Reformation posts 24% revenue growth in first public quarter
Reformation reports $155.2 million in Q2 net revenue, driven by a 23% surge in active customers and a direct-to-consumer model that prioritizes speed over inventory volume.
Reformation reported second-quarter net revenue of $155.2 million, a 24% increase year-over-year, marking its first earnings report as a publicly traded company. The Los Angeles-based apparel firm also posted net income of $12.4 million for the period, underscoring its profitability amid a challenging retail environment.
According to data from GN markets/earnings (en-US), the company attributes this performance to a strong direct-to-consumer flywheel. Active customers grew by 23% during the quarter, with 70% of total revenue generated by repeat buyers. This retention strategy contrasts with peers like Everlane and Allbirds, which have struggled with customer retention and market share in recent years.
Repeat buyers drive revenue growth
CEO Hali Bornstein emphasized that the brand’s loyalty stems from its ability to respond quickly to consumer demand. Reformation operates with a high degree of vertical integration, sourcing 90% of its revenue from its website and owned stores. This model allows the company to bypass traditional wholesale lead times, enabling rapid testing and scaling of products based on real-time sales data.
The company’s supply chain agility is central to its financial results. More than half of Reformation’s product lines are produced within 60 days, significantly faster than the 12-month planning cycles common in the industry. This speed reduces inventory risk and allows the brand to maintain high sell-through rates, which supports its margin structure and cash flow.
Customer acquisition impacts per-unit spend
Despite strong top-line growth, DTC net revenue per customer decreased by 1.4% in the second quarter. This dip is a direct result of aggressive customer acquisition, as new buyers typically spend less in their first year than established customers. Bornstein noted that returning customers spent double what new customers did in 2025, highlighting the value disparity between segments.
Management expects this pressure on per-customer spend to be temporary. Bornstein stated that customer value increases significantly in the second year of ownership, with healthy year-over-year growth thereafter. The company views the current mix shift toward new customers as a necessary investment for long-term brand equity and future revenue expansion.
Store expansion targets global reach
Reformation ended the second quarter with 70 physical locations, of which only 10 are international. International markets contributed 20% of net revenue during the period. The company has outlined a strategy to double its store fleet over the next five years, focusing on both domestic and overseas expansion to capture new customer bases.
The brand is also broadening its demographic appeal. In 2025, 20% of new customers were under 25, while another 20% were over 50. Bornstein indicated that the brand attracts shoppers based on mindset rather than age, with three-quarters of customers shopping for their daughters also purchasing items for themselves. This multi-generational appeal supports the company’s growth trajectory beyond its core millennial audience.
