Figs downgraded to Market Perform at Telsey Advisory amid demand challenges

As previously reported, Telsey Advisory analyst Dana Telsey downgraded Figs to Market Perform from Outperform with a price target of $6, down from $11. Q4 results were impacted by the reclassification of revenue, resulting in the topline and gross margin miss, but the company still delivered a “sizable” adjusted EBITDA beat, the analyst tells investors. However, nearly two months into FY24, Figs acknowledged expectations for a challenging demand environment in the year ahead as macro headwinds persist and the initial revenue and adjusted EBITDA outlook disappointed, the analyst added.