue is recognized once the reward is redeemed or expires or once unconverted points expire. Rewards generally expire 90 days after they are issued and unconverted points generally expire if a customer fails to engage in any activity that generates points for a period of one year or if their participation in the program is otherwise terminated. In accordance with our policy on returns and exchanges, merchandise returns are generally accepted for full refund if returned within 30 days of the original purchase date and may be exchanged up to 60 days from the original purchase date. We modified our policy during the holiday season to extend the return and exchange period. In addition, to provide our customers with m ore flexibility to return or exchange during this time of increased social distancing as a result of the COVID-19 pandemic, merchandise returns for purchases made starting in March 2020 may be accepted for full refund if returned within 60 days of the original purchase date and may be exchanged up to 90 days from the original purchase date. At the time of sale, we establish a reserve for merchandise returns, based on historical experience, merchandise mix and expected future returns, which is recorded as a reduction of sales. Accordingly, cost of sales is also reduced and an offsetting asset is recorded within prepaid expenses and other current assets for expected merchandise to be returned. The following table presents a rollforward of our sales return reserve for the three months ended March 31, 2022 (in thousands): Three Months Ended March 31, 2022 2021 Beginning balance $ 49,296 $ 25,602 Returns ( 318,392 ) ( 135,341 ) Provisions 338,722 147,210 Ending balance $ 69,626 $ 37,471 We may also issue store credit in lieu of cash refunds and sell gift cards without expiration dates to our customers. Store credits issued and proceeds from the issuance of gift cards are recorded as deferred revenue and recognized as revenue when the store credit or gift cards are redeemed or upon inclusion in our store credit and gift card breakage estimates. Revenue recognized in net sales on breakage on store credit and gift cards was $ 0.5 million and $ 0.2 million for the three months ended March 31, 2022 and 2021, respectively. Sales taxes and duties collected from customers and remitted to governmental authorities are accounted for on a net basis and therefore are excluded from net sales. We currently collect sales taxes in all states that have adopted laws imposing sales tax collection obligations on out-of-state retailers and are subject to audits by state governments of sales tax collection obligations on out-of-state retailers in jurisdictions where we do not currently collect sales taxes, whether for prior years or prospectively. No significant interest or penalties related to sales taxes are recognized in the accompanying condensed consolidated financial statements. We have exposure to losses from fraudulent credit card charges. We record losses when incurred related to these fraudulent charges as amounts have historically been insignificant. See Note 9, Segment Information , for disaggregation of revenue by reportable segment, by geographic area and by major product category. Accounting Pronouncements Not Yet Effective There have been no new accounting pronouncements not yet effective that have significance, or potential significance, to our consolidated financial statements. |
Line of Credit
Line of Credit | 3 Months Ended |
Mar. 31, 2022 | |
Debt Disclosure [Abstract] | |
Line of Credit | Note 3. Line of Credit On March 23, 2021 , we amended and restated our existing credit agreement to, among other things, extend the expiration date from March 23, 2021 to March 23, 2026 . The line of credit provides us with up to $ 75.0 million aggregate principal in revolver borrowings, based on eligible inventory and accounts receivable less reserves. Borrowings under the credit agreement accrue interest, at our option, at (1) a base rate equal to the highest of (a) the federal funds rate, plus 0.50 %, (b) the prime rate and (c) an adjusted LIBO rate determined on the basis of a one-month interest period , plus 1.00 %, or (2) an adjusted LIBO rate, subject to a floor of 0.00 %, in each case, plus a margin ranging from 0.25 % to 0.75 % per year in the case of base rate loans, and 1.25 % to 1.75 % per year in the case of LIBO rate loans. No borrowings were outstanding as of March 31, 2022 and December 31, 2021. We are also obligated to pay other customary fees for a credit facility of this size and type, including an unused commitment fee. The credit agreement also permits us, in certain circumstances, to request an increase in the facility by an additional amount of up to $ 25.0 million (in an initial minimum amount of $ 10 million and in increments of $ 5 million thereafter) at the same maturity, pricing and other terms. Our obligations under the credit agreement are secured by substantially all of our assets. The credit agreement also contains customary covenants restricting our activities, including limitations on our ability to sell assets, engage in mergers and acquisitions, enter into transactions involving related parties, obtain letters of credit, incur indebtedness or grant liens or negative pledges on our assets, make loans or make other investments. Under the covenants, we are prohibited from paying cash dividends with respect to our capital stock . We were in compliance with all financial covenants as of March 31, 2022 and December 31, 2021. |
Equity-based Compensation
Equity-based Compensation | 3 Months Ended |
Mar. 31, 2022 | |
Share-based Payment Arrangement [Abstract] | |
Equity-based Compensation | Note 4. Equity-based Compensation In 2013, Twist Holdings, LLC, or Twist, and Advance Holdings, LLC, or Advance, which became the Revolve Group, Inc., adopted equity incentive plans, which we refer to collectively as the 2013 Plan, pursuant to which the board of managers could grant options to purchase Class A units to officers and employees. Options could be granted with an exercise price equal to or greater than the unit’s fair value at the date of grant. All issued awards have 10-year terms and generally vest and become fully exercisable annually over five years of service from the date of grant. Awards will become fully vested upon the sale of the Company. In March 2018, the 2013 Plan was amended to increase the maximum number of Class A units to 6,207,978 . In September 2018, the board of directors adopted the 2019 Equity Incentive Plan, or the 2019 Plan, which became effective in June 2019. Under the 2019 Plan, a total of 4,500,000 shares of our Class A common stock were reserved for issuance as options, stock appreciation rights, restricted stock, restricted stock units, or RSUs, performance units or performance shares. Upon the completion of our initial public offering, or IPO, the 2019 Plan replaced the 2013 Plan; however, the 2013 Plan will continue to govern the terms and conditions of the outstanding awards previously granted under that plan. The number of shares that will be available for issuance under our 2019 Plan also will increase annually on the first day of each year beginning in 