FIGS Releases Fourth Quarter and Full Year 2023 Financial Results
- Positive: Strong 7.9% YoY growth in net revenues for 2023.
- Positive: Improved net income of $22.6 million and adjusted EBITDA margin of 15.8%.
- Positive: Decrease in operating expenses by 12.5% YoY.
- Negative: CFO resignation may impact financial stability temporarily.
- Negative: Expected mid-single-digit to flat growth for 2024 indicates potential challenges.
- None.
Insights
The financial results reported by FIGS, Inc. highlight several key performance indicators that are essential for investors to consider. The company's net revenue growth of 7.9% year-over-year (YoY) is a positive sign, indicating an expanding customer base and successful sales strategies, despite the static growth in the fourth quarter. However, it is important to note that the gross margin has seen a slight contraction of 100 basis points YoY, which could suggest a shift towards lower-margin products or increased costs that have not been fully offset by price increases or cost savings measures.
Moreover, the reported increase in net income to $22.6 million and an improved net income margin to 4.1% reflect efficient cost management and operational effectiveness. The significant reduction in operating expenses as a percentage of net revenues from 66.0% to 57.7% YoY in the fourth quarter is particularly noteworthy, indicating that the company has successfully optimized its cost structure. The adjusted EBITDA margin of 15.8% for the full year, despite a slight decrease from the previous year, remains robust and demonstrates the company's ability to maintain profitability.
Investors should also consider the implications of the CFO's resignation. While the interim CFO has substantial experience, transitions in key financial leadership positions can introduce uncertainty. The company's forward guidance, anticipating a mid-single-digit decline to flat net revenue growth, suggests caution in the face of macroeconomic challenges. This conservative outlook may temper investor expectations for the near term while maintaining confidence in the company's long-term prospects.
FIGS, Inc.'s performance in the healthcare apparel market can be attributed to its direct-to-consumer approach and its focus on the healthcare community. With a 13.0% YoY increase in active customers, the company's marketing strategies and customer engagement efforts appear to be effective. However, the 5.0% decrease in net revenues per active customer could indicate a need for improved monetization strategies or could reflect broader market trends such as increased competition or pricing pressures.
The decrease in average order value (AOV) suggests that while customers are purchasing more frequently or in greater numbers, they might be spending less per transaction. This could be a result of a strategic shift towards more affordable products, an increase in promotional activities, or changes in customer buying behavior. Understanding these trends is crucial for developing strategies to increase AOV and overall revenue.
Additionally, the company's mention of macroeconomic factors affecting demand is a critical external consideration. Investors should monitor economic indicators and sector performance to gauge the potential impact on FIGS' business. The company's proactive measures to rebuild momentum and its strong balance sheet are positive signs for resilience and future growth.
From an economic perspective, FIGS, Inc.'s financial results must be contextualized within the broader economic environment. The company's anticipation of demand being impacted by macroeconomic factors reflects current economic uncertainties, potentially including inflationary pressures, shifts in healthcare spending and labor market dynamics within the healthcare sector. The healthcare workforce's reported stress could influence product demand, as financial constraints on healthcare professionals may lead to reduced spending on apparel.
The company's ability to generate $100 million in cash flow from operations is a strong indicator of its operational efficiency and liquidity, which provides a buffer against economic downturns. However, the projected decline in net revenues growth for the upcoming year suggests that FIGS is not immune to economic headwinds. Investors should consider the resilience of FIGS' business model in the context of potential healthcare budget tightening and consumer spending shifts.
It is also important to consider the company's strategic initiatives in response to these challenges. The focus on product innovation and brand strength, coupled with a robust balance sheet, may enable FIGS to navigate through economic uncertainties better than less financially stable competitors. The company's strategic initiatives will be critical in sustaining growth and maintaining market leadership in the healthcare apparel industry.
2023 Net Revenues Growth of
Fourth quarter and full year 2023 financial results reflect a
Fourth Quarter 2023 Financial Highlights
-
Net revenues were
$144.9 million $4.7 million -
Gross margin was
67.5% , a decrease of 70 basis points year over year. The Reclassification negatively impacted gross margin by 100 basis points. Gross margin benefited from lower air freight utilization, improved ocean freight costs and a more favorable promotional mix, partially offset by product mix. -
Operating expenses were
$83.6 million 12.5% year over year. As a percentage of net revenues, operating expenses decreased to57.7% from66.0% in the prior year due to a decrease in fulfillment costs associated with warehouse storage last year, lower brand marketing spend, and lower legal and insurance costs. -
Net income and net income, as adjusted(1) were
$10.0 million $0.05 $6.6 million $1.8 million -
Net income margin(2) was
6.9% , as compared to2.3% in the same period last year. -
Adjusted EBITDA(1) was
$26.6 million $6.8 million -
Adjusted EBITDA margin(1)(2) was
18.4% , as compared to13.6% in the same period last year.
