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Europe and Americas Wholesale drive revenue gains despite mixed segment margins.
Cash stood at $154.2M as GES declared a quarterly dividend of 22.5 cents per share.
Guess?, Inc. ((GES - Free Report) ) reported third-quarter fiscal 2026 results, wherein both top and bottom lines beat the Zacks Consensus Estimate and increased year over year.
On Aug. 20, 2025, Guess? announced a deal with Authentic Brands Group and key shareholders to form a strategic partnership. Under the agreement, Authentic will acquire 51% of the company’s intellectual property, while the Rolling Stockholders will hold the remaining 49% and assume full ownership of its operating assets. As part of the proposed transaction, Guess? common stock will be delisted from public markets. The deal is expected to close in the fourth quarter of fiscal 2026.
Due to the proposed transaction, the company has suspended updates to its outlook.
Guess? posted adjusted earnings of 35 cents per share, beating the Zacks Consensus Estimate of 23 cents. The bottom line also increased 3% from 34 cents reported in the year-ago quarter.
Net revenues amounted to $791.4 million, up 7% year over year, surpassing the consensus mark of $774 million. On a constant-currency (cc) basis, net revenues rose 5%. This growth was primarily driven by strong performances in the Americas Wholesale and Europe segments.
Adjusted earnings from operations were $37 million, down 13.5% from $42.8 million reported in the year-ago quarter. The adjusted operating margin was 4.7%, down from 5.8% reported in the same quarter last year. This decline was primarily due to increased expenses, including store-related costs and increased markdowns, partially offset by the benefit of higher revenues.
Decoding GES’ Segmental Performance
The Europe segment’s revenues increased 10% on a reported basis and 6% at cc. Retail comp sales (including e-commerce) increased 7% on a reported basis and 2% at cc, with e-commerce contributing a 1% lift to both metrics. The segment’s operating margin declined 0.4 percentage points to 8.4%, primarily due to higher markdowns, partially offset by improved initial markups.
Revenues in the Americas Retail segment decreased 2% in U.S. dollars and at cc. Retail comparable sales, including e-commerce, declined 3% in U.S. dollars and at cc, with e-commerce negatively impacting comps by 3%. The operating margin fell 1 percentage point to negative 5.3%, due to negative comparable sales and higher markdowns, partially offset by lower expenses.
Americas Wholesale revenues surged 28% on a reported basis and 26% at cc. Despite the strong top-line growth, the operating margin decreased 2.9 percentage points to 22.8%, reflecting higher expenses, partially offset by the benefit of increased revenues.
Asia revenues declined 8% on a reported basis and 6% at cc. Retail comparable sales (including e-commerce) fell 5% in U.S. dollars and 2% at cc, with e-commerce weighing down comps by 3%. The operating margin deteriorated 2.5 percentage points to negative 4.5%, primarily due to lower product margins, partially offset by reduced expenses.
Licensing revenues were down 6% in both U.S. dollars and at cc. The operating margin dipped 0.7 percentage points to 91.1% compared with 91.8% in the prior-year quarter.
GES’ Financial Health Snapshot & Shareholder-Friendly Moves
The company exited the quarter with cash and cash equivalents of $154.2 million and long-term debt and finance lease obligations of nearly $299.5 million. Stockholders’ equity was around $508.5 million.
Net cash used in operating activities for the nine months ended Nov. 1, 2025, was $38 million. Free cash flow for the same period amounted to negative $103.3 million.
GES announced a quarterly dividend of 22.5 cents per share, payable on Dec. 26, 2025, to its shareholders on record as of Dec. 10.
Shares of this Zacks Rank #3 (Hold) company have risen 2.6% in the past three months against the industry’s 10% decline.
The Zacks Consensus Estimate for RL’s current fiscal-year sales and earnings indicates growth of 9.5% and 25%, respectively, from the year-ago reported figures. Ralph Lauren delivered a trailing four-quarter average earnings surprise of 9.8%.
Revolve Group, Inc. ((RVLV - Free Report) ) operates as an online fashion retailer for millennial and Generation Z consumers in the United States and internationally. It carries a Zacks Rank #2 at present. Revolve Group delivered a trailing four-quarter average earnings surprise of 48.8%.
The Zacks Consensus Estimate for RVLV’s current fiscal-year sales and earnings indicates growth of 6.8% and 8.7%, respectively, from the year-ago reported figures.
Kontoor Brands, Inc. ((KTB - Free Report) ), a lifestyle apparel company, designs, produces, procures, markets, distributes, and licenses denim, apparel, footwear, and accessories. It currently carries a Zacks Rank #2. KTB delivered a trailing four-quarter earnings surprise of 14%, on average.
The Zacks Consensus Estimate for Kontoor Brands’ current financial-year sales and earnings indicates growth of 19.4% and 12.5%, respectively, from the year-ago reported figures.
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Guess? Q3 Earnings Beat Estimates, Revenues Increase 7% Y/Y
Key Takeaways
Guess?, Inc. ((GES - Free Report) ) reported third-quarter fiscal 2026 results, wherein both top and bottom lines beat the Zacks Consensus Estimate and increased year over year.
