Reformation raises full-year guidance despite IPO-related net loss

Reformation has raised its full-year guidance after revenue increased 19.1% year on year to $173.6m (£128.5m) for the third quarter ended 26 September, according to Drapers. The US premium womenswear brand reported a net loss of $1.1m (£0.8m), against $5m (£3.7m) profit a year earlier, driven by IPO-related tax and share-based pay costs rather than weak trading.

Direct-to-consumer sales increased 16.7% to $152.8m (£113.1m), accounting for 88% of total sales. Wholesale and other revenue grew 40.8% to $20.8m (£15.4m), contributing the remaining 12%. Adjusted EBITDA rose 64.2% to $23.1m (£17.1m), with its margin expanding 366 basis points to 13.3%.

The company lifted full-year revenue guidance to $610m-$612m (£451m-£453m), from $602m-$606m (£445m-£448m). Its adjusted EBITDA margin guidance is about 14.2%, the high end of its previous range. Reformation began trading on the New York Stock Exchange in July.

Why it matters For fashion businesses and wholesale buyers, the results show faster growth in Reformation’s wholesale and other revenue, although direct-to-consumer remains its dominant channel. The higher guidance and adjusted EBITDA distinguish its trading performance from the IPO-related costs behind the net loss.