12/28/2023 0 Comments Revolve return order![]() The figure was calculated assuming 58 million women ages 18 to 44 are in the US. As of 3Q21, it claims it has penetrated less than 3% of its addressable market. I believe Revolve will add customers at a slightly lower rate over the next few years. During 2022, active customers grew 27% to 2.3 million. My model forecasts a more conservative growth rate of 15%, with growth coming from a combination of customer adds, an increase in orders placed, and an increase in average order value slowing economic growth will be a headwind.įirstly, Revolve should be able to achieve a 15% annual revenue growth rate because its addressable market is large and growing, and therefore it has ample opportunity to add new customers. Management's goal is to grow revenue by 20% annually. ![]() Quantitative Attribution Growth Prospects These figures are well above industry standards and contribute to Revolve’s strong gross margin, which is also above many retail peers. ![]() The figure was in the high 70s from 2018 to 2020 and was 85% in 2022, as shown in the recent earnings presentation. One metric that the management team at Revolve refers to when analyzing the efficacy of the algorithms is its full-price mix of net sales. The two were “quick to realize early the importance of relying on data and analytics." They claim their approach facilitates what they refer to as “constant newness,” with over 1,500 new styles launched per week on average in 2022. The management team claims in its 10-K, “Our proprietary technology leverages data from a vast net of styles, attributes, and customer interactions to create a strategic asset of hundreds of millions of data points.” The two founders, who still run the company, have a background in computer engineering and business. Revolve built a custom, proprietary technology platform that delivers automated inventory management, pricing, and trend-forecasting algorithms. Revolve also differentiates from competitors by taking a data/technology-driven approach to running the business. Revolve’s social media accounts can achieve billions of impressions per day during its largest marketing event, Revolve Festival. In its 10-K, Revolve claims it works with celebrities and thousands of social media influencers. Revolve differentiates itself from competitors by employing mass social media marketing. In 2022, Revolve achieved revenue of $1.1 billion against $59 million in earnings. Revolve is a fashion and cosmetics retailer for Millennial and Generation Z consumers. In this article, I address this issue and explain what needs to happen for it to alleviate. However, shipping costs have been restricting the latter. I am confident Revolve's management team will continue to deliver a strong offering and shopping experience to customers and create value for shareholders. Humans have always been enthralled by fashion, and Revolve offers a trendy curation and seamless online apparel shopping experience. As a shareholder, it comforts me to know that millions of dollars of merchandise is leaving Revolve's warehouse on a daily basis. I have long admired Revolve ( NYSE: RVLV) and its management team. Revolve is One Step From Achieving Exceptional Profits
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