TILLY'S, INC. (TLYS)·Q4 2025 Earnings Summary

Executive Summary

• Q4 FY2024 (ended Feb 1, 2025) was weak: net sales $147.3M (-14.9% YoY; comps -11.2% on a comparable 13-week basis) and diluted EPS of -$0.45; product margins improved by 190 bps but were outweighed by deleverage and inventory valuation reserves .
• Management made merchandising leadership changes and is targeting a reset by mid-year; early Q1 (fiscal February) comps were -5.7% with positive store comps for four days during a warm spell, underpinning cautious optimism for Spring assortments .
• Q1 FY2025 guidance implies continued losses: net sales $105–$111M, comps -8% to -3%, SG&A $42–$43M, EPS -$0.68 to -$0.58, near-zero tax rate; expects 238 stores and $25–$30M cash/marketable securities at quarter-end, no ABL usage .
• Street estimates: S&P Global consensus data were unavailable at the time of this analysis due to an API rate limit; thus beat/miss vs consensus cannot be assessed. If consensus previously anticipated better Q1 sales/losses, models likely need to come down (see Guidance) [GetEstimates error: Daily Request Limit Exceeded].

What Went Well and What Went Wrong

• What Went Well

  • Product margins expanded by 190 bps YoY in Q4, driven by improved initial markups despite higher inventory reserves .
  • Expense control plans are underway for FY2025: targeted payroll discipline despite minimum wage increases, renegotiated contracts, and lease decision rigor; management expects SG&A dollars to be down YoY if sales turn up .
  • Cash/liquidity preserved: $46.7M cash and marketable securities and $48.0M undrawn ABL at FY-end; company believes it can operate without drawing ABL in FY2025 at current comp trend .

• What Went Wrong

  • Top-line deterioration: total comps -11.2% for Q4; e-com net sales -17.8% (-14.8% comps) and store comps -9.8%; November was notably weak (-21% comps), with December/January -6% to -7% .
  • Deleverage: buying, distribution and occupancy costs deleveraged 290 bps despite being $1.5M lower YoY due to lower sales; SG&A mix remained elevated at 35.6% of sales .
  • Continued losses: operating margin -9.6% (vs -4.9% LY); net loss -$13.7M (vs -$20.6M LY, which included a tax valuation allowance impact); FY net loss widened to -$46.2M .

Financial Results

Channel/Segment (Q4 FY2024)

• Stores net sales: $108.3M (73.5% of sales); store comps -9.8% (13-week comparable) .
• E-commerce net sales: $39.0M (26.5% of sales); e-com comps -14.8% (13-week comparable) .

Q3 FY2024 Channel Reference

• Stores: $111.3M (77.6% of sales); store comps -5.6% .
• E-commerce: $32.2M (22.4% of sales); e-com comps +4.9% .

KPIs and Balance Sheet

• Store count: 240 at Q4-end (net -8 YoY; closed 10 in Q4) .
• Inventory: +9.5% YoY at FY-end; as of Mar 1, 2025 inventories were -6.1% YoY after actions taken .
• Cash & Mkt. Securities: $46.7M; Available ABL: $48.0M (undrawn) .
• Capex FY2024: $8.2M (vs $14.0M FY2023) .

Estimates vs. Actuals

• S&P Global consensus estimates were unavailable at time of analysis due to an API rate limit; comparison to Street is not provided [GetEstimates error: Daily Request Limit Exceeded].

Guidance Changes

Notes/Drivers: Later Easter timing (April 20 vs March 31 LY) expected to pressure March before improving; warmer-weather boost seen briefly in late February .

Earnings Call Themes & Trends

Management Commentary

• “The fourth quarter of fiscal 2024 was disappointing… We made several organizational changes in our merchandising team… We believe our spring assortment is on trend… We have planned meaningfully reduced inventory commitments throughout fiscal 2025… targeted significant expense reductions… while continuing to invest in marketing and select new stores.” — CFO Michael Henry, prepared remarks .
• “By July, we should see the results of the merchant team effort… we had to mark down a lot of the merchandise because it was just the wrong direction… we expect to clear all that… and see some results in July.” — CEO Hezy Shaked .
• “As our cash naturally ebbs and flows… we expect to end the first quarter with total cash and marketable securities of approximately $25 million to $30 million… and we believe we can operate without accessing our credit facility at any time during fiscal 2025.” — CFO Michael Henry .

Q&A Highlights

• Cadence: Comps by month were highly uneven — November -21% (weakest), December/January -6%/-7%; February comps -5.7% overall with positive store comps for four days during a heat wave, shaping the Q1 outlook range .
• Merchandising timeline: Leadership changes made; inventory clearance of misplaced product is ongoing; management expects customers to see the new assortment impact by July .
• Inventory and liquidity: Plan to run lower unit inventories all year; at ~-10% comp or better, no ABL draw anticipated; at current run-rate (-5.7% in February), company expects to remain borrowing-free .
• Store strategy: Hybrid e-com fulfillment model (DC plus ship-from-store where appropriate); two opportunistic openings and seven closures planned in 1H; ~80 lease decisions typical each year .
• Expense control: Despite minimum wage increases (~$0.4M headwind in Q1), payroll dollars expected down via tighter metrics; broad contract renegotiations support SG&A control .

Estimates Context

• S&P Global consensus for Q4 FY2024 and Q1 FY2025 was unavailable at the time of analysis due to an API rate limit; therefore we cannot provide a beat/miss assessment vs Street for Q4 and cannot benchmark Q1 guidance vs consensus [GetEstimates error: Daily Request Limit Exceeded].
• Implications: Management’s Q1 guide (sales $105–$111M; EPS -$0.68 to -$0.58) is loss-making with negative comps and high fixed-cost deleverage; if the Street previously modeled stronger demand/less negative EPS, we expect estimate revisions down to incorporate the guidance .

Key Takeaways for Investors

• Quarter reset underway: Despite Q4 sales pressure and deleverage, product margin progress and a full merchandising reset by mid-year (July) are the central near-term catalysts; watch Spring sell-through and early BTS signals for confirmation .
• Guidance conservative with timing headwinds: Later Easter and mixed early-quarter trends anchor Q1 guide to negative comps and losses; upside hinges on sustained warmer weather traction in Spring assortments .
• Inventory and cash discipline: Management plans lower unit inventories throughout FY2025; at current comp trends, no ABL usage is expected, preserving financial flexibility during the turnaround .
• Cost actions are real: Contract renegotiations, payroll tightening across stores/DC/corporate, and lease decision rigor should bend SG&A lower in FY2025 if sales stabilize, improving flow-through .
• Store portfolio optimization: Expect incremental closures of underperformers and selective openings with short ROI hurdles; ~80 annual lease decisions create levers for rent relief and footprint mix .
• Risk monitor: E-com softness (Q4 e-com -17.8% YoY) and broader macro/traffic pressures remain key risks; inventory valuation reserves and fixed-cost deleverage can offset product margin gains in weak sales environments .
• Setup for 2H: If merchandising reset lands by July and inventory turns improve, 2H could show better comps and margin recapture; track monthly cadence, clearance progress, and SG&A trajectory for confirmation .

Citations:

• Q4 FY2024 8-K press release and financial statements:
• Q4 FY2024 earnings call transcript:
• Q3 FY2024 8-K:
• Q2 FY2024 8-K:
• Additional press release duplicates: –
• Estimates note: S&P Global consensus unavailable due to API limit [GetEstimates error: Daily Request Limit Exceeded].