Latest news with #HezyShaked
Yahoo
5 days ago
- Business
- Yahoo
TLYS Q1 Earnings Call: Store Closures and Marketing Efforts Amid Ongoing Sales Decline
Young adult apparel retailer Tilly's (NYSE:TLYS) missed Wall Street's revenue expectations in Q1 CY2025, with sales falling 7.1% year on year to $107.6 million. Its GAAP loss of $0.74 per share decreased from -$0.65 in the same quarter last year. Is now the time to buy TLYS? Find out in our full research report (it's free). Revenue: $107.6 million (7.1% year-on-year decline) Revenue Guidance for Q2 CY2025 is $154 million at the midpoint, above analyst estimates of $147.2 million Operating Margin: -21.1%, down from -16.5% in the same quarter last year Locations: 238 at quarter end, down from 246 in the same quarter last year Same-Store Sales fell 7.1% year on year (-8.6% in the same quarter last year) Market Capitalization: $39.2 million Tilly's management attributed first quarter results to continued softness in store traffic and overall sales, despite some sequential improvement compared to prior periods. Executive Vice President and CFO Michael Henry noted that while comparable net sales were down 7%, this was better than the 11.2% decline in the previous quarter, suggesting potential stabilization. Management pointed to improvements in merchandise assortment and increased marketing efforts, such as the launch of Tilly's TikTok shop and high-profile in-store events, as contributing to this relative outperformance. CEO Hezy Shaked commented that the company has seen consistent traffic gains in recent weeks, particularly in the junior segment, but cautioned that more work is needed to sustain these trends. Looking forward, Tilly's is focused on capitalizing on the upcoming back-to-school season and maintaining progress in merchandise and customer engagement. Management believes that product selection is increasingly resonating with younger consumers and expects further benefit from recent marketing initiatives. CFO Michael Henry highlighted that May sales trends have improved to a 2.2% decline, and the company anticipates that the peak sales period in late July could drive stronger results. While tariff exposure remains a risk, current assessments suggest minimal impact on product margins for the remainder of the year. CEO Hezy Shaked expressed cautious optimism for the next six months, emphasizing ongoing efforts to improve both inventory positioning and in-store experience. Management identified improved merchandise assortment, digital engagement, and event-driven marketing as key factors behind the quarter's sequential sales improvement, while also acknowledging ongoing pressures from store closures and external uncertainties. Merchandise Assortment Progress: Management reported that recent changes to product mix, particularly in the junior category, have led to better sales performance and customer response. CEO Hezy Shaked noted that merchandise is 'looking better' and 'selling better,' attributing recent traffic improvements to these adjustments. Digital Engagement Expansion: The introduction of the Tilly's TikTok shop in March has provided a new e-commerce channel, which the company claims began outperforming Amazon orders by mid-April. Management sees this as an important step to reach younger shoppers who are increasingly active on social media platforms. Event-Driven Marketing Initiatives: Tilly's hosted several in-person events, including celebrity appearances and collaborations with influencers, to strengthen its brand association with youth culture. These activities, particularly during festival season, are intended to drive store traffic and reinforce the company's position at the intersection of fashion and music. Store Optimization and Closures: The company closed eight stores year-over-year and plans further closures depending on lease negotiations. CFO Michael Henry highlighted that ongoing store rationalization is expected to reduce occupancy costs, but acknowledged that future cost leverage will depend on sales trends. Tariff and Cost Management: While tariffs on imported goods remain a concern, management indicated that the current impact on product costs is minor, with efforts underway to mitigate risks through supplier collaboration. Michael Henry stated that product margins are expected to remain stable barring significant changes in tariff policy. Tilly's outlook is shaped by efforts to stabilize sales trends, execute marketing strategies, and navigate macroeconomic headwinds in the coming quarters. Back-to-School Season Importance: Management emphasized that the final weeks of the second quarter, coinciding with the back-to-school shopping period, historically generate the highest sales volume. The company is relying on this seasonal lift to potentially offset ongoing traffic and transaction declines. Store Footprint Adjustments: Tilly's plans to close multiple additional stores in the next two quarters, with up to 15 more closures possible depending on lease renewals. Management believes that a leaner store base could help control costs, though it presents risks to overall reach and sales volume. Tariff and Inventory Risk: The company continues to monitor tariff developments, which could affect product costs over time. Current inventory levels are lower than last year, positioning Tilly's to be more agile, but ongoing macroeconomic uncertainty and changing consumer preferences present continued risks to profitability. In the quarters ahead, the StockStory team will be watching (1) whether Tilly's can sustain recent sequential improvements in comparable sales through the back-to-school period, (2) the impact of continued store closures on both cost structure and overall sales, and (3) how digital and event-driven marketing initiatives translate into higher customer engagement and transaction growth. Changes in tariff policy and consumer spending patterns will also be important factors to monitor. Tilly's currently trades at a trailing 12-month price-to-sales ratio of 0.1×. In the wake of earnings, is it a buy or sell? Find out in our full research report (it's free). 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 5 Strong Momentum 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 Kadant (+351% five-year return). Find your next big winner with StockStory today.
