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Earnings call · Jul 2026 (Q2 FY27)

Torrid Holdings Q2 FY27 earnings call CURV

Sep 3, 2026 Source

Executive summary

Torrid Q2 FY27 — Customer File Growth and Marketing Engine Rebuild Drive July Inflection

Torrid's Q2 FY27 saw a significant inflection point in July, driven by a rebuilt marketing engine and strategic investments in customer acquisition and retention. Despite a challenging June, the company's focus on product assortment, sub-brand scaling, and optimized channels is translating into positive momentum, setting the stage for comparable sales growth in the back half of the year.

Highlights

5

  • Net sales of $231.7 million and adjusted EBITDA of $23.3 million (including tariff benefit) were in line with guidance.

  • Comparable sales inflected positively in July, with all 11 marketing channels improving sequentially.

  • Sub-brands delivered year-over-year growth of approximately 74% year-to-date, on track for $110 million in 2026 (60% growth over 2025).

  • Paid media revenue saw double-digit growth on significantly less spend, resulting in meaningful ROAS expansion.

  • Mobile app grew double digits year-over-year, with app-generated revenue reaching nearly 40% of digital revenue in July.

Concerns

3

  • Total company comparable sales declined 6.3% in Q2.

  • Gross margin, excluding tariff benefit, was 33.9%, down 170 basis points from a year ago, primarily reflecting targeted promotions.

  • Footwear was a headwind of roughly 100 basis points to comparable sales in Q2.

Guidance & targets

CategoryTargetConfidence
Full-year Net Sales
$940 million to $960 million
high materiality
High
Full-year Adjusted EBITDA
$76 million to $86 million
high materiality
High
Full-year Adjusted EBITDA (excluding tariff benefit)
$65 million to $75 million
high materiality
High
Full-year Marketing Investments
approximately 5.5% of sales
medium materiality
Medium
Q3 Net Sales
$230 million to $235 million
medium materiality
High
Q3 Adjusted EBITDA
$15 million to $20 million
medium materiality
High
Full-year Capital Expenditure
$8 million to $10 million
medium materiality
High
Sub-brand Sales
$110 million
medium materiality
High
Full-year Expense Savings from Store Optimization
approximately $40 million
medium materiality
High
Tariffs in Back Half
12% to 15%
medium materiality
Medium

CURV operating KPIs by quarter

CURV operating KPIs stated on its earnings calls, by fiscal quarter
KPI Apr 2026 Q1 FY27This call Jul 2026 Q2 FY27Change vs prior quarter
Stores closed
20 In Q1, we substantially completed our store optimization program with an additional 20 closures of structurally unproductive locations, bringing the total to 171 closures since we initiated the program. Source transcript
6 During the quarter, we closed 6 stores, ending the period with 457 stores compared to 575 stores a year ago, effectively completing our store optimization program. Source transcript
-70%

Operating figures the company states on every call, checked against each call's transcript. Click a figure to read the sentence. A dash means it was not stated that quarter.

Product announcements

ProductTypeDetails
Fashion at a Pricelaunch
Mobile App Capabilitiesupdate

Deals & partnerships

Macy's Third-party marketplace presence

Torrid is now live on Macy's marketplace since mid-July, operating on a model where Torrid owns and fulfills its own inventory.

Target Third-party marketplace presence

Torrid has recently gone live on Target marketplace, operating on a model where Torrid owns and fulfills its own inventory.

Walmart Third-party marketplace presence

Torrid will go live with Walmart marketplace later this year, operating on a model where Torrid owns and fulfills its own inventory.

Risks & headwinds

Challenging macro backdrop June (Q2 FY27)

June was a genuinely difficult month; elevated gas prices and other seasonal factors weighing on discretionary spending.

Mitigation:Business meaningfully improved as the quarter progressed, with July marking a significant pivot.

Footwear sourcing and assortment mix headwind Q2 FY27

Impact of roughly 100 basis points to comparable sales in Q2.

Mitigation:Resourcing of that assortment is complete, expected to turn to a tailwind in the second half of the year.

Tariff volatility H2 FY27

Outlook assumes tariffs of 12% to 15% in the back half of the year.

Mitigation:Outlook does not contemplate any further tariff volatility.

What to watch in Q3 FY27

Comparable sales growth

Back half of the year
Current -6.3% in Q2, positive inflection in July
Target Return to comparable sales growth

Why it matters

A return to positive comparable sales growth is a key indicator of the effectiveness of the company's strategic initiatives and overall business health.

We're confident it sets us up for a return to comparable sales growth in the back half of this year and beyond.

Q&A highlights

What specific factors (traffic, conversion, AUR, customer acquisition) drove the positive inflection in July?

The July inflection was driven by positive traffic and conversion across all 11 marketing channels, positive digital customer reactivation (low single-digit), and improved frequency within the active customer file.

“So July inflected positively. It was both traffic and conversion, but really a function of all 11 of our marketing channels inflecting positive. So we saw material movement in a positive direction across all 11 marketing channels. We saw digital customer reactivation positive, low single digit positive. And that was really the turning point, as well as frequency within our active file improving.”

asked by Corey Tarlowe · answered by Ashlee Wheeler

2 min read 6 chapters

Detailed narrative

Customer Growth Agenda & Marketing Engine Rebuild

Torrid's primary objective for FY27 is to grow its customer file through acquisition, reactivation, and retention. This is driven by a structural rebuild of the marketing engine, which has led to a positive inflection in comparable sales in July and sequential improvement across all 11 marketing channels. The company has invested in talent and standardized KPIs, real-time dashboards, and structured commercial business reviews to sustain this growth.

Product Assortment & Sub-Brand Performance

Course corrections in design and assortment have yielded positive results, with strength in knits and shorts, and momentum in dresses, activewear, and graphic tees. The 'Super Soft' fabric line is expanding due to positive customer response. Sub-brands are scaling ahead of plan, delivering approximately 74% year-over-year growth year-to-date and are on track to reach $110 million in 2026, representing 12% of total net sales.

Pricing Strategy & Marketplace Expansion

The opening price point (OPP) strategy now accounts for approximately 35% of the overall assortment, supporting conversion and basket growth with healthy product margins. A new 'Fashion at a Price' mid-tier category is also performing well. Torrid has expanded its presence on third-party marketplaces, going live on Macy's and Target, with Walmart planned for later this year, to drive incremental new customer acquisition.

Digital Channel Optimization & Mobile App Focus

Paid media saw double-digit revenue growth on significantly less spend, leading to meaningful ROAS expansion. Organic search revenue has been positive since June, with average search ranking improving over 3x and increased AI overview impressions. The mobile app is the fastest-growing digital channel, converting at approximately 7x the rate of desktop/web, and contributed nearly 40% of digital revenue in July due to enhanced engagement strategies.

CRM Initiatives & Community Engagement

CRM efforts are focused on personalized, targeted engagement to increase customer lifetime value, including a dedicated second purchase journey and lapse prevention series. The relaunched Casting Call platform is a key community-driven marketing initiative, attracting new and reactivated customers, increasing brand awareness by 9 percentage points in 2024, and improving social engagement and sentiment.

Store Optimization & Financial Discipline

The store optimization program is effectively complete, with an additional 6 structurally unproductive locations closed in Q2, bringing the total to 177 closures. Customer retention through these transitions has remained strong. The cost savings generated are being reinvested into growth initiatives, and the company realized $22 million of the projected $40 million full-year savings in the first half.

AI-generated summary of the company's earnings call. Not investment advice.