“Looking back on 2023, we delivered strong growth and profitability, reduced inventory levels by
Full Year 2023 Financial Highlights
-
Net revenues were
$545.6 million 7.9% year over year, primarily driven by an increase in orders from existing and new customers and, to a lesser extent, an increase in AOV. -
Gross margin was
69.1% , a decrease of 100 basis points year over year, primarily due to product mix shift and, to a lesser extent, higher duties and a higher mix of promotional sales, partially offset by lower air freight utilization and ocean freight rates. -
Operating expenses were
$342.9 million 8.2% year over year. As a percentage of net revenues, operating expenses increased to62.8% from62.6% in the prior year period due to higher general and administrative expenses, partially offset by lower marketing and selling expenses. -
Net income was
$22.6 million $0.12 -
Net income margin(2) was
4.1% , as compared to4.2% in the same period last year. -
Net income, as adjusted(1) was
$23.3 million $0.13 -
Adjusted EBITDA(1) was
$86.0 million 15.8% of net revenues, as compared to$87.3 million 17.2% of net revenues in the same period last year. -
Free Cash Flow(1) was
$84.6 million
Full Year 2023 Key Operating Metrics
-
Active customers(3) as of December 31, 2023 increased
13.0% year over year to 2.6 million. -
Net revenues per active customer(3) was
$210 5.0% year over year. -
AOV(3) was
$115 2.7% year over year primarily driven by an increase in average unit retail and higher units per transaction.
Resignation of CFO and Appointment of Interim CFO
The Company’s Chief Financial Officer, Daniella Turenshine has informed the Company of her intention to step down as Chief Financial Officer to assume a role as a CFO at another company. Ms. Turenshine will remain in her role through April 12, 2024 and plans to serve as an advisor for as long as necessary thereafter to ensure a smooth transition.
The Company has commenced a search for a new Chief Financial Officer. Starting on April 12, 2024, Kevin Fosty, VP, Corporate Controller of the Company, will assume the role of Interim CFO.
Mr. Fosty has nearly 25 years of accounting and finance experience and has served as the Company’s VP, Corporate Controller since April 2021. Prior to FIGS, he spent nearly 10 years at The Siegfried Group, LLP, within the finance and corporate accounting group, providing controllership function leadership to private and public companies, including Alight, Inc., (formerly a Blackstone LLP portfolio company), Neogenomics, Inc., Stitch Fix, Inc. and Square, Inc. He previously served as corporate controller and chief financial officer for Evolution Resources, Inc. His background also includes corporate finance and M&A at leading global advisory and consulting firms, FTI Consulting, Inc. and Deloitte, LLP along with Big 4 audit at global audit firms KPMG, LLP and Arthur Andersen, LLP, where he began his career. He is also a Certified Public Accountant.
Ms. Spear commented, “Over her five-year tenure, Daniella has played an integral role in building FIGS into a more than half a billion dollar business and has proven to be an incredible thought partner and leader throughout her time with FIGS. She has also been instrumental in establishing the foundation to operate as a public company and has built a strong finance team. We appreciate all she has contributed to FIGS and we wish her the very best. Kevin has led the accounting team as corporate controller for three years and we are confident in his ability to serve as Interim CFO until a permanent CFO is named.”
Daniella Turenshine, Chief Financial Officer, commented, “Helping to build FIGS into the leading healthcare apparel brand that it is today has truly been an amazing experience. I’m so grateful to have worked with such smart, talented and incredible people. We have assembled a strong team and I have every confidence that Kevin and the entire finance organization will continue to execute during this transition period. FIGS is an incredible brand and I have great confidence in its long term success.”
2024 Financial Outlook
Net Revenues growth v. 2023 |
down mid single digits to flat |
|
|
Adjusted EBITDA Margin(4) |
|
Ms. Turenshine continued, “We believe we have identified areas of opportunity to reignite demand in our business but recognize this will take time and we are still facing macro headwinds. We remain confident in the long term prospects for our business. We are the distant leader in healthcare apparel with distinct competitive advantages in product innovation and brand love coupled with the scale and balance sheet to invest in future growth.”