2020, in an amount equal to the least of: (a) 6,900,000 shares, (b) 5 % of the outstanding shares of all classes of our common stock as of the last day of the immediately preceding year and (c) such other amount as our board of directors may determine . All future grants going forward will be issued under the 2019 Plan. On January 1, 2021, the number of shares available under the 2019 Plan was increased by 2.0 million shares and o n January 1, 2022, the number of shares available under the 2019 Plan was further increased by 3.7 million shares. As of March 31, 2022 , approximately 8.3 million shares of Class A common stock remain available for future issuance under the 2019 Plan. Option activity for the three months ended March 31, 2022 under the 2013 and 2019 Plans is as follows: Number of Weighted Weighted Aggregate Balance at January 1, 2022 2,342,271 $ 13.48 7.5 $ 100,232 Granted 308,937 46.83 9.8 Exercised ( 51,399 ) 9.59 — Forfeited ( 31,687 ) 32.83 — Expired ( 400 ) 10.32 — Balance at March 31, 2022 2,567,722 17.33 7.6 93,895 Exercisable at March 31, 2022 692,155 11.23 6.2 29,391 Vested and expected to vest 2,567,722 17.33 7.6 93,895 RSU award activity for the three months ended March 31, 2022 under the 2019 Plan is as follows: Class A Weighted Weighted Aggregate Unvested at January 1, 2022 32,336 $ 43.94 0.6 $ 1,812 Granted (1) 61,032 45.63 0.9 Released ( 23,003 ) 46.86 Forfeited (2) ( 33,978 ) 45.65 Unvested at March 31, 2022 36,387 43.33 1.0 1,954 (1) Includes an adjustment of 1,165 shares underlying performance-based RSU awards made during the three months ended March 31, 2022. The vesting of such RSUs is based upon the Company’s current performance against predefined financial targets. (2) Includes an adjustment of ( 33,978 ) shares underlying performance-based RSU awards made during the three months ended March 31, 2022. The vesting of such RSUs is based upon the Company’s current performance against predefined financial targets. There were 308,937 options and 59,867 RSUs granted during the three months ended March 31, 2022. The weighted average grant-date fair value of options granted during the three months ended March 31, 2022 was $ 23.75 per share. The weighted average grant-date fair value of RSUs granted during the three months ended March 31, 2022 was $ 45.63 per share. As of March 31, 2022 , there was $ 17.4 million of total unrecognized compensation cost related to unvested options and RSUs granted under the 2013 Plan and 2019 Plan, which is expected to be recognized over a weighted average service period of 3.7 years. Equity‑based compensation cost that has been included in general and administrative expense in the accompanying condensed consolidated statements of income amounted to $ 1.5 million and $ 1.0 million for the three months ended March 31, 2022 and 2021, respectively. There was an excess income tax benefit of $ 0.5 million and $ 6.7 million recognized in the condensed consolidated statements of income for equity‑based compensation arrangements for the three months ended March 31, 2022 and 2021, respectively. |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Note 5. Commitments and Contingencies Contingencies We record a loss contingency when it is probable that a liability has been incurred and the amount of the loss can be reasonably estimated. We also disclose material contingencies when we believe a loss is not probable but reasonably possible. Accounting for contingencies requires us to use judgment related to both the likelihood of a loss and the estimate of the amount or range of loss. Although we cannot predict with assurance the outcome of any litigation or tax matters, we do not believe there are currently any such actions that, if resolved unfavorably, would have a material impact on our operating results, financial position and cash flows. Indemnifications In the ordinary course of business, we may provide indemnifications of varying scope and terms to vendors, directors, officers and other parties with respect to certain matters. We have not incurred any material costs as a result of such indemnifications and have not accrued any liabilities related to such obligations in our condensed consolidated financial statements. Tax Contingencies We are subject to income taxes in the United States and the U.K. Significant judgment is required in evaluating our tax positions and determining our provision for income taxes. During the ordinary course of business, there are transactions and calculations for which the ultimate tax determination is uncertain. We establish reserves for tax-related uncertainties based on estimates of whether, and the extent to which, additional taxes will be due. These reserves are established when we believe that certain positions might be challenged despite our belief that our tax return positions are fully supportable. We adjust these reserves in light of changing facts and circumstances, such as the outcome of tax audits. Our provision for income taxes does not include any reserve provision because we believe that all of our tax positions are highly certain. Legal Proceedings We were a defendant in a purported class action lawsuit filed in the Superior Court of California, Los Angeles County, which was filed in May 2019, arising from employee wage-and-hour claims under California law for alleged meal period, rest period, payment of wages at separation, wage statement violations, and unfair business practices. On January 6, 2020, we and the individual plaintiff in the case entered into a binding memorandum of understanding to settle the case. In December 2019, we accrued approximately $ 1.0 million to general and administrative expenses. On January 5, 2021, the court granted approval of the settlement, which was subsequently paid by the Company during the first quarter of 2021. On March 15, 2022, we received a cease and desist letter alleging copyright infringement and related claims. This matter has not proceeded to litigation as of the date of this report and we have recorded an accrual for an amount equal to a self-insured retention under our insurance policy. |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2022 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Note 6. Income Taxes The following table summarizes our effective tax rate for the periods presented (in thousands): Three Months Ended March 31, 2022 2021 Income before income taxes $ 28,966 $ 20,982 Provision for (benefit from) income taxes 6,398 ( 1,270 ) Effective tax rate 22.1 % ( 6.1 %) The increase in the effective tax rate for the three months ended March 31, 2022, as compared to the same period in 2021 , was primarily due to a decrease in excess tax benefits related to the exercise of non-qualified stock options. |
Stockholders' Equity
Stockholders' Equity | 3 Months Ended |
Mar. 31, 2022 | |
Equity [Abstract] | |
