FIGS (FIGS) Stock Forecast & Price Target

FIGS Inc has demonstrated a significant improvement in its operating margin, expected to expand by 930 basis points to 3.1%, contrasting sharply with last year's figure of (6.2%). The company reported a 5.8% year-over-year increase in total sales, reaching $152.6 million, which exceeded consensus expectations, reflecting strong demand and effective sales strategies. Furthermore, an increase in active customers by 4.1% year-over-year to 2.736 million indicates a growing customer base and potential for sustained revenue growth.

FIGS Inc faces a challenging financial outlook as management projects a significantly lower EBITDA margin for Q4 compared to Q3, driven by increased tariff pressure and enhanced marketing expenditures for the upcoming winter Olympics. Additionally, the company anticipates a modest decline in gross margin, with a forecasted 50 basis points decrease to 66.6%, slightly better than consensus expectations, and operating expenses in Q3 showed a more favorable reduction of 6.1% year-over-year. Furthermore, the US segment, which generates the majority of sales at 84%, experienced a slight decline, while orders per active customer decreased to 0.48, signaling potential customer engagement issues.