Yahoo
6 days ago
- Business
- Yahoo
Tilly's (NYSE:TLYS) Misses Q1 Revenue Estimates, But Stock Soars 12%
Young adult apparel retailer Tilly's (NYSE:TLYS) missed Wall Street's revenue expectations in Q1 CY2025, with sales falling 7.1% year on year to $107.6 million. On the other hand, next quarter's outlook exceeded expectations with revenue guided to $154 million at the midpoint, or 4.6% above analysts' estimates. Its GAAP loss of $0.74 per share was 12.1% below analysts' consensus estimates. Is now the time to buy Tilly's? Find out in our full research report. Revenue: $107.6 million vs analyst estimates of $108.2 million (7.1% year-on-year decline, 0.5% miss) EPS (GAAP): -$0.74 vs analyst expectations of -$0.66 (12.1% miss) Adjusted EBITDA: -$19.86 million vs analyst estimates of -$17.43 million (-18.5% margin, 14% miss) Revenue Guidance for Q2 CY2025 is $154 million at the midpoint, above analyst estimates of $147.2 million EPS (GAAP) guidance for Q2 CY2025 is -$0.01 at the midpoint, beating analyst estimates by 81.8% Operating Margin: -21.1%, down from -16.5% in the same quarter last year Free Cash Flow was -$9.64 million compared to -$27.83 million in the same quarter last year Locations: 238 at quarter end, down from 246 in the same quarter last year Same-Store Sales fell 7.1% year on year (-8.6% in the same quarter last year) Market Capitalization: $40.4 million "Our fiscal 2025 first quarter comparable net sales, while a decrease compared to last year's first quarter, were a sequential improvement in trend compared to the fourth quarter of fiscal 2024. Fiscal May, to start the second quarter, produced further sequential trend improvement relative to the first quarter," commented Hezy Shaked, President and Chief Executive Officer. With an emphasis on skate and surf culture, Tilly's (NYSE:TLYS) is a specialty retailer that sells clothing, footwear, and accessories geared towards fashion-forward teens and young adults. Examining a company's long-term performance can provide clues about its quality. Any business can put up a good quarter or two, but many enduring ones grow for years. With $561.2 million in revenue over the past 12 months, Tilly's is a small retailer, which sometimes brings disadvantages compared to larger competitors benefiting from economies of scale and negotiating leverage with suppliers. As you can see below, Tilly's struggled to generate demand over the last six years (we compare to 2019 to normalize for COVID-19 impacts). Its sales dropped by 1.2% annually as it didn't open many new stores and observed lower sales at existing, established locations. This quarter, Tilly's missed Wall Street's estimates and reported a rather uninspiring 7.1% year-on-year revenue decline, generating $107.6 million of revenue. Company management is currently guiding for a 5.4% year-on-year decline in sales next quarter. We also like to judge companies based on their projected revenue growth, but not enough Wall Street analysts cover the company for it to have reliable consensus estimates. Software is eating the world and there is virtually no industry left that has been untouched by it. That drives increasing demand for tools helping software developers do their jobs, whether it be monitoring critical cloud infrastructure, integrating audio and video functionality, or ensuring smooth content streaming. Click here to access a free report on our 3 favorite stocks to play this generational megatrend. A retailer's store count influences how much it can sell and how quickly revenue can grow. Tilly's listed 238 locations in the latest quarter and has kept its store count flat over the last two years while other consumer retail businesses have opted for growth. When a retailer keeps its store footprint steady, it usually means demand is stable and it's focusing on operational efficiency to increase profitability. The change in a company's store base only tells one side of the story. The other is the performance of its existing locations and e-commerce sales, which informs management teams whether they should expand or downsize their physical footprints. Same-store sales is an industry measure of whether revenue is growing at those existing stores and is driven by customer visits (often called traffic) and the average spending per customer (ticket). Tilly's demand has been shrinking over the last two years as its same-store sales have averaged 7% annual declines. This performance isn't ideal, and we'd be concerned