Guess? Inc. (NYSE: GES) posted mixed second-quarter fiscal 2025 results, with the top line increasing year over year. The bottom line declined from the year-ago quarter's reported figure and missed the consensus mark.
The company is lowering its fiscal 2025 revenue and earnings outlook to reflect the current weaker consumer environment. That said, it is effectively managing its costs and inventories while still supporting business growth through investments in marketing, new stores and infrastructure. The acquisition of rag & bone is likely to have contributed to the positive performance.
GES's Quarterly Performance: Key Metrics & Insights
GES reported adjusted earnings of 42 cents per share that missed the Zacks Consensus Estimate of 44 cents. However, the bottom line declined 42% from earnings of 72 cents in the year-ago quarter. The company's bottom-line performance reflects its decision to substantially boost marketing investments compared with last year's levels. This increased spending was aimed at supporting the international expansion of its brands, including the core Guess brand and the new additions to the portfolio, such as Guess Jeans and rag & bone.
Net revenues amounted to $732.6 million, up 10% year over year. On a constant-currency (cc) basis, net revenues rose 13%. The strong performance was driven by the Rag & Bone acquisition and robust wholesale results in Europe and Americas regions. All segments, except Asia, registered top-line growth. The consensus mark for quarterly revenues was pegged at $732 million.
Guess?, Inc. Price, Consensus and EPS Surprise
Guess?, Inc. price-consensus-eps-surprise-chart | Guess?, Inc. Quote
Gross margin contracted to 43.7% from 44.3% reported in the year-ago quarter. As a percentage of sales, SG&A expenses increased to 38.7% from 34.6% in the prior-year quarter's level.
Adjusted earnings from operations were $37.9 million, down 41.6% from $65 million reported in the year-ago quarter. The adjusted operating margin came in at 5.2%, down from 9.8% reported in the same quarter last year. The downtick ...
