IYouth apparel retailer Tilly’s Inc. on March 11 reported its first profitable fourth quarter in four years.
“Our positive comparable store net sales momentum accelerated in the fourth quarter of fiscal 2025 and produced our first profitable fourth quarter and full-year positive comp sales since fiscal 2021,” Chief Executive Nate Smith said in a statement.
Irvine-based Tilly’s reported net sales of $155 million for the fiscal quarter ended Jan. 31, up 5.3% from the year before, beating one analyst’s estimate of $149 million in revenue.
Total same-store sales (SSS) increased 10% in the fourth quarter. Tilly’s said the fiscal fourth quarter “surpassed” its previous expectations from early December.
“We have meaningfully improved our merchandise assortments and evolved our brand and digital marketing efforts to improve our customer engagement,” Smith told analysts on the earnings call.
“Additionally, we have closed underperforming stores and sustained solid operational execution, delivering significantly improved results compared to last year.”
The report showcased a remarkable turnaround for the Irvine-based retailer that caters to teenagers. After long-time CEO Ed Thomas unexpectedly left in early 2024, co-founder and Chairman Hezy Shaked stepped in for more than a year, and last May, the shares hit an all-time low of 57 cents. After Smith started his position in August, he brought in influencer Loren Gray, who has a reported 53 million followers online, earning the moniker, “The Queen of TikTok.”
The day after the March 11 report, Tilly’s surged 48% to $2.42 per share. By March 20, shares hit a 52-week high of $3.94 apiece, up 141% in a span of seven trading sessions, with a market cap of $115 million (NYSE: TLYS).
Tilly’s stock is still down from trading over $23 per share in 2018.
Seven Straight Months
The retailer has posted same-store sales growth for seven consecutive months, according to Smith, who also revealed that Tilly’s total SSS for February, the first month of fiscal 2026, grew 20%.
Based on these results, Tilly’s forecast for fiscal Q1 net sales is in the range of approximately $119 million to $125 million, indicating a possible increase of 16% to 22%.
With improvements in merchandising and store economics driven by marketing efforts and infrastructure investments, Tilly’s says its improvement plans are working. However, the company has yet to generate annual growth.
“We are not yet profitable on an annualized basis, but we see a clear path to get there after generating profit in two of the last three quarters,” Smith told analysts.
Net sales for fiscal 2025 were $553.6 million, off 2.8% from a year ago. Chief Financial Officer Mike Henry said that Tilly’s estimates, “for illustrative purposes,” it could begin to generate profitability in fiscal 2026 with an estimated same-store sales increase of approximately 8% to 9%.
“We believe our turnaround is real, the fundamentals are fixed, our top line is growing, we are looking to reinitiate store growth, and we must continue to build upon the progress made thus far,” Smith said.
The company ended the fourth quarter with 223 total locations, down 17 stores compared to last year’s Q4.
“In terms of store real estate, with the improved store comp trends we have seen over the last seven months and counting, and because our unit economics support it, we are now pivoting from a store closure posture to a disciplined approach to new store openings in fiscal 2026, with a plan to open four to six new stores,” Smith told analysts.
