Guararapes , owner of Riachuelo and brands such as Carters and Fanlab, kicked off the earnings season for fashion retailers for the fourth quarter and the full year of 2025 on Wednesday, February 11th. And, in opening this showcase, some of the operation's numbers stood out.
The group reported a net profit of R$ 512.1 million in 2025, a year-on-year increase of 117.8%. Adjusted EBITDA, at R$ 1.75 billion, was a record and represented an annual jump of 18.1%. Meanwhile, the gross margin for apparel grew 2.4 percentage points to 56.7%, the highest level in the last seven years.
With these and other indicators, the company continued the pattern it has shown each quarter in its recent financial statements , consistently beating its own records. And this performance, in line with the rest of the market, has raised expectations regarding the future of this story.
“The bar is being raised, which brings ever greater challenges,” says André Farber , CEO of Guararapes, to NeoFeed . “But we believe that the initiatives that have brought us this far will continue to yield results, while we are already starting to look at other levers.”
As a result of a restructuring process that gained momentum from 2023 onwards, with the arrival of Farber, the advances in this roadmap included several fronts. Among them, greater integration between production, distribution and retail, seeking to extract more benefits and efficiencies from the group's vertically integrated model.
Following this trend of efficiencies, the next steps involve investments in areas such as the evolution of technologies applied in the group's distribution centers, as well as the expansion of the self-checkout installation project throughout the store network.
One of the new drivers expected to gain prominence is store expansion, primarily focused on the Riachuelo brand. The group accelerated this aspect in the last quarter of 2025 and ended the year with eight new store openings under that brand, compared to just one in 2024.
“We are planning between 15 and 20 openings per year in this next cycle, which, in five years, will add between 80 and 90 stores to our base,” says the CEO. “That’s a significant increase of 25% to 30% in distribution for Riachuelo, which currently has 340 units.”
Another new growth driver mentioned by the executive, this one more medium- to long-term, is a store model that Riachuelo began testing in December 2025, with the opening of a pop-up store in Pinheiros, in the west zone of São Paulo, which will remain open, initially, for twelve months.
Among other things, the pop-up store has a sales area of 250 square meters (m²) – compared to the average of 1,500 m² to 2,000 m² for the traditional format. Focused on collaborations and the Pool and D-Ultras brands, which produce technological fabrics, the product mix includes 1,500 SKUs, compared to a standard range of up to 60,000 in the online store.
“This is our statement on how we intend for the Riachuelo store and brand experience to evolve,” he says. “For now, we’ve only done this, but we know that a good store, with a good experience, always helps accelerate same-store sales.”
Riachuelo's priority collection also includes a diverse product mix. New additions to this year's offerings include the launch of Triya, a beachwear brand, and D-Sync, a fitness line featuring UV protection and technological fabrics.
“We have a lot in the works,” says the CEO. “The fashion market in Brazil moves more than R$ 200 billion and we only have 5% market share. If we double that, we will have a company that, in fashion, generates more than R$ 20 billion in revenue.”
In 2025, Guararapes reported consolidated net revenue of R$ 10.5 billion, a 9% increase. Within this figure, net merchandise revenue (retail) grew 8.9% to R$ 7.85 billion. During the year, same-store apparel sales advanced 10.3%.
At Midway, the financial arm, net revenue was R$ 2.51 billion, representing year-on-year growth of 9.5%. EBITDA for this operation, in turn, expanded by 19.3% to R$ 482.2 million.
On another note, the group closed the year with R$1.9 billion in cash, compared to R$1.06 billion in the third quarter. On the same basis of comparison, net debt decreased from R$839.2 million to R$560.2 million. And leverage decreased from 0.5 times to 0.3 times.
On the path to achieving the figures reported in its balance sheet and highlighting its focus on the retail and financial arms of Midway, one of the most recent initiatives was the sale of Midway Mall, the group's shopping center in Natal, to a group of investors led by Capitânia Capital, for R$ 1.6 billion.
Regarding possible new moves, Farber did not comment, however, on the recent report in the newspaper Valor Econômico , which stated that the company was preparing a follow-on offering. Among other points, one of the objectives would be to address the low liquidity of the stock, which is limiting its appreciation.
The group's position was limited to a relevant fact disclosed on February 6th. In it, the company emphasized that it continuously evaluates alternatives that could contribute to optimizing its capital structure, as well as meeting the minimum percentage of shares in circulation.
Among these options would be a potential follow-on offering. The company noted, however, that no definitive decision has been made regarding this offering, nor has it hired any financial advisor as part of this process.
Guararapes shares closed today's trading session at R$ 9.90, representing a slight increase of 0.92%. The company is valued at R$ 4.95 billion.
