Why FIGS Shares Are Trading Lower Today
FIGS Inc (NYSE:FIGS) reported first-quarter FY22 sales growth of 26.4% year-on-year, to $110.10 million, missing the consensus of $116.92 million.
- Active customers grew 31.1% to 2 million, and the average order value increased 16% to $116.
- The gross margin contracted by 40 basis points to 71.2%, driven by higher air freight spending and increased ocean and air freight rates.
- The operating expenses rose 39.7% Y/Y to $64.7 million.
- The operating margin was 12.5%, and operating income for the quarter fell 14.4% to $13.7 million.
- The company held $189.4 million in cash and equivalents as of March 31, 2022.
- Adjusted EBITDA of $25 million increased by 2.6%, and the adjusted EBITDA margin contracted by 530 basis points to 22.7%.
- EPS of $0.05 missed the analyst consensus of $0.06.
Outlook: FIGS cuts FY22 sales outlook to $510 million - $530 million from $550 million - $560 million, versus the consensus of $556.5 million.
- The company expects an FY22 gross margin of 67% - 68%, versus the previous outlook of 70%+, primarily due to a significant increase in the use of air freight to help mitigate supply chain challenges.
Price Action: FIGS shares are trading lower by 23.9% at $9.78 in premarket on the last check Friday.
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