JILL

Image source: The Motley Fool. Wednesday, Sept. 9, 2026 at 8:00 a.m. ET President and Chief Executive Officer - Mary Ellen Coyne Operator: Hello, everyone. Thank you for joining us, and welcome to the J.Jill, Inc. Second Quarter 2026 Earnings Call. Before we begin, I need to remind you that certain comments made during these remarks may constitute forward-looking statements and are made pursuant to and within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, as amended. Such forward-looking statements are subject to both known and unknown risks and uncertainties that could cause actual results to differ materially from such statements. Those risks and uncertainties are described in the press release and J.Jill's SEC filings. The forward-looking statements made on this recording are as of September 9, 2026, and J.Jill does not undertake any obligation to update these forward-looking statements. Finally, J.Jill may refer to certain adjusted or non-GAAP financial measures during these remarks. A reconciliation schedule showing the GAAP versus non-GAAP financial measures is available in the press release issued September 9, 2026. If you do not have a copy of today's press release, you may obtain one by visiting the investor relations page of the website at jjill.com. I will now hand the conference over to Mary Ellen Coyne, CEO and President. Please go ahead. Mary Ellen Coyne: Good morning, and thank you for joining us. Our second quarter results indicate a meaningful step forward and reflect the progress we are making across each of our three strategic priorities: evolving the product assortment, enhancing the customer journey, and advancing the way we work. We are thrilled to have delivered results that exceeded our expectations and represented a significant improvement in trend from the first quarter. This momentum has carried over into the start of the third quarter and gives us confidence to raise our guidance for the year, while strategically deploying tariff refunds to invest in the business. Before we discuss our outlook, let me provide highlights from our second quarter results. Net sales for the second quarter increased compared to last year, supported by an improving trend in our full price business across both stores and direct. In the direct channel, we continued to enhance the product detail page experience with improved fabric and fit information, as well as richer item-level storytelling. This channel also benefited from increased markdowns given the seasonal sale period. In stores, we saw positive traffic for the quarter where our teams are effectively engaging existing, returning, and new customers with the energy and expertise that differentiate the J.Jill in-store experience. In terms of profitability, we delivered adjusted EBITDA of $20.1 million, excluding the benefit of tariff refunds and the actions we initiated in the quarter to strategically invest in the business. My confidence in the quarter's results goes deeper than the numbers to the source of the progress. From meaningful improvement in customer acquisition and more effective marketing to stronger product execution. The customer file is stabilizing and new to brand acquisition is accelerating. Exactly the combination we have been working towards. Huge thanks to our teams who are aligned and delivering with speed and precision. With that said, I want to put our progress in context. While we are encouraged by both the direction and momentum, we are still in the early stages of this evolution. Each quarter, we learn more about our customer, sharpen our assortment strategy, and continue to strengthen and build the capabilities that will drive sustainable long-term growth. Let me walk you through our three areas of strategic focus. I'll start with evolving the product assortment. Our Q2 assortment represented continued progress and reinforced important learnings that will directly inform the second half. We saw meaningful strength in a number of categories, particularly outerwear and accessories. Accessories has been a standout as it scales, which we expect to continue into Q3. We are also very encouraged by the introduction of our Luxe Lounge collection and the relaunch of our denim assortment, which are seeing great early results. In terms of opportunity, customer purchasing behavior and direct feedback point to an appetite for more color and more breadth. We heard this in Q1, and we are taking action that will begin to be seen in our fall and holiday assortments. We anticipate these kinds of learning cycles as we move forward, and I am proud of how the team is incorporating feedback and reacting in real time. We are constantly evaluating the assortment to make sure we are serving both our most loyal existing customers and the newer customers we are attracting into the brand. We are also modernizing our sub-brand portfolio. We are consolidating the best-selling pieces of the Wearever sub-brand into the core J.Jill assortment in a way that preserves what customers love about it. This is a deliberate decision to simplify our lineup and reallocate investment into areas where we see the most growth potential. For example, Luxe Lounge, which include our travel