US' G-III Apparel holds FY26 sales forecast, posts higher Q1 earnings

As of June 5, 2025, current tariff rates are expected to add around $135 million in unmitigated costs, largely in the second half of the year. The company aims to offset these impacts through diversified sourcing, selective pricing adjustments, and cost-saving measures, it said in its financial statement.

For the second quarter (Q2) ending July 31, 2025, net sales are projected at $570 million, down from $644.8 million year-on-year, impacted by supply chain disruptions and timing shifts in key programmes. Gross margin is expected to remain stable. Net income is forecast between $1 million and $6 million, or $0.02–$0.12 per diluted share, sharply down from $24.2 million, or $0.53 per diluted share, in Q2 FY25.

For the first quarter (Q1) ended April 30, 2025, G-III Apparel Group has reported a 4 per cent year-on-year decline in net sales to $583.6 million, down from $609.7 million in the same period last year. Despite the revenue drop, net income rose to $7.8 million, or $0.17 per diluted share, compared to $5.8 million, or $0.12 per diluted share, in Q1 FY25.

On a non-GAAP basis, net income per diluted share came in at $0.19, excluding $1.0 million in one-time severance expenses related to a closed warehouse. This adjustment accounted for a $0.02 per share impact. There were no non-GAAP adjustments in the prior year’s first quarter.

As of the end of the quarter, inventories declined 5 per cent to $456.5 million, while total debt was slashed by 96 per cent to $18.7 million from $426.4 million. The sharp reduction followed the company’s voluntary redemption in August 2024 of its $400 million senior secured notes, financed through cash reserves and borrowings from its revolving credit facility, the statement added.

Additionally, the company repurchased 807,437 shares for $19.7 million during the quarter, underscoring its continued commitment to shareholder returns.

Morris Goldfarb, G-III’s chairman and chief executive officer, said, “G-III delivered solid first quarter results, marked by earnings that exceeded the high end of guidance. Our performance was fuelled by double-digit growth of our key owned brands, DKNY, Karl Lagerfeld and Donna Karan, which largely offset the exit of the Calvin Klein jeans and sportswear businesses. These results underscore the strong demand and desirability of our brand portfolio and are a testament to our team’s outstanding execution.”

Goldfarb concluded, “We are reaffirming our net sales guidance for fiscal 2026 and working diligently to mitigate the impact of tariffs. Our experienced management team has a proven track record of successfully navigating periods of uncertainty, and we view the ongoing disruptions as an opportunity to strengthen our competitive position and capture incremental market share. As we advance our strategic priorities, we have never been more confident in the global resonance of our brands and the significant growth potential ahead to drive long-term profitability and shareholder value.”

ALCHEMPro News Desk (KD)