G-III Apparel Group (GIII) Q1 2026 earnings summary

Executive summary

• First quarter net sales declined 4.3% year-over-year to $583.6 million, but net income rose to $7.8 million, driven by double-digit growth in owned brands DKNY, Karl Lagerfeld, and Donna Karan, offsetting the exit of Calvin Klein and Tommy Hilfiger licenses.

• Non-GAAP net income was $8.4 million ($0.19 per diluted share), up from $5.8 million ($0.12 per share) year-over-year, both exceeding guidance.

• Gross margin was 42.2%, slightly down from 42.5% last year, with retail segment margin improving to 53.5% from 47%.

• Management reaffirmed FY26 net sales guidance and highlighted efforts to mitigate tariff impacts, while remaining cautiously optimistic about the consumer environment.

• Maintained a strong financial position with $740 million in liquidity and significant debt reduction after redeeming $400 million in senior secured notes.

Financial highlights

• Net sales for Q1 FY26 were $583.6 million, down from $609.7 million year-over-year, in line with guidance.

• Net income for Q1 FY26 was $7.8 million, up from $5.8 million in Q1 FY25.

• Gross profit was $246.5 million, down from $258.9 million; retail gross margin improved to 53.5% from 47.0%.

• SG&A expenses decreased to $231.5 million from $236.6 million, with lower advertising and compensation costs offset by higher bad debt expense.

• Share repurchases totaled $19.7 million (807,437 shares) in Q1 FY26.

Outlook and guidance

• Fiscal 2026 net sales expected at approximately $3.14 billion, with Q2 FY26 net sales guidance of $570 million and non-GAAP EPS of $0.02–$0.12.

• Net income, non-GAAP net income, and adjusted EBITDA guidance for FY26 withdrawn due to tariff and macroeconomic uncertainty.

• Anticipates low single-digit sales increase in Q3 and mid single-digit in Q4, driven by new launches.

• Management is monitoring tariff changes, supply chain disruptions, and inflation, and is taking steps to diversify sourcing and manage costs.

• Ongoing volatility in consumer demand and shipping costs expected due to global trade and geopolitical factors.