FIGS Raises Outlook as Revenue Growth Accelerates
Second-quarter net revenue reached $196.6 million as international and non-scrubwear sales expanded.
FIGS, Inc. (FIGS), the healthcare-apparel maker, raised its annual outlook after extending its run of revenue growth above 25% to a third consecutive quarter.
The quarter showed broader momentum across FIGS’ customer base. Active customers rose 13.2% to 3.097 million, accelerating from 12.2% growth in the first quarter, while average order value increased 8.5% to $127 as higher order volume and price and product mix supported sales.
Second-quarter net revenue rose 28.8% from a year earlier and increased about 23% sequentially. Net income climbed to $28.4 million, or $0.15 a diluted share, from $7.1 million, or $0.04 a share, a year earlier. The net margin widened to 14.4% from 4.7%.
International revenue grew 67% to $37.9 million, compared with 22.2% growth in the U.S., and accelerated from a 49.9% increase in the first quarter. Non-scrubwear revenue advanced 40.3% to $35.4 million, outpacing the 26.5% increase in scrubwear and reversing the category’s decline from a year earlier.
Gross margin expanded 8.2 percentage points to 75.2%, largely because FIGS recognized refunds tied to tariffs previously imposed under the International Emergency Economic Powers Act. Operating expenses rose 21.9%, though they declined as a share of revenue to 57.3% from 60.5%. Adjusted earnings before interest, taxes, depreciation and amortization increased to $36.6 million, with the adjusted margin widening to 18.6%; that measure excluded $7.9 million of refunds related to prior-year tariffs.
The stronger earnings also translated into cash generation. First-half operating cash flow improved to $43.7 million from negative $3.2 million a year earlier, while free cash flow reached $38.6 million after a $5.6 million outflow.
FIGS now expects full-year revenue growth of approximately 20%, up from its previous forecast of 14% to 16%. It projects an adjusted EBITDA margin of 14.8% to 15%, compared with its earlier range of 13% to 13.2%.
The board also added $100 million to the company’s share-repurchase authorization. About $19.2 million remained under the existing program at the end of June, giving FIGS additional capacity to return capital as its cash flow improved.