Stockholders' Equity | Note 7. Stockholders’ Equity Changes in stockholders’ equity for the three months ended March 31, 2022 and 2021 were as follows: Three Months Ended March 31, 2022 Common Stock Additional Retained Total Number Amount Capital Earnings Equity (in thousands, except share data) Beginning balance 73,233,321 $ 73 $ 103,590 $ 213,351 $ 317,014 Issuance of Class A common stock from exercise of 65,528 1 125 — 126 Equity-based — — 1,491 — 1,491 Cumulative translation — — — ( 701 ) ( 701 ) Net income — — — 22,568 22,568 Ending balance 73,298,849 $ 74 $ 105,206 $ 235,218 $ 340,498 Three Months Ended March 31, 2021 Common Stock Additional Retained Total Number Amount Capital Earnings Equity (in thousands, except share data) Beginning balance 71,396,706 $ 71 $ 86,040 $ 113,953 $ 200,064 Issuance of Class A common stock from exercise of 766,809 1 4,316 — 4,317 Equity-based — — 976 — 976 Cumulative translation — — — 104 104 Net income — — — 22,252 22,252 Ending balance 72,163,515 $ 72 $ 91,332 $ 136,309 $ 227,713 |
Earnings per Share
Earnings per Share | 3 Months Ended |
Mar. 31, 2022 | |
Earnings Per Share [Abstract] | |
Earnings per Share | Note 8. Earnings per Share Basic and diluted earnings per share is presented in conformity with the two-class method required for multiple classes of common stock. In connection with our IPO, we established two classes of authorized common stock: Class A common stock and Class B common stock. The rights of the holders of Class A and Class B common stock are identical, except for voting and conversion rights. Each share of Class A common stock is entitled to one vote per share. Each share of Class B common stock is entitled to ten votes per share and is convertible at any time into one share of Class A common stock. Basic earnings per share is computed by dividing the net income attributable to common stockholders by the weighted-average number of shares of common stock outstanding during the period. Diluted earnings per share represents net income divided by the weighted-average number of shares of common stock outstanding, inclusive of the effect of dilutive stock options and RSUs. The undistributed earnings are allocated based on the participation rights of shares of Class A and Class B common stock as if the earnings for the year have been distributed. As the liquidation and dividend rights are identical for both classes, the undistributed earnings are allocated on a proportionate basis. The calculation of diluted earnings per share for Class A common stock assumes the conversion of Class B common stock, while diluted earnings per share of Class B common stock does not assume the conversion of Class A common stock as Class A common stock is not convertible into Class B common stock. Similarly, outstanding options to purchase Class B common stock and RSUs that are dilutive are included in the calculation of diluted earnings for both Class A and Class B common stock. The following table presents the calculation of basic and diluted earnings per share: Three Months Ended March 31, 2022 2021 Class A Class B Class A Class B (in thousands, except per share data) Numerator Net income $ 12,424 $ 10,144 $ 10,779 $ 11,473 Reallocation of undistributed earnings as a result of conversion of Class B to Class A common stock 10,144 — 11,473 — Reallocation of undistributed earnings to Class B common stock — 256 — 328 Net income attributable to common $ 22,568 $ 10,400 $ 22,252 $ 11,801 Denominator Weighted average shares used 40,333 32,931 34,771 37,011 Conversion of Class B to Class A 32,931 — 37,011 — Effect of dilutive stock options 1,539 1,539 2,251 2,251 Weighted average number of shares 74,803 34,470 74,033 39,262 Earnings per share: Basic $ 0.31 $ 0.31 $ 0.31 $ 0.31 Diluted $ 0.30 $ 0.30 $ 0.30 $ 0.30 The following have been excluded from the computation of basic and diluted earnings per share as their effect would have been anti-dilutive (in thousands): Three Months Ended March 31, 2022 2021 Stock options to purchase Class B 482 119 |
Segment Information
Segment Information | 3 Months Ended |
Mar. 31, 2022 | |
Segment Reporting [Abstract] | |
Segment Information | Note 9. Segment Information We have two reportable segments, REVOLVE and FWRD, each offering apparel, shoes, accessories, and beauty products available for sale to customers through their respective websites and mobile applications. Our reportable segments have been identified based on how our chief operating decision makers manage our business, make operating decisions and evaluate operating performance. Our chief operating decision makers are our co-chief executive officers. We evaluate the performance of our reportable segments based on net sales and gross profit. Management does not evaluate the performance of our reportable segments using asset measures. During the three months ended March 31, 2022 and 2021, no customer represented over 10 % of net sales. The following tables summarize our net sales and gross profit for each of our reportable segments (in thousands): Three Months Ended March 31, Net sales 2022 2021 REVOLVE $ 237,740 $ 152,160 FWRD 45,758 26,747 Total $ 283,498 $ 178,907 Gross profit REVOLVE $ 133,693 $ 84,213 FWRD 20,718 12,452 Total $ 154,411 $ 96,665 The following table presents net sales by geographic area (in thousands): Three Months Ended March 31, 2022 2021 United States $ 237,875 $ 143,285 Rest of the world (1) 45,623 35,622 Total $ 283,498 $ 178,907 (1) No individual country exceeded 10% of total net sales for any period presented. The following tables summarize net sales (in thousands) and percentage of net sales by product category for the three months ended March 31, 2022 and 2021: Three Months Ended March 31, 2022 2021 Net Sales Fashion Apparel $ 139,779 $ 103,501 Dresses 84,079 33,948 Handbags, Shoes and Accessories 49,628 32,300 Beauty 8,435 7,949 Other (1) 1,577 1,209 Total net sales $ 283,498 $ 178,907 As a percentage of net sales Fashion Apparel 49 % 58 % Dresses 30 % 19 % Handbags, Shoes and Accessories 17 % 18 % Beauty 3 % 4 % Other (1) 1 % 1 % Total net sales 100 % 100 % (1) Includes deferred revenue, shipping revenue and other revenue. |
Detail of Certain Balance Sheet
Detail of Certain Balance Sheet Accounts | 3 Months Ended |
Mar. 31, 2022 | |
Balance Sheet Related Disclosures [Abstract] | |
Detail of Certain Balance Sheet Accounts | Note 10. Detail of Certain Balance Sheet Accounts Prepaid Expenses and Other Current Assets Prepaid expenses and other current assets consist of the following (in thousands): March 31, December 31, 2022 2021 Expected merchandise returns, net $ 26,393 $ 18,521 Advanced payments on inventory to be delivered from vendors 13,712 13,059 Prepaid marketing 8,505 2,746 Prepaid insurance 1,001 1,859 Other 8,516 5,929 Total prepaid expenses and other current assets $ 58,127 $ 42,114 Accrued Expenses Accrued expenses consist of the following (in thousands): March 31, December 31, 2022 2021 Marketing $ 16,297 $ 11,023 Sales taxes 5,801 5,594 Salaries and related benefits 5,438 8,216 Selling and distribution 5,271 3,893 Other 7,815 5,173 Total accrued expenses $ 40,622 $ 33,899 Other Current Liabilities Other current liabilities consist of the following (in thousands): March 31, December 31, 2022 2021 Store credit $ 9,898 $ 9,630 Gift cards 3,129 2,977 REVOLVE Loyalty Club liability 3,606 2,974 Other 8,574 3,335 Total other current liabilities $ 25,207 $ 18,916 |
Significant Accounting Polici_2
Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2022 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation Our unaudited condensed consolidated interim financial information has been prepared in accordance with Article 10 of the Securities and Exchange Commission’s, or the SEC, Regulation S-X. As permitted under those rules, certain footnotes or other financial information that are normally required by generally accepted accounting principles, or GAAP, in the United States can be condensed or omitted. These financial statements have been prepared on the same basis as our annual audited financial statements and, in the opinion of management, reflect all adjustments, consisting only of normal recurring adjustments, which are necessary for the fair statement of our financial information. These interim results are not necessarily indicative of the results to be expected for the fiscal year ending December 31, 2022 or for any other interim period or for any other future year. All intercompany transactions and balances have been eliminated in consolidation. Our fiscal year ends on December 31 of each year. The accompanying unaudited condensed consolidated financial statements and related notes thereto should be read in conjunction with the audited consolidated financial statements and the related notes thereto for the fiscal year ended December 31, 2021 contained in our Annual Report on Form 10-K filed with the SEC on February 28, 2022. |
Impact of COVID-19 on Our Business | Impact of COVID-19 on Our Business There continues to be uncertainty around the COVID-19 pandemic and its impact on our business operations and operating results. While demand for our products improved, the extent of this increased demand in the future remains uncertain. A resurgence of the pandemic may result in business restrictions and social distancing mandates, the cancellation of large, in-person brand marketing events, supply chain disruptions, changes in consumer behavior and an increase in the cost of goods sold. We believe that our existing cash and cash equivalents and cash flows from operations will be sufficient to meet our anticipated cash needs for at least the next 12 months. However, our liquidity assumptions may prove to be incorrect given the continued uncertainty of the COVID-19 pandemic, and we could exhaust our available financial resources sooner than we currently expect. |
Use of Estimates | Use of Estimates The preparation of condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Significant items subject to such estimates and assumptions include: the allowance for sales returns, the valuation of deferred tax assets, inventory, equity‑based compensation, goodwill, and breakage of store credit and gift cards. |
Net Sales | Net Sales Revenue is primarily derived from the sale of apparel merchandise through our sites and, when applicable, shipping revenue. In accordance with ASC 606, we recognize revenue through the following steps: (1) identification of the contract, or contracts, with the customer; (2) identification of the performance obligations in the contract; (3) determination of the transaction price; (4) allocation of the transaction price to the performance obligations in the contract; and (5) recognition of revenue when, or as, we satisfy a performance obligation. A contract is created with our customer at the time the order is placed by the customer, which creates a performance obligation to deliver the product to the customer. We recognize revenue for the performance obligation at the time control of the merchandise passes to the customer, which is at the time of shipment. In addition, we have elected to treat shipping and handling as fulfillment activities and not a separate performance obligation. In March 2020 we launched the REVOLVE Loyalty Club within the REVOLVE segment and in April 2021 we expanded the program to include the FWRD segment. Eligible customers who enroll in the program will generally earn points for every dollar spent and will automatically receive a $ 20 reward once they earn 2,000 points. We defer revenue based on an allocation of the price of the customer purchase and the estimated standalone selling price of the points earned. Revenue is recognized once the reward is redeemed or expires or once unconverted points expire. Rewards generally expire 90 days after they are issued and unconverted points generally expire if a customer fails to engage in any activity that generates points for a period of one year or if their participation in the program is otherwise terminated. In accordance with our policy on returns and exchanges, merchandise returns are generally accepted for full refund if returned within 30 days of the original purchase date and may be exchanged up to 60 days from the original purchase date. We modified our policy during the holiday season to extend the return and exchange period. In addition, to provide our customers with m ore flexibility to return or exchange during this time of increased social distancing as a result of the COVID-19 pandemic, merchandise returns for purchases made starting in March 2020 may be accepted for full refund if returned within 60 days of the original purchase date and may be exchanged up to 90 days from the original purchase date. At the time of sale, we establish a reserve for merchandise returns, based on historical experience, merchandise mix and expected future returns, which is recorded as a reduction of sales. Accordingly, cost of sales is also reduced and an offsetting asset is recorded within prepaid expenses and other current assets for expected merchandise to be returned. The following table presents a rollforward of our sales return reserve for the three months ended March 31, 2022 (in thousands): Three Months Ended March 31, 2022 2021 Beginning balance $ 49,296 $ 25,602 Returns ( 318,392 ) ( 135,341 ) Provisions 338,722 147,210 Ending balance $ 69,626 $ 37,471 We may also issue store credit in lieu of cash refunds and sell gift cards without expiration dates to our customers. Store credits issued and proceeds from the issuance of gift cards are recorded as deferred revenue and recognized as revenue when the store credit or gift cards are redeemed or upon inclusion in our store credit and gift card breakage estimates. Revenue recognized in net sales on breakage on store credit and gift cards was $ 0.5 million and $ 0.2 million for the three months ended March 31, 2022 and 2021, respectively. Sales taxes and duties collected from customers and remitted to governmental authorities are accounted for on a net basis and therefore are excluded from net sales. We currently collect sales taxes in all states that have adopted laws imposing sales tax collection obligations on out-of-state retailers and are subject to audits by state governments of sales tax collection obligations on out-of-state retailers in jurisdictions where we do not currently collect sales taxes, whether for prior years or prospectively. No significant interest or penalties related to sales taxes are recognized in the accompanying condensed consolidated financial statements. We have exposure to losses from fraudulent credit card charges. We record losses when incurred related to these fraudulent charges as amounts have historically been insignificant. See Note 9, Segment Information , for disaggregation of revenue by reportable segment, by geographic area and by major product category. |
