Torrid’s first quarter results reflected a continued shift in consumer shopping preferences and strategic execution of its digital and sub-brand initiatives. Management pointed to the growing importance of online channels, with digital sales nearing 70% of total demand, and emphasized the success of new sub-brands in attracting younger and lapsed customers. CEO Lisa Harper noted, “Performance of our sub-brands continues to reinforce our belief that the strategy is working,” highlighting that these offerings are outperforming expectations and generating higher margins. The company also advanced its store optimization plan, closing underperforming locations to streamline its footprint and reallocate resources to digital growth.
Is now the time to buy CURV? Find out in our full research report (it’s free).
Torrid (CURV) Q1 CY2025 Highlights:
- Revenue: $266 million vs analyst estimates of $270.2 million (4.9% year-on-year decline, 1.6% miss)
- Adjusted EPS: $0.06 vs analyst estimates of $0.05 ($0.02 beat)
- Adjusted EBITDA: $27.13 million vs analyst estimates of $27.15 million (10.2% margin, in line)
- The company dropped its revenue guidance for the full year to $1.04 billion at the midpoint from $1.09 billion, a 4.4% decrease
- EBITDA guidance for the full year is $100 million at the midpoint, below analyst estimates of $101.6 million
- Operating Margin: 6%, down from 9.3% in the same quarter last year
- Locations: 632 at quarter end, down from 658 in the same quarter last year
- Same-Store Sales fell 3.5% year on year (-9% in the same quarter last year)
- Market Capitalization: $290 million
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions Torrid’s Q1 Earnings Call
- Mary (Bank of America): Asked about the cadence of new sub-brand launches for the remainder of the year. CEO Lisa Harper outlined upcoming launches and plans to accelerate monthly drops across all sub-brands by year-end.
- Savannah Summer (Goldman Sachs): Inquired about new customer trends following sub-brand purchases and differences in behavior by channel. Chief Strategy Officer Ashlee Wheeler pointed to strong cross-shopping, high transaction sizes, and a predominance of online engagement among new and existing customers.
- Katie Delahunt (Morgan Stanley): Sought clarity on the expected sales deceleration in Q2. CFO Paula Dempsey attributed it primarily to the pause in footwear, which is spread evenly throughout the year, and Harper highlighted continued choppy customer behavior.
- Dylan Carden (William Blair): Asked about the promotional strategy and the rationale for accelerated store closures. Wheeler confirmed that promotional activity remains consistent with past years and Harper detailed the decision to realign the store portfolio based on online preference trends.
- Dylan Carden (William Blair): Further questioned how Torrid achieves negligible sales impact from closures. Harper explained that most closures are low-volume stores and that increased marketing and digital migration are expected to offset lost sales.
Catalysts in Upcoming Quarters
In coming quarters, the StockStory team will closely track (1) the execution and impact of accelerated store closures and customer migration to digital channels, (2) the performance and customer response to new sub-brand launches and increased delivery cadence, and (3) the effectiveness of tariff mitigation and expense reduction initiatives. Additional attention will be paid to the company’s ability to sustain margin improvement despite ongoing macroeconomic pressures and category adjustments.
Torrid currently trades at $2.74, down from $4.99 just before the earnings. At this price, is it a buy or sell? See for yourself in our full research report (it’s free).
The Best Stocks for High-Quality Investors
Market indices reached historic highs following Donald Trump’s presidential victory in November 2024, but the outlook for 2025 is clouded by new trade policies that could impact business confidence and growth.
While this has caused many investors to adopt a "fearful" wait-and-see approach, we’re leaning into our best ideas that can grow regardless of the political or macroeconomic climate. Take advantage of Mr. Market by checking out our Top 6 Stocks for this week. This is a curated list of our High Quality stocks that have generated a market-beating return of 183% over the last five years (as of March 31st 2025).
Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-micro-cap company Tecnoglass (+1,754% five-year return). Find your next big winner with StockStory today.
