Hot Topic Explained

Hot Topic, Inc.
Type:Private
Traded As:NASDAQ:
Industry:Retail
Key People:Steve Vranes, CEO (2016–present)
Betsy McLaughlin, CEO (2000–2011)
Bruce Quinell, Chairman of the Board
Products:clothing, accessories, music, jewelry
Revenue: US$741.8 million (FY 2013)[1]
Operating Income: US$30.8 million (FY 2013)[2]
Net Income: US$19.5 million (FY 2013)[3]
Assets: US$274.9 million (FY 2013)[4]
Equity: US$172.8 million (FY 2013)[5]
Owner:Sycamore Partners
Divisions:Blackheart Lingerie
BoxLunch
Homepage:www.hottopic.com
Foundation:
Montclair Plaza
Montclair, California, U.S.
Founder:Orv Madden
Location:City of Industry, California, U.S.
Locations:675 (April 2020)[6]

Hot Topic, Inc. (stylized as HOT TOPIC) is an American fast-fashion company specializing in counterculture-related clothing and accessories, as well as licensed music. The stores are aimed towards an audience interested in rock music and video gaming, and most of their audience ranges from teens to young adults. Approximately 40% of Hot Topic's revenue comes from sales of licensed band T-shirts. The majority of the stores are located in regional shopping malls.[7]

History

The first Hot Topic store was opened in November 1989 in Montclair Plaza, Montclair, California,[8] by Orv Madden, a former executive at The Children's Place, who retired as CEO in 2000 and was replaced by Betsy McLaughlin, who headed the company until 2011. Lisa Harper assumed the position of CEO in March 2011 until Steve Vranes was announced as the new CEO in 2016. The company went public and began trading on NASDAQ in 1996.

In 2013, Hot Topic announced its sale to private equity firm Sycamore Partners for $600 million.[9] The company ceased publishing financial data after 2013, as previously required as a public company.[10] [11]

Product assortment and sales

The store has gone through a number of phases in its history, reflective of various alternative culture and pop culture (including geek culture) trends (prime examples being Lolita, goth, or cosplay outfits). In the early 2000s, the store was known for heavily marketing nu-metal merchandise relating to bands. During that period, the store was also known for its sales of controversial gel bracelets (often rumored to be "sex bracelets") as well as the equally controversial styles of phat pants-inspired bondage pants popular among teenagers in the late 1990s and early-to-mid 2000s.[12]

The store later focused on skinny jeans and merchandise related to scene, emo and hardcore punk music and fashion, with a much larger focus on goths and spiky chokers and clothing. At present, the store's selection is largely focused on licensed video game merchandise and internet memes popular on sites such as Tumblr, as well as anime, manga, Japanese films, and the associated otaku subculture.

Ventures

Hot Topic launched Torrid, a concept store that sells clothing for plus-size women, in 2001.[13] While still under the same parent umbrella as Hot Topic, in 2015 the company branched off to become Torrid, LLC.

In 2008, Hot Topic launched ShockHound, an online retailer and social networking music site.[14] In March 2011, Hot Topic made a public statement announcing the shutdown of ShockHound. The site is no longer live, all merchandise was moved to HotTopic.com, and the company ceased sales of MP3s.[15]

In August 2010, Hot Topic first ventured the international market with opening two outlets in Ontario, Canada, initially at Square One Shopping Centre in Mississauga on August 11, and then at Scarborough Town Centre in Toronto the following day.[16] The company has since also opened additional Canadian locations as well as locations in Puerto Rico.

In 2012, Hot Topic launched Blackheart Lingerie, a concept store that sells lingerie and clothing for women.[17]

On May 26, 2015, Hot Topic announced its intent to acquire Geeknet Inc., owner of the online retailer ThinkGeek, for $122 million. However, the company received a $140 million counter-offer from GameStop, which Hot Topic did not choose to exceed.[18] [19] [20] [21]

On October 14, 2015, Hot Topic launched BoxLunch, a gift and novelty retail store.[22] For every $10 spent, a meal is donated to a person in need.[23]

