Highlights in small-caps: the rise of Victoria's Secret, the collapse of Virgin Galactic, the GoPro default

Victoria's Secret sales are growing thanks to the "new era of sexy", and shares of Richard Branson's space company have fallen in price after the announcement of an additional offering. Meanwhile, action camera manufacturer GoPro is facing the threat of default - due to rising memory card prices. For biotech, late spring and early summer is an important season for conferences and investor meetings - we wrote about three promising stocks in the sector with different levels of risk. The main small-caps news for July 1-5 are in our review.

Revenue at lingerie maker Victoria's Secret rose 15%, to $1.56 billion, in the first quarter of fiscal 2026. Comparable sales increased 13%. Both figures were better than Wall Street forecasts. On the back of the strong results, the company improved its full-year revenue outlook to $7.03-7.13 billion versus a range of $6.85-6.95 billion previously.

After the report was published, Victoria's Secret shares rose 47.4% in trading on June 2.

The secret of success is a bet on returning to the brand's roots - sexuality. "We recorded double-digit sales growth in all key business lines," Victoria's Secret head Hillary Super, who took over in 2024 and is behind the company's transformation, revealed. As part of the "new era of sexy" that Super proclaimed, the company has revived the Victoria's Secret Fashion Shows. In addition, Victoria's Secret changed its stock ticker - to VSXY - in early June.

Virgin Galactic, the company of billionaire Richard Branson that plans to make money on space tourism, announced plans to issue new common stock to partially repay debts on bonds worth up to $30.5 million. So Virgin Galactic decided to capitalize on the tripling of its stock price in just a week, according to MarketWatch. The stock rose from Ma. 20 to June 1 along with the entire space industry amid news of SpaceX's IPO and the resumption of its own test flights.

But after the announcement of the additional issue, the securities fell almost 39% in trading on Tuesday, June 2: the issue of new shares dilutes the stakes of current shareholders. This is the strongest fall of securities in one day for all time of their circulation on the stock exchange, MarketWatch says.

Action camera maker GoPro has warned that skyrocketing prices for memory cards amid a boom in artificial intelligence have jeopardized the fulfillment of its debt obligations. Against this background, the company's shares collapsed by 12% in trading on June 1.

The company had to resubmit its annual report, because after its publication GoPro received a message from suppliers about the price increase of memory cards by 80-115%, and in April - about the planned reduction of production of cards used in cameras. As a result, the company lowered its sales forecast, expects further losses and is thinking about selling the company or merging.

Motley Fool freelance analyst Jennifer Sybil recommends shares of cosmetics brand e.l.f. Beauty. The company's stock is down nearly a third since the beginning of the year, and hasn't yet rallied - despite excellent financials in its most recently reported quarter.

Freedom Broker advised the securities of drone and drone defense systems manufacturer Airo Group as a speculative buy. According to analysts, the stock could rise by almost 50%: Airo Group expects to gain access to U.S. government contracts and benefit from the ban on purchases from foreign companies.

The season of biotech conferences and investor meetings is in full swing. For biotech companies, this is a period of important catalysts: research results can both double their capitalization and bring down their shares.

Igor Klyushnev, co-founder of Freedom Holding Corp. and founder of Freedom On Air, assessed the risks for investors at different stages of development of biotech companies and selected stocks with growth prospects in the coming weeks or months. For Definium, everything depends on clinical data; Viridian has completed clinical trials and is waiting for the FDA verdict. Kura' s drug has already been approved and brought to market, so the main issue is commercialization.