Aritzia reports 7.8% Q1 revenue growth amid net loss | kbnmart

Canadian fashion retailer Aritzia Inc. reported a 7.8% increase in net revenue for the first quarter ended June 2, 2024, while posting a net loss.

The Vancouver-based company said net revenue was $498.6 million, with comparable sales growing 2%, compared with $462.7 million in the first quarter of 2024.

By region, net revenue in the United States increased 13% to $284.7 million, representing 57.1% of net revenue, driven by the company’s real estate expansion strategy and increased brand awareness. Meanwhile, in Canada, the brand’s home country, net revenue increased 1.5% to $214.0 million.

Aritzia’s net retail revenue increased 9.2% to $357.8 million, driven by strong performance from the company’s new and repositioned stores, as well as positive comparable sales growth across its stores. Over the past 12 months, the company opened 5 new stores and repositioned 4 more.

Similarly, net e-commerce revenue increased 4.2% to $140.8 million, accounting for 28.2% of net revenue.

The retailer reported a 9.4% decline in net income, which fell to $15.8 million. Net income per diluted share was $0.14 per share, compared to $0.15 per share in the first quarter of 2024.

“We are pleased with our performance in the first quarter of fiscal 2025, delivering an 8% increase in net revenue compared to the first quarter of fiscal 2024 and achieving positive comparable sales growth across all geographies and channels,” said Jennifer Wong, CEO of the company.

“Our net revenue growth was driven by a 13% increase in U.S. net revenue, driven by our strategy to expand into real estate and increase brand awareness. During the quarter, we continued to improve our inventory mix, which led to a sequential acceleration in sales trends each month. As expected, we also delivered a significant improvement in adjusted EBITDA margin.”

Looking ahead, Aritzia expects net revenue in the range of $570 million to $590 million in the second quarter of fiscal year 2025, representing growth of approximately 7% to 10%. For the full fiscal year, Aritzia expects net revenue to be between $2.52 billion and $2.62 billion, representing growth of approximately 8% to 12% from fiscal year 2024.

“As we navigate a dynamic consumer environment, we are encouraged by the positive response to both our new styles and customer-favorite products,” Wong added. “Our new stores continue to outperform expectations, and we are particularly excited about our exceptional store opening pipeline this year, which represents 50% square footage growth in the U.S..”

“We expect further improvement in our e-commerce business driven by product enhancements and strategic investments. We are confident that our real estate expansion strategy, digital initiatives and growing brand awareness in the US will enable us to achieve consistent and profitable growth for years to come.”