Dive Brief:
- Direct-to-consumer healthcare apparel brand Figs opened its first permanent retail space on Friday, according to a company press release.
- The store — dubbed a “Community Hub” — is located at the Century City Mall in Los Angeles, which also houses five healthcare clinics as tenants and is within 10 miles of six major healthcare institutions, per the release. Figs plans to open its next store in the first half of 2024 in Philadelphia’s Rittenhouse Square.
- Figs’ third quarter net revenue increased 10.7% year over year to $142.4 million, according to a Thursday press release. Net income increased nearly 52% to $6.1 million and the brand raised its full-year outlook, now expecting net revenue growth of about 8.5% instead of the previously predicted range of 5.5% to 7.5%.
Dive Insight:
Figs is expanding into DTC brick-and-mortar with the goal of capitalizing on geographical locations with a high density of healthcare professionals.
“We could not be more excited to open our first Community Hub, and to do it in Los Angeles, where Figs was founded,” Figs’ CEO and co-founder Trina Spear said in a statement.
The brand’s Community Hubs will also host events to celebrate healthcare professionals, provide relevant programming and more. The move into physical retail comes after demand from Figs’ pop-ups and community activations.
Figs’ gross margin in the third quarter decreased 220 basis points year over year to 68.4% mostly due to mix shift as well as a higher mix of promotional sales and additional factors. Operating expenses increased 9.8% to $87.4 million and the number of active customers as of Sept. 30 increased 19.6% to 2.6 million.
“Our third quarter performance reflects strong execution of our strategic priorities,” Figs CFO Daniella Turenshine said in a statement. “We have an incredibly healthy balance sheet with ample cash and no debt and our business model generates strong cash flow. We are in the early stages of growth and intend to make the investments that we believe will drive accelerated growth as we move past near term macro challenges.”
The apparel and lifestyle brand appointed former Chief Financial Officer of Chewy Mario Marte to its board of directors. Marte will act as an independent director and has been placed on the board’s audit committee. Figs announced the appointment of former Chewy and GameStop executive Mark Bixby as its new chief technology officer in September.