(1) “Net income, as adjusted,” “adjusted EBITDA,” “adjusted EBITDA margin,” “diluted earnings per share, as adjusted” and “free cash flow” are non-GAAP financial measures. Please see the sections titled “Non-GAAP Financial Measures and Key Operating Metrics” and “Reconciliations of GAAP to Non-GAAP Measures” below for more information regarding the Company’s use of non-GAAP financial measures and reconciliations to the most directly comparable GAAP measures.
(2) “Net income margin” and “adjusted EBITDA margin” are calculated by dividing net income and adjusted EBITDA by net revenues, respectively.
(3) “Active customers,” “net revenues per active customer” and “average order value” are key operational and business metrics that are important to understanding the Company’s performance. Please see the sections titled “Non-GAAP Financial Measures and Key Operating Metrics” and “Key Operating Metrics” below for information regarding how the Company calculates its key operational and business metrics and for comparisons of active customers, net revenues per active customer and average order value to the prior year period.
(4) The Company has not provided a quantitative reconciliation of its adjusted EBITDA margin outlook to a GAAP net income margin outlook because it is unable, without making unreasonable efforts, to project certain reconciling items. These items include, but are not limited to, future stock-based compensation expense, income taxes, expenses related to non-ordinary course disputes, and transaction costs. These items are inherently variable and uncertain and depend on various factors, some of which are outside of the Company’s control or ability to predict. For more information regarding the Company’s use of non-GAAP financial measures, please see the section titled “Non-GAAP Financial Measures and Key Operating Metrics.”
Conference Call Details
FIGS management will host a conference call and webcast today at 2:00 p.m. PT / 5:00 p.m. ET to discuss the Company’s financial and business results and outlook. To participate, please dial 1-833-470-1428 (US) or 1-404-975-4839 (International) and the conference ID 136075. The call is also accessible via webcast at ir.wearfigs.com. A recording will be available shortly after the conclusion of the call until 11:59 p.m. ET on March 6, 2024. To access the replay, please dial 1-866-813-9403 (US) or 1-929-458-6194 (International) and the conference ID 424631. An archive of the webcast will be available on FIGS’ investor relations website at ir.wearfigs.com.
Non-GAAP Financial Measures and Key Operating Metrics
In addition to the GAAP financial measures set forth in this press release, the Company has included non-GAAP financial measures within the meaning of Regulation G and Item 10(e) of Regulation S-K. The Company uses “net income, as adjusted,” “diluted earnings per share, as adjusted,” “adjusted EBITDA” and “adjusted EBITDA margin” to provide useful supplemental measures that assist in evaluating its ability to generate earnings, provide consistency and comparability with its past financial performance and facilitate period-to-period comparisons of its core operating results as well as the results of its peer companies. The Company uses “free cash flow” as a useful supplemental measure of liquidity and as an additional basis for assessing its ability to generate cash. The Company calculates “net income, as adjusted,” as net income adjusted to exclude transaction costs, expenses related to non-ordinary course disputes, other than temporary impairment of held-to-maturity investments, stock-based compensation, including expense related to award modifications, accelerated performance awards and associated payroll taxes and costs, ambassador grants in connection with its initial public offering, and expense resulting from the retirement of the Company’s previous CFO, and the income tax impact of these adjustments. The Company calculates “diluted earnings per share, as adjusted” as net income, as adjusted divided by diluted shares outstanding. The Company calculates “adjusted EBITDA” as net income adjusted to exclude: other income (loss), net; gain/loss on disposal of assets; provision for income taxes; depreciation and amortization expense; stock-based compensation and related expense; transaction costs; and expenses related to non-ordinary course disputes. The Company calculates “adjusted EBITDA margin” by dividing adjusted EBITDA by net revenues. The Company calculates “free cash flow” as net cash (used in) provided by operating activities reduced by capital expenditures, including purchases of property and equipment and capitalized software development costs.
Reconciliations of non-GAAP financial measures to the most directly comparable GAAP measures are included below under the heading “Reconciliations of GAAP to Non-GAAP Measures.”