if Tilly's starts opening new stores to artificially boost revenue growth. In the latest quarter, Tilly's same-store sales fell by 7.1% year on year. This performance was more or less in line with its historical levels. We were impressed by Tilly's optimistic revenue and EPS guidance for next quarter, which blew past analysts' expectations. On the other hand, this quarter's revenue, EPS, and EBITDA fell short of Wall Street's estimates. Zooming out, we think this was a mixed quarter. The stock traded up 12% to $1.49 immediately after reporting. So do we think Tilly's is an attractive buy at the current price? When making that decision, it's important to consider its valuation, business qualities, as well as what has happened in the latest quarter. We cover that in our actionable full research report which you can read here, it's free. 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Business Wire
6 days ago
- Business
- Business Wire
Tilly's, Inc. Reports Fiscal 2025 First Quarter Operating Results
IRVINE, Calif.--(BUSINESS WIRE)--Tilly's, Inc. (NYSE: TLYS, the "Company") today announced financial results for the first quarter of fiscal 2025 ended May 3, 2025. "Our fiscal 2025 first quarter comparable net sales, while a decrease compared to last year's first quarter, were a sequential improvement in trend compared to the fourth quarter of fiscal 2024. Fiscal May, to start the second quarter, produced further sequential trend improvement relative to the first quarter," commented Hezy Shaked, President and Chief Executive Officer. "We believe our merchandise assortment is on trend, and we are encouraged by these signs that our business may be starting to stabilize. We continue to seek opportunities to accelerate progress toward improving our business." Operating Results Overview Fiscal 2025 First Quarter Operating Results Overview The following comparisons refer to the Company's operating results for the first quarter of fiscal 2025 ended May 3, 2025 versus the first quarter of fiscal 2024 ended May 4, 2024. Total net sales were $107.6 million, a decrease of 7.1%. Total comparable net sales, including both physical stores and e-commerce ("e-com"), decreased by 7.0% relative to the comparable 13-week period ended May 4, 2024. This result represented a 4.2 comp point improvement in sequential trend from fiscal 2024's fourth quarter comparable net sales decrease of 11.2% Net sales from physical stores were $85.9 million, a decrease of 7.4%. Comparable store net sales decreased 7.1% relative to the comparable 13-week period ended May 4, 2024. Net sales from physical stores represented 79.8% of total net sales this year compared to 80.1% of total net sales last year. The Company ended the first quarter with 238 total stores compared to 246 total stores at the end of the first quarter last year. Net sales from e-com were $21.7 million, a decrease of 5.8%. E-com net sales decreased 6.6% relative to the comparable 13-week period ended May 4, 2024. E-com net sales represented 20.2% of total net sales this year compared to 19.9% of total net sales last year. Gross profit, including buying, distribution, and occupancy costs, was $21.3 million, or 19.8% of net sales, compared to $24.3 million, or 21.0% of net sales, last year. Product margins improved by 40 basis points primarily due to improved initial markups, partially offset by increased inventory valuation reserves. Buying, distribution, and occupancy costs deleveraged by 160 basis points collectively, despite being $0.8 million lower than last year, primarily due to carrying these costs against a lower level of net sales this year. Selling, general and administrative ("SG&A") expenses were $44.0 million, or 40.9% of net sales, compared to $45.1 million, or 38.9% of net sales, last year. The $1.1 million decrease in SG&A was primarily attributable to a decrease in store payroll and related benefits of $0.9 million and lower non-cash asset write-down charges of $0.5 million, partially offset by an increase in marketing expenses of $0.7 million. SG&A deleveraged by 190 basis points as a result of carrying these costs against a lower level of net sales this year. Operating loss was $22.7 million, or 21.1% of net sales, compared to $20.8 million, or 17.9% of net sales, last year, due to the combined impact of the factors noted above. Income tax benefit was $0.1 million, or 0.6% of pre-tax loss, compared to $13 thousand, or 0.1% of pre-tax loss, last year. Both years' income