Bath & Body Works reported fiscal third‑quarter 2025 results that fell short of analyst expectations, with net sales of $1.594 billion—a 1 % year‑over‑year decline—and diluted earnings per share of $0.37, compared with $0.49 in the same quarter a year earlier. The company’s adjusted EPS, after excluding a $6 million after‑tax gain from the sale of a non‑core asset, was $0.35, missing the consensus estimate of $0.40 by $0.05 or 12.5 %. Revenue also missed the consensus of $1.63 billion by $0.04 billion, a shortfall of roughly 2.5 %.
Operating income dropped to $161 million from $218 million year‑over‑year, while the gross‑profit rate contracted 220 basis points to 41.3 %. The decline reflects higher promotional spending and a shift toward lower‑margin product categories, as well as increased input costs. The company’s operating margin fell to 9.9 % from 10.2 % in the prior year, underscoring the pressure on profitability amid a softer consumer environment.
Management lowered its full‑year 2025 guidance, projecting a low‑single‑digit decline in net sales and a diluted EPS range of $2.83 to $3.29, down from the previous $3.25 to $3.60 range. CEO Daniel Heaf said the company remains confident in its “Consumer First Formula” strategy, which focuses on product innovation, digital enhancements, and international expansion. He noted that the Disney Villains collection did not generate the expected consumer response and that the start of the holiday season was “very challenging.”
Segment‑level data show that U.S. and Canadian store sales were flat, while direct‑sales channels declined, contributing to the overall revenue shortfall. International sales, however, grew modestly, providing a tailwind that helped offset domestic weakness. The company’s cost‑savings initiative aims to deliver $250 million in savings over two years, with more than half earmarked for 2026, and it plans to reinvest the proceeds in revenue‑generating initiatives.
As of the end of Q3 2025, Bath & Body Works operated 1,934 company‑operated stores in the United States and Canada, up from 1,904 the previous year, and maintained 537 franchised international locations. The expanded footprint supports the company’s strategy to capture growth in international markets while maintaining a strong domestic presence.
The content on BeyondSPX is for informational purposes only and should not be construed as financial or investment advice. We are not financial advisors. Consult with a qualified professional before making any investment decisions. Any actions you take based on information from this site are solely at your own risk.