The Company has also included herein “active customers,” “net revenues per active customer” and “average order value,” which are key operational and business metrics that are important to understanding Company performance. The Company believes the number of active customers is an important indicator of growth as it reflects the reach of the Company’s digital platform, brand awareness and overall value proposition. The Company defines an active customer as a unique customer account that has made at least one purchase in the preceding 12-month period. In any particular period, the Company determines the number of active customers by counting the total number of customers who have made at least one purchase in the preceding 12-month period, measured from the last date of such period. The Company believes measuring net revenues per active customer is important to understanding engagement and retention of customers, and as such, the value proposition for its customer base. The Company defines net revenues per active customer as the sum of total net revenues in the preceding 12-month period divided by the current period active customers. The Company defines average order value as the sum of the total net revenues in a given period divided by the total orders placed in that period. Total orders are the summation of all completed individual purchase transactions in a given period. The Company believes its relatively high average order value demonstrates the premium nature of its products. As the Company expands into and increases its presence in additional product categories, price points and international markets, average order value may fluctuate.
Active customers as of December 31, 2023 and 2022, respectively, net revenues per active customer as of December 31, 2023 and 2022, respectively, and average order value for the years ended December 31, 2023 and 2022, respectively, are presented below under the heading “Key Operating Metrics.”
About FIGS
FIGS is a founder-led, direct-to-consumer healthcare apparel and lifestyle brand that seeks to celebrate, empower, and serve current and future generations of healthcare professionals. We create technically advanced apparel and products that feature an unmatched combination of comfort, durability, function, and style. We share stories about healthcare professionals’ experiences in ways that inspire them. We create meaningful connections within the healthcare community that we created. Above all, we seek to make an impact for our community, including by advocating for them and always having their backs.
We serve healthcare professionals in numerous countries in
Forward Looking Statements
This press release contains various forward-looking statements about the Company within the meaning of the Private Securities Litigation Reform Act of 1995, as amended, that are based on current management expectations, and which involve substantial risks and uncertainties that could cause actual results to differ materially from the results expressed in, or implied by, such forward-looking statements. All statements contained in this press release that do not relate to matters of historical fact should be considered forward-looking. These forward-looking statements generally are identified by the words “anticipate”, “believe”, “contemplate”, “continue”, “could”, “estimate”, “expect”, “forecast”, “future”, “intend”, “may”, “might”, “opportunity”, “outlook”, “plan”, “possible”, “potential”, “predict”, “project,” “should”, “strategy”, “strive”, “target”, “will” or “would”, the negative of these words or other similar terms or expressions. The absence of these words does not mean that a statement is not forward-looking. These forward-looking statements address various matters, including the Company’s expectation regarding the impact of macroeconomic factors on its future performance; the Company's plans to reignite demand, including actions to rebuild momentum and reignite its word of mouth flywheel; the Company's expectation relating to its strategic initiatives and the long term potential of FIGS; the Company’s plans for a permanent Chief Financial Officer and expectations regarding the transition period, including Ms. Turenshine's plans to serve as an advisor to ensure a smooth transition following her resignation; and the information under the section titled “2024 Financial Outlook,” such as the Company’s outlook as to net revenues growth and adjusted EBITDA margin for the full year ending December 31, 2024; all of which reflect the Company’s expectations based upon currently available information and data. Because such statements are based on expectations as to future financial and operating results and are not statements of fact, the Company’s actual results, performance or achievements may differ materially from those expressed or implied by the forward-looking statements, and you are cautioned not to place undue reliance on these forward-looking statements. The following important factors and uncertainties, among others, could cause actual results, performance or achievements to differ materially from those described in these forward-looking statements: the Company’s ability to maintain its historical growth; the Company’s ability to maintain profitability; the Company’s ability to maintain the value and reputation of its brand; the Company’s ability to attract new customers, retain existing customers, and to maintain or increase sales to those customers; the success of the Company’s marketing efforts; the Company’s ability to maintain a strong community of engaged customers and Ambassadors; negative publicity related to the Company’s marketing efforts or use of social media; the Company’s ability to successfully develop and introduce new, innovative and updated products; the competitiveness of the market for healthcare apparel; the Company’s ability to maintain its key employees; the Company’s ability to attract and retain highly skilled team members; risks associated with expansion into, and conducting business in, international markets; changes in, or disruptions to, the Company’s shipping arrangements; the successful operation of the Company’s distribution and warehouse management systems; the Company’s ability to accurately forecast customer demand, manage its inventory, and plan for future expenses; the impact of changes in consumer confidence, shopping behavior and consumer spending on demand for the Company’s products; the impact of macroeconomic trends on the Company’s operations; the Company’s reliance on a limited number of third-party suppliers; the fluctuating costs of raw materials; the Company’s failure to protect proprietary, confidential or sensitive or personal customer data or risks of cyberattacks; the Company’s failure to protect its intellectual property rights; the fact that the operations of many of the Company’s suppliers and vendors are subject to additional risks that are beyond its control; and other risks, uncertainties and factors discussed in the “Risk Factors” section of the Company’s Annual Report on Form 10-K for the year ended December 31, 2023 to be filed with the Securities and Exchange Commission (“SEC”), and the Company’s other periodic filings with the SEC. The forward-looking statements in this press release speak only as of the time made and the Company does not undertake to update or revise them to reflect future events or circumstances.
