Reformation Q2 Revenue Beats IPO Estimates

Reformation Inc. (NYSE: REF) reported second-quarter 2026 net revenue of $155.2 million, a 24.1% increase year over year. This performance exceeded the high end of the estimates provided during the company's initial public offering. Net income rose to $12.4 million from $6.9 million in the prior-year period, while adjusted EBITDA climbed 54% to $25.4 million. The adjusted EBITDA margin expanded to 16.4%, up from 13.2% a year earlier, marking the 21st consecutive quarter of double-digit revenue growth for the sustainable fashion brand.

The company maintained its full-year 2026 financial outlook as part of its earnings release, as noted in reporting by GN markets/earnings (en-US). Reformation expects total revenue between $602 million and $606 million. It projects adjusted EBITDA margins of 14% to 14.2% and plans to end the year with 79 to 80 stores. Following its listing, the firm utilized approximately $110 million of IPO proceeds to reduce outstanding debt, improving its balance sheet position.

Customer Base Expansion Drives DTC

Direct-to-consumer net revenue increased 21.2% to $135.3 million, supported by a 23% rise in the trailing-12-month active customer base to 1.2 million. Chief Executive Officer Hali Borenstein attributed this growth to both new customer acquisitions and sustained engagement from returning shoppers. However, DTC net revenue per customer declined 1.4% year over year to $417. Management cited the rapid influx of new customers, who typically have lower initial spend, as the primary driver for this metric decrease.

Long-term customer value remains a key performance indicator for the business. Borenstein noted that returning customers spent nearly twice as much as new customers in 2025. The company retained 80% of revenue on a one-year basis and 98% on a two-year basis. Approximately 70% of 2025 revenue originated from repeat customers. Shoppers who utilize both physical stores and e-commerce channels represented 34% of revenue and spent 3.1 times more than single-channel customers.

Wholesale And International Segments Accelerate

Wholesale and other revenue grew 48.7% to $19.9 million, outpacing total company growth. Chief Financial Officer Joshua Moore stated that strong market response to spring and summer collections increased order volumes from existing partners. Despite this growth, Reformation maintains a selective approach, prioritizing broader assortments and additional doors with current accounts over rapid expansion. The company expects to add one or two new strategic wholesale partners in coming quarters to access new markets.

International revenue advanced 36.8% to $31.2 million, accounting for approximately 20% of second-quarter sales. Growth was driven by performance in core markets including the United Kingdom, Canada, and France. Reformation currently operates 70 stores and plans to open nine to 10 additional locations in the second half of the year. This physical expansion supports the company's goal of reaching a year-end store count of 79 to 80.

Sustained Profitability Amid Growth

The combination of broad-based growth and operational efficiency resulted in profitability above previous internal benchmarks. Net income of $12.4 million reflects improved margin structures compared to the $6.9 million reported in the same quarter last year. The 54% increase in adjusted EBITDA demonstrates the company's ability to scale operations while maintaining cost discipline. This financial trajectory validates the business model presented during the IPO and provides a foundation for continued investment in product and retail infrastructure.