Accounting Pronouncements Not Yet Effective | Accounting Pronouncements Not Yet Effective There have been no new accounting pronouncements not yet effective that have significance, or potential significance, to our consolidated financial statements. |
Significant Accounting Polici_3
Significant Accounting Policies (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Accounting Policies [Abstract] | |
Summary of Sales Return Reserve | The following table presents a rollforward of our sales return reserve for the three months ended March 31, 2022 (in thousands): Three Months Ended March 31, 2022 2021 Beginning balance $ 49,296 $ 25,602 Returns ( 318,392 ) ( 135,341 ) Provisions 338,722 147,210 Ending balance $ 69,626 $ 37,471 |
Equity-based Compensation (Tabl
Equity-based Compensation (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Share-based Payment Arrangement [Abstract] | |
Summary of Equity Option Activity | Option activity for the three months ended March 31, 2022 under the 2013 and 2019 Plans is as follows: Number of Weighted Weighted Aggregate Balance at January 1, 2022 2,342,271 $ 13.48 7.5 $ 100,232 Granted 308,937 46.83 9.8 Exercised ( 51,399 ) 9.59 — Forfeited ( 31,687 ) 32.83 — Expired ( 400 ) 10.32 — Balance at March 31, 2022 2,567,722 17.33 7.6 93,895 Exercisable at March 31, 2022 692,155 11.23 6.2 29,391 Vested and expected to vest 2,567,722 17.33 7.6 93,895 |
Summary of RSU Award Activity | RSU award activity for the three months ended March 31, 2022 under the 2019 Plan is as follows: Class A Weighted Weighted Aggregate Unvested at January 1, 2022 32,336 $ 43.94 0.6 $ 1,812 Granted (1) 61,032 45.63 0.9 Released ( 23,003 ) 46.86 Forfeited (2) ( 33,978 ) 45.65 Unvested at March 31, 2022 36,387 43.33 1.0 1,954 (1) Includes an adjustment of 1,165 shares underlying performance-based RSU awards made during the three months ended March 31, 2022. The vesting of such RSUs is based upon the Company’s current performance against predefined financial targets. (2) Includes an adjustment of ( 33,978 ) shares underlying performance-based RSU awards made during the three months ended March 31, 2022. The vesting of such RSUs is based upon the Company’s current performance against predefined financial targets. |
Income Taxes (Tables)
Income Taxes (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Income Tax Disclosure [Abstract] | |
Summary of Effective Tax Rate | The following table summarizes our effective tax rate for the periods presented (in thousands): Three Months Ended March 31, 2022 2021 Income before income taxes $ 28,966 $ 20,982 Provision for (benefit from) income taxes 6,398 ( 1,270 ) Effective tax rate 22.1 % ( 6.1 %) |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Equity [Abstract] | |
Schedule of Changes in Stockholders' Equity | Changes in stockholders’ equity for the three months ended March 31, 2022 and 2021 were as follows: Three Months Ended March 31, 2022 Common Stock Additional Retained Total Number Amount Capital Earnings Equity (in thousands, except share data) Beginning balance 73,233,321 $ 73 $ 103,590 $ 213,351 $ 317,014 Issuance of Class A common stock from exercise of 65,528 1 125 — 126 Equity-based — — 1,491 — 1,491 Cumulative translation — — — ( 701 ) ( 701 ) Net income — — — 22,568 22,568 Ending balance 73,298,849 $ 74 $ 105,206 $ 235,218 $ 340,498 Three Months Ended March 31, 2021 Common Stock Additional Retained Total Number Amount Capital Earnings Equity (in thousands, except share data) Beginning balance 71,396,706 $ 71 $ 86,040 $ 113,953 $ 200,064 Issuance of Class A common stock from exercise of 766,809 1 4,316 — 4,317 Equity-based — — 976 — 976 Cumulative translation — — — 104 104 Net income — — — 22,252 22,252 Ending balance 72,163,515 $ 72 $ 91,332 $ 136,309 $ 227,713 |
Earnings per Share (Tables)
Earnings per Share (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Earnings Per Share [Abstract] | |
Schedule of Calculation of Basic and Diluted Earnings per Share | The following table presents the calculation of basic and diluted earnings per share: Three Months Ended March 31, 2022 2021 Class A Class B Class A Class B (in thousands, except per share data) Numerator Net income $ 12,424 $ 10,144 $ 10,779 $ 11,473 Reallocation of undistributed earnings as a result of conversion of Class B to Class A common stock 10,144 — 11,473 — Reallocation of undistributed earnings to Class B common stock — 256 — 328 Net income attributable to common $ 22,568 $ 10,400 $ 22,252 $ 11,801 Denominator Weighted average shares used 40,333 32,931 34,771 37,011 Conversion of Class B to Class A 32,931 — 37,011 — Effect of dilutive stock options 1,539 1,539 2,251 2,251 Weighted average number of shares 74,803 34,470 74,033 39,262 Earnings per share: Basic $ 0.31 $ 0.31 $ 0.31 $ 0.31 Diluted $ 0.30 $ 0.30 $ 0.30 $ 0.30 |
Schedule of Antidilutive Securities Excluded from Computation of Basic and Diluted Earnings per Share | The following have been excluded from the computation of basic and diluted earnings per share as their effect would have been anti-dilutive (in thousands): Three Months Ended March 31, 2022 2021 Stock options to purchase Class B 482 119 |
Segment Information (Tables)
Segment Information (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Segment Reporting [Abstract] | |
Summary of Net Sales and Gross Profit of Reportable Segments | The following tables summarize our net sales and gross profit for each of our reportable segments (in thousands): Three Months Ended March 31, Net sales 2022 2021 REVOLVE $ 237,740 $ 152,160 FWRD 45,758 26,747 Total $ 283,498 $ 178,907 Gross profit REVOLVE $ 133,693 $ 84,213 FWRD 20,718 12,452 Total $ 154,411 $ 96,665 |
Schedule of Net Sales by Geographic Area | The following table presents net sales by geographic area (in thousands): Three Months Ended March 31, 2022 2021 United States $ 237,875 $ 143,285 Rest of the world (1) 45,623 35,622 Total $ 283,498 $ 178,907 (1) No individual country exceeded 10% of total net sales for any period presented. |
Summary of Net Sales and Percentage of Net Sales by Product Category | The following tables summarize net sales (in thousands) and percentage of net sales by product category for the three months ended March 31, 2022 and 2021: Three Months Ended March 31, 2022 2021 Net Sales Fashion Apparel $ 139,779 $ 103,501 Dresses 84,079 33,948 Handbags, Shoes and Accessories 49,628 32,300 Beauty 8,435 7,949 Other (1) 1,577 1,209 Total net sales $ 283,498 $ 178,907 As a percentage of net sales Fashion Apparel 49 % 58 % Dresses 30 % 19 % Handbags, Shoes and Accessories 17 % 18 % Beauty 3 % 4 % Other (1) 1 % 1 % Total net sales 100 % 100 % (1) Includes deferred revenue, shipping revenue and other revenue. |
Detail of Certain Balance She_2
Detail of Certain Balance Sheet Accounts (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Balance Sheet Related Disclosures [Abstract] | |