On Aug. 20, 2025, Guess? announced a deal with Authentic Brands Group and key shareholders to form a strategic partnership. Under the agreement, Authentic will acquire 51% of the company’s intellectual property, while the Rolling Stockholders will hold the remaining 49% and assume full ownership of its operating assets. As part of the proposed transaction, Guess? common stock will be delisted from public markets. The deal is expected to close in the fourth quarter of fiscal 2026.
Due to the proposed transaction, the company has suspended updates to its outlook.
GES’ Quarterly Performance: Key Metrics & Insights
Guess? posted adjusted earnings of 35 cents per share, beating the Zacks Consensus Estimate of 23 cents. The bottom line also increased 3% from 34 cents reported in the year-ago quarter.
Guess?, Inc. Price, Consensus and EPS Surprise
Guess?, Inc. price-consensus-eps-surprise-chart | Guess?, Inc. Quote
Net revenues amounted to $791.4 million, up 7% year over year, surpassing the consensus mark of $774 million. On a constant-currency (cc) basis, net revenues rose 5%. This growth was primarily driven by strong performances in the Americas Wholesale and Europe segments.
Adjusted earnings from operations were $37 million, down 13.5% from $42.8 million reported in the year-ago quarter. The adjusted operating margin was 4.7%, down from 5.8% reported in the same quarter last year. This decline was primarily due to increased expenses, including store-related costs and increased markdowns, partially offset by the benefit of higher revenues.
Decoding GES’ Segmental Performance
The Europe segment’s revenues increased 10% on a reported basis and 6% at cc. Retail comp sales (including e-commerce) increased 7% on a reported basis and 2% at cc, with e-commerce contributing a 1% lift to both metrics. The segment’s operating margin declined 0.4 percentage points to 8.4%, primarily due to higher markdowns, partially offset by improved initial markups.
Revenues in the Americas Retail segment decreased 2% in U.S. dollars and at cc. Retail comparable sales, including e-commerce, declined 3% in U.S. dollars and at cc, with e-commerce negatively impacting comps by 3%. The operating margin fell 1 percentage point to negative 5.3%, due to negative comparable sales and higher markdowns, partially offset by lower expenses.
Americas Wholesale revenues surged 28% on a reported basis and 26% at cc. Despite the strong top-line growth, the operating margin decreased 2.9 percentage points to 22.8%, reflecting higher expenses, partially offset by the benefit of increased revenues.
Asia revenues declined 8% on a reported basis and 6% at cc. Retail comparable sales (including e-commerce) fell 5% in U.S. dollars and 2% at cc, with e-commerce weighing down comps by 3%. The operating margin deteriorated 2.5 percentage points to negative 4.5%, primarily due to lower product margins, partially offset by reduced expenses.
Licensing revenues were down 6% in both U.S. dollars and at cc. The operating margin dipped 0.7 percentage points to 91.1% compared with 91.8% in the prior-year quarter.
GES’ Financial Health Snapshot & Shareholder-Friendly Moves
The company exited the quarter with cash and cash equivalents of $154.2 million and long-term debt and finance lease obligations of nearly $299.5 million. Stockholders’ equity was around $508.5 million.
Net cash used in operating activities for the nine months ended Nov. 1, 2025, was $38 million. Free cash flow for the same period amounted to negative $103.3 million.
GES announced a quarterly dividend of 22.5 cents per share, payable on Dec. 26, 2025, to its shareholders on record as of Dec. 10.
Shares of this Zacks Rank #3 (Hold) company have risen 2.6% in the past three months against the industry’s 10% decline.
Image Source: Zacks Investment Research
Stocks to Consider
Ralph Lauren Corporation ((RL - Free Report) ) designs, markets and distributes lifestyle products in North America, Europe, Asia and internationally. It currently holds a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The Zacks Consensus Estimate for RL’s current fiscal-year sales and earnings indicates growth of 9.5% and 25%, respectively, from the year-ago reported figures. Ralph Lauren delivered a trailing four-quarter average earnings surprise of 9.8%.
Revolve Group, Inc. ((RVLV - Free Report) ) operates as an online fashion retailer for millennial and Generation Z consumers in the United States and internationally. It carries a Zacks Rank #2 at present. Revolve Group delivered a trailing four-quarter average earnings surprise of 48.8%.
The Zacks Consensus Estimate for RVLV’s current fiscal-year sales and earnings indicates growth of 6.8% and 8.7%, respectively, from the year-ago reported figures.
Kontoor Brands, Inc. ((KTB - Free Report) ), a lifestyle apparel company, designs, produces, procures, markets, distributes, and licenses denim, apparel, footwear, and accessories. It currently carries a Zacks Rank #2. KTB delivered a trailing four-quarter earnings surprise of 14%, on average.
The Zacks Consensus Estimate for Kontoor Brands’ current financial-year sales and earnings indicates growth of 19.4% and 12.5%, respectively, from the year-ago reported figures.