FIGS, INC. |
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BALANCE SHEETS |
||||||
(In thousands, except share and per share data) |
||||||
|
As of |
|||||
|
December 31, 2023 |
|
December 31, 2022 |
|||
Assets |
|
|
|
|||
Current assets |
|
|
|
|||
Cash and cash equivalents |
$ |
144,173 |
|
$ |
159,775 |
|
Short-term investments |
|
102,522 |
|
|
— |
|
Accounts receivable |
|
7,469 |
|
|
6,866 |
|
Inventory, net |
|
119,040 |
|
|
177,976 |
|
Prepaid expenses and other current assets |
|
12,455 |
|
|
11,883 |
|
Total current assets |
|
385,659 |
|
|
356,500 |
|
Non-current assets |
|
|
|
|||
Property and equipment, net |
|
24,864 |
|
|
11,024 |
|
Operating lease right-of-use assets |
|
43,059 |
|
|
15,312 |
|
Deferred tax assets |
|
18,291 |
|
|
10,971 |
|
Other assets |
|
1,336 |
|
|
1,257 |
|
Total non-current assets |
|
87,550 |
|
|
38,564 |
|
Total assets |
$ |
473,209 |
|
$ |
395,064 |
|
Liabilities and stockholders’ equity |
|
|
|
|||
Current liabilities |
|
|
|
|||
Accounts payable |
$ |
14,749 |
|
$ |
20,906 |
|
Operating lease liabilities |
|
8,230 |
|
|
3,408 |
|
Accrued expenses |
|
7,906 |
|
|
26,164 |
|
Accrued compensation and benefits |
|
7,312 |
|
|
3,415 |
|
Sales tax payable |
|
3,149 |
|
|
3,374 |
|
Gift card liability |
|
8,240 |
|
|
7,882 |
|
Deferred revenue |
|
2,160 |
|
|
2,786 |
|
Returns reserve |
|
2,989 |
|
|
3,458 |
|
Income tax payable |
|
2,557 |
|
|
— |
|
Total current liabilities |
|
57,292 |
|
|
71,393 |
|
Non-current liabilities |
|
|
|
|||
Operating lease liabilities, non-current |
|
38,884 |
|
|
15,756 |
|
Other non-current liabilities |
|
183 |
|
|
176 |
|
Total liabilities |
|
96,359 |
|
|
87,325 |
|
Commitments and contingencies |
|
|
|
|||
Stockholders’ equity |
|
|
|
|||
Class A common stock — par value |
|
16 |
|
|
16 |
|
Class B common stock — par value |
|
— |
|
|
— |
|
Preferred stock — par value |
|
— |
|
|
— |
|
Additional paid-in capital |
|
315,075 |
|
|
268,606 |
|
Accumulated other comprehensive income |
|
5 |
|
|
— |
|
Retained earnings |
|
61,754 |
|
|
39,117 |
|
Total stockholders’ equity |
|
376,850 |
|
|
307,739 |
|
Total liabilities and stockholders’ equity |
$ |
473,209 |
|
$ |
395,064 |
|
FIGS, INC. |
||||||||||||||||
STATEMENTS OF OPERATIONS |
||||||||||||||||
(In thousands, except share and per share data) |
||||||||||||||||
|
Three months ended December 31, |
|
Year ended December 31, |
|||||||||||||
|
2023 |
|
2022 |
|
2023 |
|
2022 |
|||||||||
|
(unaudited) |
|
|
|
|
|||||||||||
Net revenues |
$ |
144,918 |
|
|
$ |
144,898 |
|
|
$ |
545,646 |
|
|
$ |
505,835 |
|
|
Cost of goods sold |
|
47,058 |
|
|
|
46,050 |
|
|
|
168,683 |
|
|
|
151,375 |
|
|
Gross profit |
|
97,860 |
|
|
|
98,848 |
|
|
|
376,963 |
|
|
|
354,460 |
|
|
Operating expenses |
|
|
|
|
|
|
|
|||||||||
Selling |
|
28,057 |
|
|
|
37,649 |
|
|
|
125,149 |
|
|
|
118,449 |
|
|
Marketing |
|
20,129 |
|
|
|
21,428 |
|
|
|
77,094 |
|
|
|
77,692 |
|
|
General and administrative |
