Bath & Body Works, Inc. (BBWI Quick QuoteBBWI - Free Report) is expected to report a year-over-year increase in the top line when it releases first-quarter fiscal 2025 earnings on May 29, before the market opens. Investors are closely monitoring for insights into the company's performance and strategic direction.

BBWI has effectively established a leading global retailer specializing in personal care and home fragrance products. The Zacks Consensus Estimate for fiscal first-quarter revenues is pegged at $1.42 billion, which indicates an increase of 2.8% from the prior-year reported figure.

Also, the bottom line is expected to have improved year over year. Although the Zacks Consensus Estimate for earnings per share has declined by 1 cent to 41 cents over the past 30 days, this still represents a 7.9% improvement from the adjusted earnings of 38 cents in the year-ago quarter.

Bath & Body Works delivered a trailing four-quarter earnings surprise of 7.5%, on average. In the last reported quarter, this Columbus, OH-based company surpassed the Zacks Consensus Estimate by a margin of 2.5%. (Find the latest EPS estimates and surprises on Zacks Earnings Calendar.)

Factors Shaping Bath & Body Works’ Q1 Outcome

Bath & Body Works' strategic focus on product innovation, international growth and disciplined cost management is likely to have positively impacted its fiscal first-quarter performance. The company’s revenues are expected to have been influenced by targeted product innovations and enhanced customer engagement. The expansion of its Everyday Luxuries line, which now includes body creams and body washes, is anticipated to have attracted a younger, more diverse customer base, driving higher sales volumes.

Additionally, strategic collaborations, such as the Disney Princess collection launched earlier this year, generated significant consumer excitement, likely contributing meaningfully to first-quarter revenues. These partnerships have proven successful in boosting visibility and attracting both loyal and new customers to stores and online platforms. The company’s loyalty program is another crucial factor in revenue growth. Bath & Body Works' focus on digital integration, particularly through the Buy Online, Pickup In Store option, has effectively captured consumer convenience preferences, further likely to have impacted the first-quarter top line.

On the last earnings call, Bath & Body Works guided net sales growth of 1% to 3% for the first quarter. International expansion is also set to have contributed positively as BBWI had earlier projected high single-digit growth in system-wide retail international sales. The Zacks Consensus Estimate suggests a 12.9% increase in International revenues.

On the earnings front, disciplined cost management is expected to have supported the bottom line. Bath & Body Works did guide a 50 basis point contraction in gross margin of approximately 43.3% due to a higher international sales mix, which has lower margins. Nonetheless, ongoing cost optimization through the Fuel for Growth program is likely to have maintained cushioned margins. The company’s fiscal first-quarter earnings per share are expected to range between 36 cents and 43 cents.

What the Zacks Model Predicts for BBWI Stock

Our proven model predicts an earnings beat for BBWI this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat, which is the case here. You can uncover the best stocks before they are reported with our Earnings ESP Filter.

Bath & Body Works currently has an Earnings ESP of +2.57% and a Zacks Rank of 3.

Other Stocks With Favorable Combination

Here are some companies, which according to our model, have the right combination of elements to beat on earnings this time around.

BJ’s Wholesale Club (BJ Quick QuoteBJ - Free Report) has an Earnings ESP of +0.77% and a Zacks Rank of 3 at present. The Zacks Consensus Estimate for fiscal first-quarter earnings per share is pegged at 91 cents, which implies a 7.1% year-over-year increase.

You can see the complete list of today’s Zacks #1 Rank stocks here.

BJ’s Wholesale Club’s top line is expected to have increased year over year. The consensus estimate for quarterly revenues is pegged at $5.18 billion, which indicates a rise of 5.2% from the prior-year quarter’s actual. BJ delivered a trailing four-quarter earnings surprise of 12%, on average.

Deckers Outdoor (DECK Quick QuoteDECK - Free Report) presently has an Earnings ESP of +14.90% and a Zacks Rank of 3. The company is slated to register a top-line increase when it reports fiscal fourth-quarter results. The Zacks Consensus Estimate for DECK’s quarterly revenues is pegged at $985.6 million, which indicates growth of 2.7% from the figure reported in the prior-year quarter.

The consensus estimate for Deckers Outdoor’s quarterly earnings has increased 1 cent in the past 30 days to 56 cents per share. The estimate indicates a decline of 32.5% from the year-ago quarter’s reported number. DECK delivered an average earnings surprise of 36.8% in the trailing four quarters.

Urban Outfitters (URBN Quick QuoteURBN - Free Report) presently has an Earnings ESP of +1.03% and a Zacks Rank of 3. The company is slated to register a top-line increase when it reports fiscal first-quarter results. The Zacks Consensus Estimate for URBN’s quarterly revenues is pegged at $1.29 billion, which indicates growth of 7.1% from the figure reported in the prior-year quarter.

The consensus estimate for Urban Outfitters’ quarterly earnings has been unchanged in the past 30 days at 81 cents per share. The estimate indicates growth of 17.4% from the year-ago quarter’s reported number. URBN delivered an average earnings surprise of 28.4% in the trailing four quarters.