Schedule of Prepaid Expenses and Other Current Assets | Prepaid expenses and other current assets consist of the following (in thousands): March 31, December 31, 2022 2021 Expected merchandise returns, net $ 26,393 $ 18,521 Advanced payments on inventory to be delivered from vendors 13,712 13,059 Prepaid marketing 8,505 2,746 Prepaid insurance 1,001 1,859 Other 8,516 5,929 Total prepaid expenses and other current assets $ 58,127 $ 42,114 |
Schedule of Accrued Expenses | Accrued expenses consist of the following (in thousands): March 31, December 31, 2022 2021 Marketing $ 16,297 $ 11,023 Sales taxes 5,801 5,594 Salaries and related benefits 5,438 8,216 Selling and distribution 5,271 3,893 Other 7,815 5,173 Total accrued expenses $ 40,622 $ 33,899 |
Schedule of Other Current Liabilities | Other current liabilities consist of the following (in thousands): March 31, December 31, 2022 2021 Store credit $ 9,898 $ 9,630 Gift cards 3,129 2,977 REVOLVE Loyalty Club liability 3,606 2,974 Other 8,574 3,335 Total other current liabilities $ 25,207 $ 18,916 |
Significant Accounting Polici_4
Significant Accounting Policies - Additional Information (Details) | 3 Months Ended | |
Mar. 31, 2022USD ($)Point | Mar. 31, 2021USD ($) | |
Summary Of Significant Accounting Policies [Line Items] | ||
Loyalty program description | In March 2020 we launched the REVOLVE Loyalty Club within the REVOLVE segment and in April 2021 we expanded the program to include the FWRD segment. Eligible customers who enroll in the program will generally earn points for every dollar spent and will automatically receive a $20 reward once they earn 2,000 points. | |
Reward amount | $ 20 | |
Number of reward point | Point | 2,000 | |
Revenue recognized | $ 283,498,000 | $ 178,907,000 |
Topic 606 | Breakage on Store Credit and Gift Cards | ||
Summary Of Significant Accounting Policies [Line Items] | ||
Revenue recognized | $ 500,000 | $ 200,000 |
Significant Accounting Polici_5
Significant Accounting Policies - Summary of Sales Return Reserve (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Accounting Policies [Abstract] | ||
Beginning balance | $ 49,296 | $ 25,602 |
Returns | (318,392) | (135,341) |
Provisions | 338,722 | 147,210 |
Ending balance | $ 69,626 | $ 37,471 |
Line of Credit - Additional Inf
Line of Credit - Additional Information (Details) - Revolving Credit Facility - Bank of America, N.A, - USD ($) | Mar. 23, 2021 | Mar. 31, 2022 | Dec. 31, 2021 |
Line Of Credit Facility [Line Items] | |||
Line of credit facility agreement date | Mar. 23, 2021 | ||
Line of credit facility expiration date | Mar. 23, 2026 | ||
Maximum amount of line of credit | $ 75,000,000 | ||
Line of credit facility interest rate description | Borrowings under the credit agreement accrue interest, at our option, at (1) a base rate equal to the highest of (a) the federal funds rate, plus 0.50%, (b) the prime rate and (c) an adjusted LIBO rate determined on the basis of a one-month interest period, plus 1.00%, or (2) an adjusted LIBO rate, subject to a floor of 0.00%, in each case, plus a margin ranging from 0.25% to 0.75% per year in the case of base rate loans, and 1.25% to 1.75% per year in the case of LIBO rate loans. | ||
Outstanding borrowings | $ 0 | $ 0 | |
Line of credit facility, additional maximum borrowing capacity | 25,000,000 | ||
Line of credit facility, additional borrowing capacity initial minimum amount | 10,000,000 | ||
Line of credit facility, additional borrowing capacity increments thereafter | $ 5,000,000 | ||
Line of credit facility, asset restrictions | The credit agreement also contains customary covenants restricting our activities, including limitations on our ability to sell assets, engage in mergers and acquisitions, enter into transactions involving related parties, obtain letters of credit, incur indebtedness or grant liens or negative pledges on our assets, make loans or make other investments. | ||
Line of credit facility, dividend restrictions | prohibited from paying cash dividends with respect to our capital stock | ||
Federal Funds Rate | |||
Line Of Credit Facility [Line Items] | |||
Basis spread on variable rate (as a percent) | 0.50% | ||
London Interbank Offered Rate (LIBOR) | |||
Line Of Credit Facility [Line Items] | |||
Basis spread on variable rate (as a percent) | 1.00% | ||
Interest rate terms | one-month interest period | ||
Floor rate (as a percent) | 0.00% | ||
Margin Rate | Minimum | |||
Line Of Credit Facility [Line Items] | |||
Basis spread on variable rate (as a percent) | 0.25% | ||
Margin Rate | Maximum | |||
Line Of Credit Facility [Line Items] | |||
Basis spread on variable rate (as a percent) | 0.75% | ||
LIBOR Rate Margin | Minimum | |||
Line Of Credit Facility [Line Items] | |||
Basis spread on variable rate (as a percent) | 1.25% | ||
LIBOR Rate Margin | Maximum | |||
Line Of Credit Facility [Line Items] | |||
Basis spread on variable rate (as a percent) | 1.75% |
Equity-based Compensation - Add
Equity-based Compensation - Additional Information (Details) - USD ($) $ / shares in Units, $ in Millions | Jan. 01, 2022 | Jan. 01, 2021 | Jun. 30, 2019 | Mar. 31, 2022 | Mar. 31, 2021 | Dec. 31, 2013 | Mar. 31, 2018 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||||
Stock option granted | 308,937 | |||||||
Weighted average grant date fair value of options granted | $ 23.75 | |||||||
Tax benefits in relation to equity-based compensation | $ 0.5 | $ 6.7 | ||||||
General and Administrative Expense | ||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||||
Equity-based compensation cost | $ 1.5 | $ 1 | ||||||
Class A Common Stock | Restricted Stock Units (RSUs) | ||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||||
Restricted stock unit granted | 59,867 | |||||||
Weighted average grant date fair value granted | $ 45.63 | |||||||
2013 Equity Incentive Plan | ||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||||
Equity incentive plans award term | 10-year | |||||||
Equity incentive plans vesting period | 5 years | |||||||
Amendment to 2013 Equity Incentive Plan | Class A Common Stock | Maximum | ||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||||
Number of shares available for issuance | 6,207,978 | |||||||
2019 Equity Incentive Plan | ||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||||
Common stock reserved for issuance | 8,300,000 | |||||||
Increase in number of shares reserved for future issuance, description | The number of shares that will be available for issuance under our 2019 Plan also will increase annually on the first day of each year beginning in 2020, in an amount equal to the least of: (a) 6,900,000 shares, (b) 5% of the outstanding shares of all classes of our common stock as of the last day of the immediately preceding year and (c) such other amount as our board of directors may determine | |||||||
Increase in number of shares reserved for future issuance, shares | 3,700,000 | 2,000,000 | 6,900,000 | |||||
Percentage of number of shares of common stock outstanding | 5.00% | |||||||
2019 Equity Incentive Plan | Restricted Stock Units (RSUs) | ||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||||
Total unrecognized compensation cost | $ 17.4 | |||||||
Total unrecognized compensation cost to be recognized, weighted average service period | 3 years 8 months 12 days | |||||||