tax results include the continuing impact of a full, non-cash deferred tax asset valuation allowance. This year's income tax benefit also includes the refund of certain income tax credit carry forwards and state income tax carry back claims. Net loss was $22.2 million, or $0.74 per share, compared to $19.6 million, or $0.65 per share, last year. Weighted average shares were 30.1 million this year compared to 30.0 million shares last year. Balance Sheet and Liquidity As of May 3, 2025, the Company had $37.2 million of cash, cash equivalents and marketable securities and $55.4 million of available, undrawn borrowing capacity under its asset-backed credit facility. Total inventories decreased by 3.8% as of May 3, 2025 compared to May 4, 2024. Total year-to-date capital expenditures at the end of the first quarter were $1.5 million this year compared to $2.1 million at the end of the first quarter of fiscal 2024. Fiscal 2025 Second Quarter Outlook Total comparable net sales for fiscal May ended May 31, 2025 decreased by 2.2% relative to the comparable period of last year. Based on current and historical trends, the Company currently estimates the following for the second quarter of fiscal 2025 ending August 2, 2025: Net sales in the range of approximately $150 million to $158 million, translating to an estimated comparable net sales range of a decrease of 5% to flat, respectively, relative to the comparable period last year; SG&A expenses in the range of approximately $48 million to $49 million, excluding any potential non-cash asset impairment charges that may arise; Net loss of approximately $2.7 million to net income of approximately $2.0 million, respectively, with a near-zero effective income tax rate due to the continuing impact of a full, non-cash valuation allowance on deferred tax assets; and Per share results to be in the range of a net loss of $0.09 to net income of $0.07, respectively. Total quarter-ending store count of 232 compared to 247 at the end of last year's second quarter, with seven store closures and one new store opening during the quarter. At this time, the Company expects to close two additional stores in the third quarter and there are potentially 15 additional store closures which could occur toward the end of the fiscal year depending on the outcome of lease renewal negotiations with landlords. Total quarter-ending liquidity of approximately $106 million to $111 million with no debt, comprised of total cash, cash equivalents and marketable securities in the range of approximately $43 million to $48 million, and available, undrawn borrowing capacity of approximately $63 million under its asset-backed credit facility. Based on its current projections, the Company does not anticipate needing to initiate borrowings under its credit facility at any time during fiscal 2025. The Company estimates it would take a consistent comparable net sales decrease of approximately 10% or more over the course of the remainder of the year to require any level of borrowing this year. Conference Call Information A conference call with analysts to discuss these financial results is scheduled for today, June 4, 2025, at 4:30 p.m. ET (1:30 p.m. PT). Analysts interested in participating in the call are invited to dial (877) 300-8521 (domestic) or (412) 317-6026 (international). The conference call will also be available to interested parties through a live webcast at Please visit the website and select the 'Investor Relations' link at least 15 minutes prior to the start of the call to register and download any necessary software. A telephone replay of the call will be available until June 11, 2025, by dialing (844) 512-2921 (domestic) or (412) 317-6671 (international) and entering the conference identification number: 10199579. About Tillys Tillys is a destination specialty retailer of casual apparel, footwear, and accessories for young men, young women, boys and girls with an extensive selection of iconic global, emerging, and proprietary brands rooted in an active, outdoor and social lifestyle. Tillys is headquartered in Irvine, California and currently operates 234 total stores across 33 states, as well as its website, Forward-Looking Statements Certain statements in this press release are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. In particular, statements regarding our current operating expectations in light of historical results, the improvement in our comparable net sales trend and our ability