Roots reports strong Q1 2025 with sales up 6.7 percent

Canadian outdoor-lifestyle brand Roots reported a strong start to fiscal 2025, posting its third consecutive quarter of year-over-year growth across sales, gross margin, and adjusted EBITDA. For the first quarter ended May 3, 2025, total sales rose 6.7 percent to 40 million Canadian dollars, led by strong direct-to-consumer (DTC) performance.

DTC sales climbed 10.2 percent to 34.6 million Canadian dollars, supported by a 14.1 percent comparable sales increase, with growth achieved across both corporate retail stores and eCommerce. Gross profit improved 11.2 percent to 24.6 million Canadian dollars, with overall gross margin expanding by 250 basis points to 61.5.

“Our first-quarter results, marking the third consecutive quarter of year-over-year growth in sales, gross margin, and adjusted EBITDA, speaks to the growing resonance of the Roots brand and the discipline with which we are executing our strategic priorities,” said Meghan Roach, president and chief executive officer.

“From elevated marketing to improved product availability and AI-operational enhancements, we drove meaningful gains across key performance metrics. As we begin 2025, I am proud of how our team continues to innovate and deliver value, while navigating consumer preferences and the evolving retail landscape,” Roach added.

The company’s wholesale and partner-operated sales (P&O), however, declined to 5.4 million Canadian dollars due to inventory rationalisation by Roots’ international partner. Despite this, other P&O channels, including China’s Tmall eCommerce platform, delivered double-digit growth.

Net loss for the quarter narrowed to 7.9 million Canadian dollars, while on an adjusted basis, the net loss was 7.4 million Canadian dollars, an improvement of 16.5 percent. Adjusted EBITDA also showed progress, improving to a loss of 7.1 million Canadian dollars.