Tilly’s Reports Third Consecutive Quarter of Double-Digit Comparable Sales Growth
Tilly's (NYSE:TLYS) reported fiscal second-quarter net sales of $163.5 million, a year-over-year increase of 8.1%, with comparable net sales rising by 12.1%. This marks the third consecutive quarter of double-digit growth in comparable sales and extends Tilly’s streak to four quarters of positive performance across both physical stores (up 10.3%) and e-commerce (up 20.9%). Gross margin expanded significantly, reaching 35.5%, which helped generate $8.2 million in operating income with a 5% margin—substantially higher than the prior year's figures. Despite this strong quarter, Tilly’s first-half performance was weak, generating only $75,000 of operating income or nearly zero as a percentage of sales. The company is now betting on continued momentum to achieve annual profitability for the first time since 2022. Management expects third-quarter comparable net sales growth between 10% and 14%, with projected quarterly net income in the range of $2.2 million to $3.7 million, a marked improvement from last year’s loss. However, challenges remain as Tilly's has reduced its store count by 12 locations since this time last year, making comparable sales growth even more critical for overall revenue expansion. Additionally, rising SG&A expenses and potential margin pressures during the holiday season could pose risks to profitability.
Tickers: $TLYS
Topics: comparable sales growth operating income profitability retail