|
35,446 |
|
|
|
36,511 |
|
|
|
140,675 |
|
|
|
120,653 |
|
|
Total operating expenses |
|
83,632 |
|
|
|
95,588 |
|
|
|
342,918 |
|
|
|
316,794 |
|
|
Net income from operations |
|
14,228 |
|
|
|
3,260 |
|
|
|
34,045 |
|
|
|
37,666 |
|
|
Other income, net |
|
|
|
|
|
|
|
|||||||||
Interest income |
|
2,281 |
|
|
|
880 |
|
|
|
6,775 |
|
|
|
1,708 |
|
|
Other expense |
|
(2 |
) |
|
|
(502 |
) |
|
|
(13 |
) |
|
|
(647 |
) |
|
Total other income, net |
|
2,279 |
|
|
|
378 |
|
|
|
6,762 |
|
|
|
1,061 |
|
|
Net income before provision for income taxes |
|
16,507 |
|
|
|
3,638 |
|
|
|
40,807 |
|
|
|
38,727 |
|
|
Provision for income taxes |
|
6,507 |
|
|
|
247 |
|
|
|
18,170 |
|
|
|
17,541 |
|
|
Net income |
$ |
10,000 |
|
|
$ |
3,391 |
|
|
$ |
22,637 |
|
|
$ |
21,186 |
|
|
Earnings attributable to Class A and Class B common stockholders |
|
|
|
|
|
|
|
|||||||||
Basic earnings per share |
$ |
0.06 |
|
|
$ |
0.02 |
|
|
$ |
0.13 |
|
|
$ |
0.13 |
|
|
Diluted earnings per share |
$ |
0.05 |
|
|
$ |
0.02 |
|
|
$ |
0.12 |
|
|
$ |
0.11 |
|
|
Weighted-average shares outstanding—basic |
|
169,361,975 |
|
|
|
166,181,027 |
|
|
|
168,065,721 |
|
|
|
165,268,185 |
|
|
Weighted-average shares outstanding—diluted |
|
182,000,733 |
|
|
|
180,892,774 |
|
|
|
182,412,965 |
|
|
|
187,547,474 |
|
|
FIGS, INC. |
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STATEMENTS OF CASH FLOWS |
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(In thousands) |
||||||||
|
Year ended December 31, |
|||||||
|
2023 |
2022 |
||||||
Cash flows from operating activities: |
|
|
||||||
Net income |
$ |
22,637 |
|
$ |
21,186 |
|
||
Adjustments to reconcile net income to net cash (used in) provided by operating activities: |
|
|
||||||
Depreciation and amortization expense |
|
2,942 |
|
|
1,924 |
|
||
Deferred income taxes |
|
(7,320 |
) |
|
(732 |
) |
||
Non-cash operating lease cost |
|
2,863 |
|
|
2,381 |
|
||
Stock-based compensation |
|
45,799 |
|
|
37,458 |
|
||
Accretion of discount on available-for-sale securities |
|
(1,678 |
) |
|
— |
|
||
Changes in operating assets and liabilities: |
|
|
||||||
Accounts receivable |
|
(603 |
) |
|
(4,425 |
) |
||
Inventory |
|
58,936 |
|
|
(91,908 |
) |
||
Prepaid expenses and other current assets |
|
(572 |
) |
|
(4,483 |
) |
||
Other assets |
|
(79 |
) |
|
(197 |
) |
||
Accounts payable |
|
(6,192 |
) |
|
6,315 |
|
||
Accrued expenses |
|
(18,657 |
) |
|
1,487 |
|
||
Accrued compensation and benefits |
|
3,897 |
|
|
(3,049 |
) |
||
Sales tax payable |
|
(225 |
) |
|
(354 |
) |
||
Gift card liability |
|
358 |
|
|
2,292 |
|
||
Deferred revenue |
|
(626 |
) |
|
2,190 |
|
||
Returns reserve |
|
(469 |
) |
|
697 |
|
||
Income tax payable |
|
2,557 |
|
|
(3,973 |
) |
||
Operating lease liabilities |
|
(2,660 |
) |
|
(2,071 |
) |
||
Other non-current liabilities |
|
7 |
|
|
(67 |
) |
||
Net cash (used in) provided by operating activities |
|
100,915 |
|
|
(35,329 |
) |
||