Tour sponsorship

The company sponsored the 2004 Ozzfest concert tour,[24] the 2005 through 2007 Sounds of the Underground tour,[25] the 2008 Taste of Chaos tour,[26] and had a stage at and sponsored the 2008 and 2009 Rockstar Energy Drink Mayhem Festival tours. The company went on to sponsor Black Veil Brides 2014 Black Mass tour with special guests Falling in Reverse.[27]

Notes and References

  1. Web site: A50590453.HTM . 2023-08-16 . 2023-08-16 . https://web.archive.org/web/20230816235400/https://www.sec.gov/Archives/edgar/data/1017712/000115752313001515/a50590453.htm#item6 . live .
  2. Web site: A50590453.HTM . 2023-08-16 . 2023-08-16 . https://web.archive.org/web/20230816235400/https://www.sec.gov/Archives/edgar/data/1017712/000115752313001515/a50590453.htm#item6 . live .
  3. Web site: A50590453.HTM . 2023-08-16 . 2023-08-16 . https://web.archive.org/web/20230816235400/https://www.sec.gov/Archives/edgar/data/1017712/000115752313001515/a50590453.htm#item6 . live .
  4. Web site: A50590453.HTM . 2023-08-16 . 2023-08-16 . https://web.archive.org/web/20230816235400/https://www.sec.gov/Archives/edgar/data/1017712/000115752313001515/a50590453.htm#item6 . live .
  5. Web site: A50590453.HTM . 2023-08-16 . 2023-08-16 . https://web.archive.org/web/20230816235400/https://www.sec.gov/Archives/edgar/data/1017712/000115752313001515/a50590453.htm#item6 . live .
  6. Web site: Hot Topic Is Still Hot. Paula. Mejía. April 6, 2019. 2019-09-14. The New York Times. 2019-09-05. https://web.archive.org/web/20190905181858/https://www.nytimes.com/2019/04/06/style/hot-topic-stores.html. live.
  7. Web site: Hot Topic Annual Report 2007 . Hot Topic, Inc. . 2008-12-09 . 2008-04-28 . 2016-03-03 . https://web.archive.org/web/20160303170140/http://media.corporate-ir.net/media_files/irol/12/120007/2007_annual_report_2.pdf . live .
  8. Web site: NOVEMBER, 1989 // First store opens in Montclair, CA – and we move our headquarters into the store's of Hot Topic. history.hottopic.com. November 1989. 2017-08-12. 2017-08-12. https://web.archive.org/web/20170812172913/http://history.hottopic.com/november-1989-our-second-store-opens-in-montclair-ca-and-we-move-our-headquarters-into-the-stores-backroom/. live.
  9. Web site: Sycamore Partners to Buy Hot Topic for $600 Million. Michael J. de la. Merced. DealBook. 7 March 2013. 5 March 2017. 11 December 2017. https://web.archive.org/web/20171211161206/https://dealbook.nytimes.com/2013/03/07/sycamore-partners-to-buy-hot-topic-for-600-million/. live.
  10. Web site: March 22, 2013 . Form 10-K Filing Hot Topic Fiscal Year ending February 2013 . August 16, 2023 . SEC . August 16, 2023 . https://web.archive.org/web/20230816235400/https://www.sec.gov/Archives/edgar/data/1017712/000115752313001515/a50590453.htm#item6 . live .
  11. Web site: EDGAR Entity Landing Page . 2023-08-16 . www.sec.gov.
  12. Web site: 1995 // Tripp, Kikwear, and UFO pants are bigger than ever. - The History of Hot Topic. history.hottopic.com. January 1995. 2018-02-17. 2018-02-18. https://web.archive.org/web/20180218090414/http://history.hottopic.com/1995-tripp-pants-are-bigger-than-ever/. live.
  13. Web site: Lynn . Harris . Living large . . April 6, 2005 . February 26, 2014 . February 28, 2014 . https://web.archive.org/web/20140228000151/http://www.salon.com/2005/04/06/torrid/ . live .
