Tilly’s (TLYS) Q3 2025 earnings summary

Executive summary

• Q3 net sales declined 13.8% year-over-year to $143.4 million, with comparable net sales down 3.4% and e-commerce up 4.9%, marking the best comp since 2021.

• Net loss for Q3 was $12.9 million ($0.43 per share), compared to $0.8 million ($0.03 per share) last year; year-to-date net loss was $32.6 million ($1.08 per share).

• Store count decreased to 246 from 249 year-over-year, with e-commerce representing 22.4% of Q3 net sales.

• Renewed marketing efforts and a new CMO are expected to address merchandising challenges and improve brand performance.

• Inflation, higher labor costs, and lower consumer spending continue to adversely impact results.

Financial highlights

• Gross margin for Q3 was 25.9%, down from 29.3% last year, with buying, distribution, and occupancy costs deleveraging by 320 basis points.

• SG&A expenses were $51.3 million (35.7% of net sales), flat in dollars but up as a percentage of sales.

• Operating loss for Q3 was $14.1 million (9.8% of net sales), compared to $2.5 million (1.5%) last year.

• Ended Q3 with $51.7 million in cash and marketable securities and no debt outstanding.

• Net inventories increased 11.8% year-over-year due to timing of inventory receipts for Black Friday.

Outlook and guidance

• Q4 net sales expected between $149 million and $156 million, with comparable net sales decline of 5%-9%.

• Product margin improvements of approximately 200 basis points anticipated for Q4.

• SG&A expected to be about $52 million, pre-tax and net loss projected between $13 million and $9.5 million, and loss per share between $0.43 and $0.32.

• At least 10 underperforming stores to close by year-end, reducing store count to 239 after opening 3 new stores.

• Fiscal 2025 capital expenditures projected at $10–$15 million for limited new stores and technology upgrades.