Cash flows from investing activities: |
|
|
||||||
Purchases of property and equipment |
|
(16,348 |
) |
|
(5,348 |
) |
||
Purchases of available-for-sale securities |
|
(150,139 |
) |
|
— |
|
||
Maturities of available-for-sale securities |
|
49,300 |
|
|
— |
|
||
Purchases of held-to-maturity securities |
|
— |
|
|
(500 |
) |
||
Net cash used in investing activities |
|
(117,187 |
) |
|
(5,848 |
) |
||
Cash flows from financing activities: |
|
|
||||||
Proceeds from capital contributions |
|
— |
|
|
479 |
|
||
Proceeds from stock option exercises and employee stock purchases |
|
916 |
|
|
3,043 |
|
||
Tax payments related to net share settlements on restricted stock units |
|
(246 |
) |
|
— |
|
||
Net cash provided by financing activities |
|
670 |
|
|
3,522 |
|
||
Net decrease in cash, cash equivalents, and restricted cash |
|
(15,602 |
) |
|
(37,655 |
) |
||
Cash, cash equivalents, and restricted cash, beginning of period |
$ |
159,775 |
|
$ |
197,430 |
|
||
Cash and cash equivalents, end of period |
$ |
144,173 |
|
$ |
159,775 |
|
||
FIGS, INC.
RECONCILIATIONS OF GAAP TO NON-GAAP MEASURES
(Unaudited)
The following table presents a reconciliation of net income, as adjusted to net income, which is the most directly comparable financial measure calculated in accordance with GAAP, and presents diluted earnings per share (“EPS”), as adjusted with diluted EPS:
|
Three Months Ended December 31, |
|
Year Ended December 31, |
||||||||||||
|
2023 |
|
2022 |
|
2023 |
|
2022 |
||||||||
|
|
|
|
|
|
|
|
||||||||
|
(in thousands, except share and per share data) |
||||||||||||||
Net income |
$ |
10,000 |
|
$ |
3,391 |
|
|
$ |
22,637 |
|
|
$ |
21,186 |
|
|
Add (deduct): |
|
|
|
|
|
|
|
||||||||
Transaction costs |
|
— |
|
|
— |
|
|
|
— |
|
|
|
145 |
|
|
Expenses related to non-ordinary course disputes(1) |
|
— |
|
|
4,671 |
|
|
|
1,256 |
|
|
|
10,128 |
|
|
Stock-based compensation expense in connection with the IPO and other(2) |
|
— |
|
|
— |
|
|
|
290 |
|
|
|
— |
|
|
Other(3) |
|
— |
|
|
500 |
|
|
|
— |
|
|
|
500 |
|
|
Income tax impacts of items above |
|
— |
|
|
(350 |
) |
|
|
(847 |
) |
|
|
(2,808 |
) |
|
Net income, as adjusted |
$ |
10,000 |
|
$ |
8,212 |
|
|
$ |
23,336 |
|
|
$ |
29,151 |
|
|
Diluted EPS |
$ |
0.05 |
|
$ |
0.02 |
|
|
$ |
0.12 |
|
|
$ |
0.11 |
|
|
Diluted EPS, as adjusted |
$ |
0.05 |
|
$ |
0.05 |
|
|
$ |
0.13 |
|
|
$ |
0.16 |
|
|
Weighted-average shares used to compute Diluted EPS, as adjusted |
|
182,000,733 |
|
|
180,892,774 |
|
|
|
182,412,965 |
|
|
|
187,547,474 |
|
|
(1) Exclusively represents attorney's fees, costs and expenses incurred by the Company in connection with the Company's now-concluded litigation against Strategic Partners, Inc.
(2) Includes certain stock-based compensation expense in connection with the IPO, including expense related to accelerated performance awards and associated payroll taxes and costs.
(3) Includes other than temporary impairment of held-to-maturity investments.