2019 Equity Incentive Plan | Stock Option | ||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||||
Total unrecognized compensation cost | $ 17.4 | |||||||
Total unrecognized compensation cost to be recognized, weighted average service period | 3 years 8 months 12 days | |||||||
2019 Equity Incentive Plan | Class A Common Stock | ||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||||
Common stock reserved for issuance | 4,500,000 | |||||||
2019 Equity Incentive Plan | Class A Common Stock | Restricted Stock Units (RSUs) | ||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||||
Restricted stock unit granted | [1] | 61,032 | ||||||
Weighted average grant date fair value granted | [1] | $ 45.63 | ||||||
[1] | Includes an adjustment of 1,165 shares underlying performance-based RSU awards made during the three months ended March 31, 2022. The vesting of such RSUs is based upon the Company’s current performance against predefined financial targets. |
Equity-based Compensation - Sum
Equity-based Compensation - Summary of Equity Option Activity (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended |
Mar. 31, 2022 | Dec. 31, 2021 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Number of Shares, Granted | 308,937 | |
2013 and 2019 Equity Incentive Plan | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Number of Shares, Beginning balance | 2,342,271 | |
Number of Shares, Granted | 308,937 | |
Number of Shares, Exercised | (51,399) | |
Number of Shares, Forfeited | (31,687) | |
Number of Shares, Expired | (400) | |
Number of Shares, Ending balance | 2,567,722 | 2,342,271 |
Number of Shares, Exercisable | 692,155 | |
Number of Shares, Vested and expected to vest | 2,567,722 | |
Weighted Average Exercise Price, Beginning balance | $ 13.48 | |
Weighted Average Exercise Price, Granted | 46.83 | |
Weighted Average Exercise Price, Exercised | 9.59 | |
Weighted Average Exercise Price, Forfeited | 32.83 | |
Weighted Average Exercise Price, Expired | 10.32 | |
Weighted Average Exercise Price, Ending balance | 17.33 | $ 13.48 |
Weighted Average Exercise Price, Exercisable | 11.23 | |
Weighted Average Exercise Price, Vested and expected to vest | $ 17.33 | |
Weighted Average Remaining Contractual Term | 7 years 7 months 6 days | 7 years 6 months |
Weighted Average Remaining Contractual Term, Granted | 9 years 9 months 18 days | |
Weighted Average Remaining Contractual Term, Exercisable | 6 years 2 months 12 days | |
Weighted Average Remaining Contractual Term, Vested and expected to vest | 7 years 7 months 6 days | |
Aggregate Intrinsic Value, Balance | $ 93,895 | $ 100,232 |
Aggregate Intrinsic Value, Exercisable | 29,391 | |
Aggregate Intrinsic Value, Vested and expected to vest | $ 93,895 |
Equity-based Compensation - S_2
Equity-based Compensation - Summary of RSU Award Activity (Details) - Restricted Stock Units (RSUs) - Common Class A - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2022 | Dec. 31, 2021 | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Class A Common Stock, Granted | 59,867 | ||
Weighted Average Grant Date Fair Value,Granted | $ 45.63 | ||
2019 Equity Incentive Plan | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Class A Common Stock, Beginning balance | 32,336 | ||
Class A Common Stock, Granted | [1] | 61,032 | |
Class A Common Stock, Released | (23,003) | ||
Class A Common Stock, Forfeited | [2] | (33,978) | |
Class A Common Stock, Ending balance | 36,387 | 32,336 | |
Weighted Average Grant Date Fair Value, Beginning balance | $ 43.94 | ||
Weighted Average Grant Date Fair Value,Granted | [1] | 45.63 | |
Weighted Average Grant Date Fair Value,Released | 46.86 | ||
Weighted Average Grant Date Fair Value,Forfeited | [2] | 45.65 | |
Weighted Average Grant Date Fair Value,Ending Balance | $ 43.33 | $ 43.94 | |
Weighted Average Remaining Contractual Term | 7 months 6 days | ||
Weighted Average Remaining Contractual Term, Granted | [1] | 10 months 24 days | |
Weighted Average Remaining Contractual Term | 1 year | ||
Aggregate Intrinsic Value, Balance | $ 1,954 | $ 1,812 | |
[1] | Includes an adjustment of 1,165 shares underlying performance-based RSU awards made during the three months ended March 31, 2022. The vesting of such RSUs is based upon the Company’s current performance against predefined financial targets. | ||
[2] | Includes an adjustment of ( 33,978 ) shares underlying performance-based RSU awards made during the three months ended March 31, 2022. The vesting of such RSUs is based upon the Company’s current performance against predefined financial targets. |
Equity-based Compensation - S_3
Equity-based Compensation - Summary of RSU Award Activity (Parenthetical) (Details) - 2019 Equity Incentive Plan - Performance-Based RSU Awards | 3 Months Ended |
Mar. 31, 2022shares | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Restricted stock unit granted | 1,165 |
Restricted stock unit forfeited | (33,978) |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Details) $ in Millions | 1 Months Ended |
Dec. 31, 2019USD ($) | |
General and Administrative Expense | |
Commitments and Contingencies Disclosure [Line Items] | |
Accrued expenses on settlement of case | $ 1 |
Income Taxes - Summary of Effec
Income Taxes - Summary of Effective Tax Rate (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Income Tax Disclosure [Abstract] | ||
Income before income taxes | $ 28,966 | $ 20,982 |
Provision for (benefit from) income taxes | $ 6,398 | $ (1,270) |
Effective tax rate | 22.10% | (6.10%) |
Stockholders' Equity - Schedule
Stockholders' Equity - Schedule of Changes in Stockholders' Equity (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Class Of Stock [Line Items] | ||
Stockholders' equity, Beginning Balance | $ 317,014 | $ 200,064 |
Issuance of Class A common stock from exercise of stock options and vesting of restricted stock units | 126 | 4,317 |
Equity-based compensation | 1,491 | 976 |
Cumulative translation adjustment | (701) | 104 |
Net income | 22,568 | 22,252 |
Stockholders' equity, Ending Balance | 340,498 | 227,713 |
Common Stock | ||
Class Of Stock [Line Items] | ||
Stockholders' equity, Beginning Balance | $ 73 | $ 71 |
Stockholders' equity, Beginning Balance, Shares | 73,233,321 | 71,396,706 |
Issuance of Class A common stock from exercise of stock options and vesting of restricted stock units | $ 1 | $ 1 |
Issuance of Class A common stock from exercise of stock options and vesting of restricted stock units, shares | 65,528 | 766,809 |
Stockholders' equity, Ending Balance | $ 74 | $ 72 |
Stockholders' equity, Ending Balance, shares | 73,298,849 | 72,163,515 |
Additional Paid-in Capital | ||
Class Of Stock [Line Items] | ||
Stockholders' equity, Beginning Balance | $ 103,590 | $ 86,040 |
Issuance of Class A common stock from exercise of stock options and vesting of restricted stock units | 125 | 4,316 |
Equity-based compensation | 1,491 | 976 |
Stockholders' equity, Ending Balance | 105,206 | 91,332 |
Retained Earnings | ||
Class Of Stock [Line Items] | ||
Stockholders' equity, Beginning Balance | 213,351 | 113,953 |
Cumulative translation adjustment | (701) | 104 |
Net income | 22,568 | 22,252 |
Stockholders' equity, Ending Balance | $ 235,218 | $ 136,309 |
Earnings per Share - Additional
