Torrid Holdings 2026 Q2 Earnings Misses Targets with Net Income Diving 81.2%

Torrid Holdings (CURV) reported its fiscal 2026 Q2 earnings on September 11, 2025. The results fell below expectations, with a sharp decline in net income and a revenue drop. The company also updated its guidance, maintaining a cautious outlook amid ongoing store closures and tariff pressures.

Revenue
Torrid Holdings posted Q2 revenue of $262.81 million, a 7.7% decline from $284.64 million in the same period the previous year. This drop reflects ongoing challenges in the retail sector and evolving consumer preferences.

Earnings/Net Income
The company’s earnings per share (EPS) dropped 75% year-over-year to $20.00 from $80.00, while net income plummeted 81.2% to $1.57 million from $8.33 million in 2025 Q2. These results indicate significant margin pressure and underscore the challenges of maintaining profitability in a shifting market.

Price Action
The stock of Torrid Holdings has experienced mixed price action: it gained 6.04% on the most recent trading day but lost 18.91% over the past week and is down 9.81% month-to-date, reflecting investor uncertainty.

Post Earnings Price Action Review
Lisa Harper, Chief Executive Officer, stated that the second quarter results aligned with expectations for both sales and Adjusted EBITDA. She highlighted the positive market response to the company’s strategic initiatives, including a focus on sub-brands and product innovation. To counter external challenges, such as new tariff rates expected to cost an additional $10 million, Harper emphasized disciplined sourcing and expense optimization. She also outlined key priorities, including enhancing product assortments with high-margin sub-brands, expanding digital and influencer marketing efforts, and optimizing the store fleet to improve efficiency and customer experience. The leadership tone was cautiously optimistic, balancing immediate operational hurdles with long-term goals of growth and profitability.

Guidance
Torrid Holdings updated its fiscal 2025 guidance, forecasting net sales between $1.015 billion and $1.030 billion, with third-quarter sales expected between $235 million and $245 million. Adjusted EBITDA is projected to range between $80 million and $90 million for the full year, with $16 million to $21 million anticipated in the third quarter. Capital expenditures are estimated at $10 million to $15 million, with plans to close up to 180 stores. The company expects a $50 million impact from tariffs, with $40 million anticipated to be mitigated through sourcing, expense reductions, and price optimization, leaving $10 million in expected exposure.

Additional News
On September 9, 2025, it was reported that Torrid Holdings had announced its Q2 results alongside updated guidance and plans to close up to 180 stores during fiscal 2025. This combination of declining sales, reduced earnings expectations, and significant store closures represents a major operational shift as the company adapts to evolving consumer demand and the retail landscape. For investors, the core investment thesis is a recovery in revenue growth and profitability as the company transitions to a leaner, more agile retail model. However, the aggressive pace of store closures introduces both urgency and uncertainty. The success of these closures in driving cost optimization will be a key short-term catalyst, but the rapid reduction in the store network also poses risks to near-term revenue and margins. If closures are concentrated in regions critical to the company’s core customer base, the impact could be more pronounced. Analysts project that Torrid Holdings will reach $995.9 million in revenue and $27.7 million in earnings by 2028, assuming a 3% annual revenue decline and a $17.6 million increase in earnings from the current $10.1 million. These forecasts underpin a fair value estimate of $3.85, representing a 133% upside to the current stock price. Fair value estimates from the community range from $1.90 to $3.85, offering a wide spectrum of perspectives on the stock’s intrinsic value.