The following table presents a reconciliation of adjusted EBITDA to net income, which is the most directly comparable financial measure calculated in accordance with GAAP, and presents adjusted EBITDA margin with net income margin, which is the most directly comparable financial measure calculated in accordance with GAAP:
|
Three Months Ended December 31, |
|
Year Ended December 31, |
|||||||||||||
|
2023 |
|
2022 |
|
2023 |
|
2022 |
|||||||||
|
(in thousands, except margin) |
|||||||||||||||
Net income |
$ |
10,000 |
|
|
$ |
3,391 |
|
|
$ |
22,637 |
|
|
$ |
21,186 |
|
|
Add (deduct): |
|
|
|
|
|
|
|
|||||||||
Other income, net |
|
(2,279 |
) |
|
|
(378 |
) |
|
|
(6,762 |
) |
|
|
(1,061 |
) |
|
Provision for income taxes |
|
6,506 |
|
|
|
246 |
|
|
|
18,170 |
|
|
|
17,541 |
|
|
Depreciation and amortization expense(1) |
|
814 |
|
|
|
638 |
|
|
|
2,942 |
|
|
|
1,924 |
|
|
Stock-based compensation and related expense(2) |
|
11,562 |
|
|
|
11,197 |
|
|
|
47,757 |
|
|
|
37,533 |
|
|
Expenses related to non-ordinary course disputes(3) |
|
— |
|
|
|
4,671 |
|
|
|
1,256 |
|
|
|
10,128 |
|
|
Adjusted EBITDA |
$ |
26,603 |
|
|
$ |
19,765 |
|
|
$ |
86,000 |
|
|
$ |
87,251 |
|
|
|
|
|
|
|
|
|
|
|||||||||
Net Revenues |
$ |
144,918 |
|
|
$ |
144,898 |
|
|
$ |
545,646 |
|
|
$ |
505,835 |
|
|
Net income margin(4) |
|
6.9 |
% |
|
|
2.3 |
% |
|
|
4.1 |
% |
|
|
4.2 |
% |
|
Adjusted EBITDA Margin |
|
18.4 |
% |
|
|
13.6 |
% |
|
|
15.8 |
% |
|
|
17.2 |
% |
|
(1) Excludes amortization of debt issuance costs included in “Other income, net.”
(2) Includes stock-based compensation expense, payroll taxes, and costs related to equity award activity.
(3) Exclusively represents attorney's fees, costs and expenses incurred by the Company in connection with the Company's now-concluded litigation against Strategic Partners, Inc.
(4) Net income margin represents net income as a percentage of net revenues.
The following table presents a reconciliation of free cash flow to net cash (used in) provided by operating activities, which is the most directly comparable financial measure calculated in accordance with GAAP:
|
Year ended December 31, |
|||||||
|
2023 |
|
2022 |
|||||
|
(in thousands) |
|||||||
Net cash (used in) provided by operating activities |
$ |
100,915 |
|
|
$ |
(35,329 |
) |
|
Less: capital expenditures |
|
(16,348 |
) |
|
|
(5,348 |
) |
|
Free cash flow |
$ |
84,567 |
|
|
$ |
(40,677 |
) |
|
FIGS, INC.
KEY OPERATING METRICS
(Unaudited)
Active customers as of December 31, 2023 and 2022, respectively, net revenues per active customer as of December 31, 2023 and 2022, respectively, and average order value for the year ended December 31, 2023 and 2022, respectively, are presented in the following tables:
|
As of December 31, |
|||||
|
2023 |
2022 |
||||
|
(in thousands) |
|||||
Active customers |
|
2,593 |
|
2,294 |
||
|
As of December 31, |
|||||
|
2023 |
2022 |
||||
Net revenues per active customer |
$ |
210 |
$ |
221 |
||
|
Year ended December 31, |
|||||
|
2023 |
2022 |
||||
Average order value |
$ |
115 |
$ |
112 |
||
View source version on businesswire.com: https://www.businesswire.com/news/home/20240228179038/en/
Investors:
Jean
IR@wearfigs.com
Media:
Todd Maron
press@wearfigs.com
Source: FIGS, Inc.
FAQ
What was FIGS, Inc.'s net income for 2023?
What was the adjusted EBITDA margin for FIGS, Inc. in 2023?
Who resigned from the position of Chief Financial Officer in FIGS, Inc.?
Who will serve as the Interim CFO in FIGS, Inc. starting April 12, 2024?
What is FIGS, Inc.'s expected net revenue growth for 2024?
