Tilly's Reports 15.9% Revenue Growth with Improved Gross Profit in Q1 Fiscal 2026

Tilly's, Inc. reported a notable improvement in its financial performance for the first quarter of fiscal 2026, ending May 2, 2026. The company achieved net sales of $124.7 million, reflecting a 15.9% increase from $107.6 million in the same period last year. This growth was driven by a 12.1% rise in sales from physical stores, which totaled $96.3 million, and a significant 30.9% increase in e-commerce sales, reaching $28.4 million. Despite the increase in sales, Tilly's reported a net loss of $8.0 million, or $0.26 per share, compared to a net loss of $22.2 million, or $0.74 per share, in the prior year.

The company's gross profit also improved significantly, rising to $36.1 million, or 28.9% of net sales, compared to $21.3 million, or 19.8% of net sales, in the previous year. This improvement in gross profit margin was attributed to better product margins, which increased to 56.6% of net sales from 52.6% in the prior year, primarily due to improved full-price selling and more current inventory. Selling, general, and administrative (SG&A) expenses were $44.2 million, or 35.4% of net sales, slightly up from $44.0 million, or 40.9% of net sales, in the same quarter last year.

Operationally, Tilly's reduced its store count to 220 locations, down from 238 a year earlier, while still managing to increase comparable store net sales by 22.9%. The average net sales per physical store rose to $430, up from $353, and the average net sales per square foot increased to $60 from $49. The company’s e-commerce sales represented 22.8% of total net sales, compared to 20.2% in the previous year, indicating a growing reliance on online sales channels.

Looking ahead, Tilly's management expressed concerns regarding the potential impact of inflation on consumer spending and overall market conditions. The company noted that persistent inflation could affect its ability to maintain the momentum gained in recent quarters. Additionally, Tilly's is focused on managing its operating costs, particularly in light of increased labor and product costs. The company is also committed to leveraging its existing cash reserves and marketable securities to finance operations and capital expenditures in the near term. As of May 2, 2026, Tilly's had working capital of $13.5 million, down from $25.1 million at the end of the previous fiscal year, reflecting changes in cash and inventory management.