Earnings per Share - Additional Information (Details) | 3 Months Ended |
Mar. 31, 2022Voteshares | |
Common Class A | |
Earnings Per Share [Line Items] | |
Number of votes per share | 1 |
Conversion of stock | shares | 1 |
Common Class B | |
Earnings Per Share [Line Items] | |
Number of votes per share | 10 |
Earnings per Share - Schedule o
Earnings per Share - Schedule of Calculation of Basic and Diluted Earnings per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Numerator | ||
Net income | $ 22,568 | $ 22,252 |
Denominator | ||
Weighted average shares used to compute earnings per share — basic | 73,264 | 71,782 |
Weighted average number of shares used to compute earnings per share — diluted | 74,803 | 74,033 |
Earnings per share: | ||
Basic | $ 0.31 | $ 0.31 |
Diluted | $ 0.30 | $ 0.30 |
Common Class A | ||
Numerator | ||
Net income | $ 12,424 | $ 10,779 |
Reallocation of undistributed earnings | 10,144 | 11,473 |
Net income attributable to common stockholders — diluted | $ 22,568 | $ 22,252 |
Denominator | ||
Weighted average shares used to compute earnings per share — basic | 40,333 | 34,771 |
Conversion of Class B to Class A common stock outstanding | 32,931 | 37,011 |
Effect of dilutive stock options and RSUs | 1,539 | 2,251 |
Weighted average number of shares used to compute earnings per share — diluted | 74,803 | 74,033 |
Earnings per share: | ||
Basic | $ 0.31 | $ 0.31 |
Diluted | $ 0.30 | $ 0.30 |
Common Class B | ||
Numerator | ||
Net income | $ 10,144 | $ 11,473 |
Reallocation of undistributed earnings | 256 | 328 |
Net income attributable to common stockholders — diluted | $ 10,400 | $ 11,801 |
Denominator | ||
Weighted average shares used to compute earnings per share — basic | 32,931 | 37,011 |
Effect of dilutive stock options and RSUs | 1,539 | 2,251 |
Weighted average number of shares used to compute earnings per share — diluted | 34,470 | 39,262 |
Earnings per share: | ||
Basic | $ 0.31 | $ 0.31 |
Diluted | $ 0.30 | $ 0.30 |
Earnings per Share - Schedule_2
Earnings per Share - Schedule of Antidilutive Securities Excluded from Computation of Basic and Diluted Earnings per Share (Details) - shares shares in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Employee Stock Options And Restricted Stock Units R S U | Common Class B | ||
Earnings Per Share [Line Items] | ||
Stock options to purchase Class B shares and RSUs | 482 | 119 |
Segment Information - Additiona
Segment Information - Additional Information (Details) | 3 Months Ended | |
Mar. 31, 2022CustomerSegment | Mar. 31, 2021Customer | |
Segment Reporting Information [Line Items] | ||
Number of reportable segments | Segment | 2 | |
Segment reporting, disclosure of customers | During the three months ended March 31, 2022 and 2021, no customer represented over 10% of net sales. | |
Sales Revenue, Net | Customer Concentration Risk | ||
Segment Reporting Information [Line Items] | ||
Number of customer | Customer | 0 | 0 |
Percentage of net sales | 10.00% | 10.00% |
Segment Information - Summary o
Segment Information - Summary of Net Sales and Gross Profit of Reportable Segments (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Segment Reporting Information [Line Items] | ||
Net sales | $ 283,498 | $ 178,907 |
Gross profit | 154,411 | 96,665 |
REVOLVE | ||
Segment Reporting Information [Line Items] | ||
Net sales | 237,740 | 152,160 |
Gross profit | 133,693 | 84,213 |
FWRD | ||
Segment Reporting Information [Line Items] | ||
Net sales | 45,758 | 26,747 |
Gross profit | $ 20,718 | $ 12,452 |
Segment Information - Schedule
Segment Information - Schedule of Net Sales by Geographic Area (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Revenues From External Customers And Long Lived Assets [Line Items] | ||
Total net sales | $ 283,498 | $ 178,907 |
United States | ||
Revenues From External Customers And Long Lived Assets [Line Items] | ||
Total net sales | 237,875 | 143,285 |
Rest of the world | ||
Revenues From External Customers And Long Lived Assets [Line Items] | ||
Total net sales | $ 45,623 | $ 35,622 |
Segment Information - Summary_2
Segment Information - Summary of Net Sales and Percentage of Net Sales by Product Category (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Segment Reporting Information [Line Items] | ||
Total net sales | $ 283,498 | $ 178,907 |
Sales Revenue, Net | Product Concentration Risk | ||
Segment Reporting Information [Line Items] | ||
Percentage of net sales | 100.00% | 100.00% |
Fashion Apparel | ||
Segment Reporting Information [Line Items] | ||
Total net sales | $ 139,779 | $ 103,501 |
Fashion Apparel | Sales Revenue, Net | Product Concentration Risk | ||
Segment Reporting Information [Line Items] | ||
Percentage of net sales | 49.00% | 58.00% |
Dresses | ||
Segment Reporting Information [Line Items] | ||
Total net sales | $ 84,079 | $ 33,948 |
Dresses | Sales Revenue, Net | Product Concentration Risk | ||
Segment Reporting Information [Line Items] | ||
Percentage of net sales | 30.00% | 19.00% |
Handbags, Shoes and Accessories | ||
Segment Reporting Information [Line Items] | ||
Total net sales | $ 49,628 | $ 32,300 |
Handbags, Shoes and Accessories | Sales Revenue, Net | Product Concentration Risk | ||
Segment Reporting Information [Line Items] | ||
Percentage of net sales | 17.00% | 18.00% |
Beauty | ||
Segment Reporting Information [Line Items] | ||
Total net sales | $ 8,435 | $ 7,949 |
Beauty | Sales Revenue, Net | Product Concentration Risk | ||
Segment Reporting Information [Line Items] | ||
Percentage of net sales | 3.00% | 4.00% |
Other | ||
Segment Reporting Information [Line Items] | ||
Total net sales | $ 1,577 | $ 1,209 |
Other | Sales Revenue, Net | Product Concentration Risk | ||
Segment Reporting Information [Line Items] | ||
Percentage of net sales | 1.00% | 1.00% |
Detail of Certain Balance She_3
Detail of Certain Balance Sheet Accounts - Schedule of Prepaid Expenses and Other Current Assets (Details) - USD ($) $ in Thousands | Mar. 31, 2022 | Dec. 31, 2021 |
Prepaid Expense and Other Assets, Current [Abstract] | ||
Expected merchandise returns, net | $ 26,393 | $ 18,521 |
Advanced payments on inventory to be delivered from vendors | 13,712 | 13,059 |
Prepaid marketing | 8,505 | 2,746 |
Prepaid insurance | 1,001 | 1,859 |
Other | 8,516 | 5,929 |
Total prepaid expenses and other current assets | $ 58,127 | $ 42,114 |
Detail of Certain Balance She_4
Detail of Certain Balance Sheet Accounts - Schedule of Accrued Expenses (Details) - USD ($) $ in Thousands | Mar. 31, 2022 | Dec. 31, 2021 |
Accrued Liabilities, Current [Abstract] | ||
Marketing | $ 16,297 | $ 11,023 |
Sales taxes | 5,801 | 5,594 |
Salaries and related benefits | 5,438 | 8,216 |
Selling and distribution | 5,271 | 3,893 |
Other | 7,815 | 5,173 |
Total accrued expenses | $ 40,622 | $ 33,899 |
Detail of Certain Balance She_5
Detail of Certain Balance Sheet Accounts - Schedule of Other Current Liabilities (Details) - USD ($) $ in Thousands | Mar. 31, 2022 | Dec. 31, 2021 |
Other Liabilities, Current [Abstract] | ||
Store credit | $ 9,898 | $ 9,630 |
Gift cards | 3,129 | 2,977 |
REVOLVE Loyalty Club liability | 3,606 | 2,974 |
Other | 8,574 | 3,335 |
Total other current liabilities | $ 25,207 | $ 18,916 |