  14. Web site: HOT TOPIC, INC. LAUNCHES SHOCKHOUND, NEW ALL-IN-ONE MUSIC SITE - UMG. 28 October 2008. 24 May 2016. 24 June 2016. https://web.archive.org/web/20160624170934/http://www.universalmusic.com/hot-topic-inc-launches-shockhound-new-all-in-one-music-site/. live.
  15. Web site: Hot Topic, Inc. Announces 2011 Changes Including ShockHound Closure. www.businesswire.com. 28 March 2011. 24 May 2016. 24 June 2016. https://web.archive.org/web/20160624155744/http://www.businesswire.com/news/home/20110328006652/en/Hot-Topic-Announces-2011-Including-ShockHound-Closure. live.
  16. Web site: Hot Topic to open shops in Canada . Financialpost.com . 2010-06-21 . 2014-02-26 . 2014-03-02 . https://web.archive.org/web/20140302120340/http://www.financialpost.com/news/Topic%20open%20shops%20Canada/3183279/story.html#ixzz0sqD8rB29 . live .
  17. Web site: Jessica . Misener . Hot Topic Launching 'Blackheart' Lingerie Line For The Romantic Mall-Goth In You . . 2012-11-01 . 2014-07-16 . 2014-07-25 . https://web.archive.org/web/20140725204711/http://www.huffingtonpost.com/2012/11/01/hot-topic-lingerie-blackheart-stores-underwear_n_2059095.html . live .
  18. News: Geeknet Gives Hot Topic Three Days to Match Higher Offer. 30 May 2015. Bloomberg. 2015-05-31. https://web.archive.org/web/20150531043946/http://www.bloomberg.com/news/articles/2015-05-29/geeknet-gives-hot-topic-three-days-to-match-higher-rival-offer. live.
  19. News: Hot Topic to Buy Retailer Geeknet Inc.. 26 May 2015. Wall Street Journal. 28 February 2021. https://web.archive.org/web/20210228082619/https://www.wsj.com/articles/hot-topic-to-buy-retailer-geeknet-inc-1432639751. live.
  20. News: Geeknet Calls New Takeover Offer Superior to Hot Topic's Bid . The Wall Street Journal . 29 May 2015 . 30 May 2015 . Beilfuss . Lisa . 28 February 2021 . https://web.archive.org/web/20210228081739/https://www.wsj.com/articles/geeknet-calls-new-takeover-offer-superior-to-hot-topics-bid-1432911893 . live .
  21. Web site: GameStop outbids Hot Topic for ThinkGeek parent company purchase. Ars Technica. 2 June 2015. 2 June 2015. 25 July 2017. https://web.archive.org/web/20170725192421/https://arstechnica.com/business/2015/06/gamestop-outbids-hot-topic-for-thinkgeek-parent-company-purchase/. live.
  22. News: New BoxLunch Stores To Carry Pop! Vinyls. Pop Vinyls. 2015-10-14. 2015-11-04. 2015-11-16. https://web.archive.org/web/20151116134610/http://popvinyls.com/2015/10/14/new-boxlunch-stores-to-carry-pop-vinyls/. live.
  23. Web site: BoxLunch. BoxLunch. 2015-11-04. 2015-11-01. https://web.archive.org/web/20151101100813/http://www.boxlunchgifts.com/. live.
  24. News: Rock Review: Ozzfest Trudges On, Laden With Sponsors and Politics . . 2004-07-16 . 2008-12-09 . Ratliff . B . 2018-12-15 . https://web.archive.org/web/20181215124336/https://www.nytimes.com/2004/07/16/movies/rock-review-ozzfest-trudges-on-laden-with-sponsors-and-politics.html . live .
  25. Web site: Official Website . 2019-09-28 . . dead . https://web.archive.org/web/20080715080220/http://www.soundsoftheundergroundtour.com/ . 2008-07-15 .
  26. Avenged Sevenfold, Atreyu Set For Taste Of Chaos . . 2007-12-20 . Peters . M . 2013-03-24 . 2014-10-16 . https://web.archive.org/web/20141016050633/http://www.billboard.com/articles/news/1046989/avenged-sevenfold-atreyu-set-for-taste-of-chaos . live .
  27. Web site: Rockstar69 ️. www.rockstar69.com . https://web.archive.org/web/20080212130849/http://www.rockstar69.com/event.php?evt=53 . February 12, 2008.

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