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Torrid Q2 sales fall 18%, lowers FY outlook

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Plus-size women swear brand Torrid has reported a 18.2 percent drop in net sales in the second quarter as the company navigates a “rebuild year” in a “challenging market.”

The US brand, which specialises in fashion for sizes 10 to 30, generated sales of 289.1 million dollars in the three months to July 29, compared to 353.5 million dollars in the prior-year period.

Its net profit narrowed to 6.6 million dollars from 22.7 million dollars a year earlier.

Gross profit margin shrunk to 35.5 percent from 37.2 percent, which it said was primarily driven by a decrease in private label credit card funds, deleverage of store occupancy costs as a result of lower net sales, and increases in store depreciation expense and merchandising payroll costs.

On a brighter note, those factors were partially offset by improved pricing strategies.

“Our second quarter results were in line with our guidance, reflecting our commitment to disciplined expense and inventory management even amidst a challenging market,” said CEO Lisa Harper in a statement.

For the full year, the company now expects net sales of between 1.08 billion dollars and 1.115 billion dollars, down from its previous guidance of between 1.095 billion dollars and 1.145 billion dollars.

It now expects an adjusted EBITDA of between 90 million dollars and 100 million dollars, compared to previous guidance of between 115 million dollars and 130 million dollars.

Harper continued: “We maintain that fiscal 2023 is a pivotal ‘rebuild year’ for us.

“Our laser focus is on balancing our merchandise assortment through exceptional value and product offerings, while expanding our customer base through a robust omnichannel strategy. We are confident that this will set the stage for sustainable long-term growth.”

 

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Fashion

Pinterest announces trend predictions for 2024

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As the latest trends seem to move a million miles per minute, Pinterest stays ahead of the curve—the lifestyle tech company just revealed its predictions for 2024 trends across beauty, fashion, and more.

Based on an analysis of various search algorithms generated by visitors on the platform, Pinterest’s near-500 million users provide insights on what is currently garnering mass interest, and what will soon be on the radar across multi-generational consumers prior to its rise.

And the platform has seldom been wrong. Among the highlighted trends forecasted for 2023 was the rise of ultra-femininity in fashion, which has since manifested itself in the whimsical bows, lacy motifs, and airy styles seen across the runways at fashion week and social media trends.

This coming year, the feminine frenzy will continue on with “Bow Stacking.” Thanks to a 190 percent and 180 percent uptick in searches like “Bow outfit” and “Bow necklace,” 2024 will continue the love for the frilly detail—à la popular brands like Sandy Liang—but in unbridled maximalist fashion, adorning the accessory onto hair, shoes, bags, and overall looks.

On the side of masculine fashion, Pinterest noted the emergence of “Eclectic Grandpa” in 2024 chiefly among Gen Z and boomers, who will “embrace grandpacore and bring eccentric and expressive elements for the ages to their wardrobes,” per the report. Encompassing retro staples and layered cardigans in ‘70s-esque hues, this nostalgic style was increasingly explored by 130 percent.

An appreciation for all things vintage also makes its way into upcycling trends, showing a desire in consumers to get crafty and explore not just secondhand clothing, but second hand materials for themselves. Similar to the DIY fad of the 2010s, “Give a Scrap” looks to be the upcoming fashion project for boomers and Gen Xers alike. With searches like “zero waste sewing patterns” and “leftover fabric” both up 80 percent, consumers are gravitating toward habits that drive sustainability in their personal approach to fashion.

Between metal-toned jewellery and avant-garde fashion, metallic colours and creations are slated to be a highly sought-after material in 2024. “Metallics will make their way into the mainstream in 2024 as Gen Z and Millennials trade in their neutrals for something a bit more hardcore,” wrote Pinterest in the report. Popular pursuits like “metal corset” and “silver necklaces layered” indicate growing interest in metal hardware, but the textured shades are also being explored in aluminium furniture and metallic nail art.

The “Make it Big” trend also further bolsters the growth of metals, as shoppers are looking toward bolder, chunkier silhouettes in accessories and hairstyles alike, suggested by the prevalence of inquiries like “chunky hoops” and “sculptural jewellery.”

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AI-driven shopping app Yaysay secures $10.3m in funding

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Yaysay, a shopping app utilising artificial intelligence (AI) to provide a personalised gamified experience, has secured 10.3 million dollars in funding in order to launch its Beta mode into the market.

The app, co-founded by industry veterans from Casper, Gilt Groupe and Stitch Fix, aims to make off-price shopping a “five-minute daily habit”, offering a “sustainable solution for excess inventory in the retail industry”.

Using AI, the platform provides users with a personalised fashion feed that draws inspiration from social media and other apps while blending the concept of competition and gaming into one shopping experience.

Each day, the feed will refresh its offering of discounts on sought-after brands, such as Chloé, Acne Studios, Gannie and Loewe, in a design aiming to act as a new treasure hunt while also “breathing new life into overstock inventory”.

In a release, Yaysay CEO, Lindsay Ferstandig, the former CEO of Stitch Fix, said: “While mobile shopping is convenient, it is generally uninspiring for brands and consumers alike. With Yaysay, we are creating an elevated brand experience that brings the joy back to shopping, transforming deals from the most covetable brands into addictive bites of fun.”

The Beta version of Yaysay is now live and comes alongside a waitlist which will allow consumers to gain an early glimpse into the platform within the coming weeks.

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Pepco issues ‘downward revision’ to forecast reorganises management

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European retail chain Pepco is continuing to experience a downward trend in its financials, as revenues for August came in lower than anticipated and are worsening in September, with negative like-for-like sales and weaker than expected performance from new stores.

The group, which operates UK-based Poundland, has been attempting to initiate an expansion strategy in the region, with plans to open a slew of refreshed stores and grow its fashion business, among other categories.

However, it appears that such efforts have not been enough to avoid the slower rate of sales in its core markets of Central and Eastern Europe (CEE), with gross margins also not bringing in the recovery expected and record warm weather dampening the demand for its autumn/winter collections.

As a result, Pepco said it made a “further downward revision” to its full year 2023 forecast, while also now forecasting to deliver underlying EBITDA of around 750 million euros.

The group has also taken “immediate and decisive” actions to shuffle its management team in light of the underperformance and the recent departure of its outgoing CEO.

Strategic review adopted to address costs Anand Patel, the managing director of the Pepco business, will step down immediately and will be replaced by managing director of Poundland, Barry Williams. Meanwhile, chief operating officer of Poundland, Austin Cooke, will step into the role of managing director for the retailer.

A group executive committee has also been formed in order to establish a strategy review across the group to address costs and initiatives that could generate “appropriate returns in the near term” and accelerate transformation.

In a release, executive chairman Andy Bondy said: “We remain confident in the opportunity of building Europe’s leading variety discount retailer offering great value to consumers across a range of FMCG, clothing and general merchandise products.

“However, it is clear that we need to refocus on delivering for our customers in our core business while delivering more measured growth. We need to improve profitability and cash generation in our established business alongside a more targeted growth plan in markets where we have an existing presence.”

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