to maintain or improve upon it, the impacts of inflation, tariffs, and potential recession on us and our customers, including on our future financial condition or operating results, expectations regarding changes in the macro-economic environment, customer traffic, our supply chain, our ability to properly manage our inventory levels, and any other statements about our future cash position, financial flexibility, expectations, plans, intentions, beliefs or prospects expressed by management are forward-looking statements. These forward-looking statements are based on management's current expectations and beliefs, but they involve a number of risks and uncertainties that could cause actual results or events to differ materially from those indicated by such forward-looking statements, including, but not limited to the impact of inflation on consumer behavior and our business and operations, supply chain difficulties, and our ability to respond thereto, our ability to respond to changing customer preferences and trends, attract customer traffic at our stores and online, execute our growth and long-term strategies, expand into new markets, grow our e-commerce business, effectively manage our inventory and costs, effectively compete with other retailers, attract talented employees, or enhance awareness of our brand and brand image, general consumer spending patterns and levels, including changes in historical spending patterns, the markets generally, our ability to satisfy our financial obligations, including under our credit facility and our leases, and other factors that are detailed in our Annual Report on Form 10-K, filed with the Securities and Exchange Commission ('SEC'), including those detailed in the section titled 'Risk Factors' and in our other filings with the SEC, which are available on the SEC's website at and on our website at under the heading 'Investor Relations'. Readers are urged not to place undue reliance on these forward-looking statements, which speak only as of the date of this press release. We do not undertake any obligation to update or alter any forward-looking statements, whether as a result of new information, future events or otherwise. This release should be read in conjunction with our financial statements and notes thereto contained in our Form 10-K. ASSETS Current assets: Cash and cash equivalents $ 27,231 $ 21,056 $ 19,880 Marketable securities 9,973 25,653 48,142 Receivables 4,914 4,094 7,135 Merchandise inventories 75,572 69,178 78,535 Prepaid expenses and other current assets 9,297 10,979 9,742 Total current assets 126,987 130,960 163,434 Operating lease assets 167,369 169,805 199,613 Property and equipment, net 37,876 40,139 45,442 Other assets 1,919 1,559 1,522 TOTAL ASSETS $ 334,151 $ 342,463 $ 410,011 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable $ 31,778 $ 11,120 $ 22,013 Accrued expenses 12,317 12,750 12,712 Deferred revenue 13,305 14,116 14,127 Accrued compensation and benefits 7,537 9,418 8,457 Current portion of operating lease liabilities 47,931 48,384 52,662 Current portion of operating lease liabilities, related party 3,501 3,423 3,194 Other liabilities 141 172 253 Total current liabilities 116,510 99,383 113,418 Long-term liabilities: Noncurrent portion of operating lease liabilities 123,452 126,216 151,875 Noncurrent portion of operating lease liabilities, related party 14,937 15,844 18,438 Other liabilities 137 149 278 Total long-term liabilities 138,526 142,209 170,591 Total liabilities 255,036 241,592 284,009 Stockholders' equity: Common stock (Class A) 23 23 23 Common stock (Class B) 7 7 7 Preferred stock — — — Additional paid-in capital 175,269 174,829 173,197 Accumulated deficit (96,343 ) (74,191 ) (47,583 ) Accumulated other comprehensive income 159 203 358 Total stockholders' equity 79,115 100,871 126,002 TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 334,151 $ 342,463 $ 410,011 Expand Tilly's, Inc. Consolidated Statements of Operations (In thousands, except per share data) (unaudited) Tilly's, Inc. Consolidated Statements of Cash Flows (In thousands) (unaudited) Tilly's, Inc. Store Count and Square Footage Store Count at Beginning of Quarter New Stores Opened During Quarter Stores Permanently Closed During Quarter Store Count at End of Quarter Total Gross Square Footage End of Quarter (in thousands) 2024 Q1 248 2 4 246 1,784 2024 Q2 246 1 — 247 1,791 2024 Q3 247 — 1 246 1,780 2024 Q4 246 4 10 240 1,730 2025 Q1 240 1 3 238 1,707 Expand
