Fashion retailer Aritzia swung to a net loss while revenue increased in the second quarter of FY24, which the company attributes to the level of new styles in its product assortment and a mixed consumer environment.

The company booked a net loss of $6 million while revenue rose 1.6 per cent to $534.2 million. Its net revenue in the US jumped 6 per cent to $278.9 million, while its sales in Canada fell 2.7 per cent to $255.3 million.

Revenue from brick-and-mortar stores climbed 3 per cent to $362 million, while e-commerce net revenue slid 1 per cent to $172.2 million.

“As we highlighted last quarter, we believe our top line trend is being impacted by missed opportunities in the level of new styles in our product assortment as well as a mixed consumer environment,” said Jennifer Wong, CEO at Aritzia.

“While our quarterly results do not meet our high standards, our performance was better than anticipated, and we made significant progress in executing against our FY24 priorities.”

Wong noted that Aritizia opened its Toronto area distribution center at the end of August and significantly improved the company’s inventory position.

Gross profit fell 15.2 per cent to $186.8 million while gross profit margin slid to 35 per cent.

Aritzia attributed the decline in gross profit margin to inflation in product costs, normalized markdowns, temporary warehousing costs related to inventory management, pre-opening lease amortization costs for boutiques and the new distribution centre, and foreign currency headwinds.

For the third quarter, the company forecasts revenue to be flat to slightly down as compared to the same quarter in the previous year.