Reformation Files for IPO at $1B Valuation After Crossing $500M in Revenue

Quick Facts

Reformation targets a $1 billion valuation, offering 14.1 million shares priced between $15 and $17, with the IPO expected to price July 29.
The Los Angeles-based womenswear brand reported $507.1 million in net revenue for fiscal year 2025, up 15.7% year over year.
Net income dropped to $12.6 million from $32.6 million the prior year, partly due to roughly $18 million in tariff-related costs.

Reformation is heading to the public markets. The Los Angeles-based womenswear brand filed to list on the New York Stock Exchange and is targeting a valuation of up to $1 billion, making it one of the few fashion companies to pursue a public offering in recent years.

The company and certain selling shareholders aim to raise up to $239.1 million by offering 14.1 million shares priced between $15 and $17 each. The IPO is expected to price on July 29, according to Bloomberg News. Reformation expects to net approximately $134.5 million, assuming a $16 per share price, and plans to use about $125 million of those proceeds to partially repay a loan.

The Financial Picture

Reformation posted $507.1 million in net revenue for the fiscal year ending December 27, 2025, up from $438.2 million the year prior. Sales in Q1 2026 reached $112.3 million, a 30.4% jump year over year, extending the company’s streak of double-digit quarterly growth to 20 consecutive periods.

Adjusted EBITDA came in at $45 million, or 8.9% of net revenue. Gross margin was 60.2%, down 360 basis points, driven by tariff exposure. The brand absorbed roughly $10 million in IEEPA tariffs directly, with another $8 million passed on from vendors. Net income fell to $12.6 million from $32.6 million the prior year.

Since 2015, Reformation’s sales have grown at a 34% compound annual growth rate.

The Business Model

Reformation describes itself as the world’s largest sustainable womenswear brand. It operates 70 stores across the U.S., UK, Canada, and France, and ships to more than 150 countries through its e-commerce platform. About 90% of revenue flows through direct-to-consumer channels.

Full-price sales have consistently made up approximately 80% of DTC net revenue from 2021 through 2025. The company produces new styles in small quantities, testing them twice weekly online and once weekly in stores, creating what its S-1 calls a scarcity model that drives repeat engagement.

Customers who shop both online and in stores purchase roughly five times per year on average and generate about 3.1 times higher annual spend than single-channel shoppers. Over 30% of new DTC shoppers were acquired through physical retail locations last year. Active customers totaled 1.14 million as of March 28, each generating an average of $421 in revenue.

Ownership and Underwriters

Private equity firm Permira, which took control of Reformation in 2019, plans to reduce its stake from 64.4% to 46.9% after the offering. Founder Yael Aflalo’s family trust will drop from 26% to 18.9%. Permira’s remaining stake means it will retain significant control over corporate decisions post-IPO.

J.P. Morgan, Morgan Stanley, Citigroup, and RBC Capital Markets are the primary underwriters. CEO Hali Borenstein, who took the helm from Aflalo in 2020, told Time the business is “on track to continue to achieve record annual revenue targets” despite tariff and supply chain pressures.

What Operators Should Watch

Reformation’s IPO is a test case for whether a sustainability-positioned DTC brand can command a premium valuation in public markets. Kat Liu, vice president at IPO research firm IPOX, noted that investors are not avoiding consumer companies outright, but said “few retail brands have enough recognition and differentiation to excite public-market investors.”

The offering comes as tariff headwinds compress margins across the apparel sector. How Reformation prices, trades, and communicates its unit economics in its first quarters as a public company will set a benchmark for other DTC brands watching from the sidelines.