PVH (PVH) Q3 2025 earnings summary

Executive summary

• Third quarter revenue rose 2% year-over-year to $2.294 billion, surpassing guidance, with non-GAAP EPS of $2.83 exceeding the $2.35–$2.50 guidance range.

• Net income for the quarter was $4 million, down from $132 million in the prior year, mainly due to higher tax expense and earlier noncash impairment charges.

• Growth was driven by strong performance in Calvin Klein underwear and fashion denim, and Tommy Hilfiger core lifestyle categories, with digital channels in the Americas and APAC outperforming.

• Over 200 basis points in SG&A efficiencies were achieved over 18 months, and inventory levels remained healthy.

• The Growth Driver 5 Actions initiative is expected to generate $200–$300 million in annual cost savings by 2026, with $80 million in restructuring costs incurred year-to-date.

Financial highlights

• Revenue: $2.294 billion, up 2% year-over-year; constant currency revenue decreased less than 1%.

• Gross margin: 56.3%, down from 58.4% last year, mainly due to tariffs, promotions, and channel mix.

• SG&A as a percent of revenue improved by 40 basis points to 47.5% (non-GAAP), and 48.9% (GAAP), reflecting cost savings.

• Non-GAAP EBIT was $202 million, operating margin 8.8%, and non-GAAP EPS $2.83, with a $0.37 negative impact from tariffs.

• Inventory up 3% year-over-year, including a 2% increase from tariffs.

Outlook and guidance

• Full-year revenue outlook narrowed to up low single digits; constant currency revenue expected flat to up slightly.

• Non-GAAP operating margin reaffirmed at approximately 8.5%; non-GAAP EPS guidance narrowed to $10.85–$11.00, including $1.05/share negative tariff impact and $0.45/share positive FX impact.

• Q4 revenue projected to increase slightly to up low single digits; non-GAAP EPS guidance $3.20–$3.35.

• Gross margin for 2025 is projected to decrease by approximately 200–250 basis points, mainly from tariffs and channel mix.

• Effective tax rate for 2025 will be significantly elevated due to non-deductible impairment charges; excluding these, the rate is expected to be about 22%.