capsules and denim, an important lifestyle component of the brand, are now building into meaningful categories. Pure Jill, our most iconic sub-brand, known for quality and craftsmanship, remains a priority. Looking ahead to the second half, we are entering it with a stronger and more strategically aligned product framework. Our design and merchandising teams are fully in sync. The early reads on our fall assortments are encouraging, and we expect gradual sequential improvement to continue. Turning to enhancing the customer journey, this was a standout area in Q2, thanks to the significant progress made by our teams. Our total customer file saw improvement from the start of the year and is showing signs of stabilization from which we have a foundation to grow. That improvement was driven by strong new-to-brand acquisition and continued success reactivating lapsed customers. The profile of our new-to-brand customer is also improving, with a slightly younger customer coming into the file. These are early indicators that our approach to broadening the appeal of the brand is resonating with the evolving J.Jill customer without disrupting the deep relationship we have with our highly loyal base. We are also seeing these new-to-brand customers spend more with us than in recent history, driven by higher average order value and more trips, both of which are encouraging. Supporting this success is our marketing engine, which is performing well across channels, driving new customer acquisition, and generating stronger returns on our investment. SMS continued its growth trajectory with our subscriber file scaling nicely, and our catalog is delivering improved profitability with disciplined optimization, driving better returns on a more focused circulation base. Our loyalty program is also showing encouraging early signs, with members retaining at a meaningfully higher rate than non-members. Behind that, our marketing team is bringing together J.Jill Credit Card and our loyalty program, J.Jill Inspired Rewards, into a more unified view of the customer, organized around two clear areas of focus, acquisition and retention. Historically, the vast majority of our marketing investment has gone toward existing customers and capturing demand we know is there. We are actively rebalancing this mix toward prospective and reactive customers while building broader brand awareness to drive demand generation. Looking ahead, we are investing even more into these efforts, deploying tariff refunds into second-half marketing, including at the top and middle of the funnel, an investment this year that we believe will have a continued impact as we move into next year and beyond. On our third pillar, advancing how we work, we continue to strengthen and build the capabilities that will support our business at a higher level over time. We are increasingly leveraging AI-enabled tools to drive efficiencies across the organization, and our teams are utilizing these new tools to increase capacity, improve decision-making, and unlock new ways of working. Our new AI-enabled merchandise planning and allocation system is on track to begin launching later this year and will be an important new tool to support full price selling, which will drive top and bottom-line growth. In addition to this work, we are also progressing on several investments to enhance our digital platform and personalization technology, both of which will modernize our digital business. Additionally, we are utilizing a portion of the tariff refunds to pull forward the kickoff of exciting technology initiatives into fiscal 2026 that should deliver benefits earlier in 2027. It is important to note that we have made the intentional decision to invest most of the refunds into these strategic initiatives, which we believe improves the customer experience, strengthens the business, and positions us for a more productive 2027. We are also moving forward with a strong team fully in place. The energy across the organization is palpable. This was highlighted in our recent denim launch. The product teams tested new shapes and moved quickly once we saw which resonated most strongly. Our marketing team developed an integrated influencer campaign that drove exceptional early engagement with nearly 1 million impressions in the campaign's first three days alone. Our stores brought the launch to life with dedicated fit events and activations, and our website team built dedicated content to support it. This is a great proof point of what we can achieve when our product, marketing, stores, and direct teams are fully and seamlessly aligned. With that, I'll turn it over to Mark to speak to the details of our financials and our updated outlook. Mark: Thank you, Mary Ellen, and good morning, everyone. We are very pleased with our second quarter performance, as Mary Ellen reviewed. We delivered sales growth above our guidance and underlying adjusted EBITDA of $20.1 million. This underlying performance excludes the $13.3 million in net tariff refunds received in the quarter, as well as the deliberate decision to begin to invest in strategic initiatives and, to a lesser extent, cover emerging cost pressures from fuel surcharges on shipping. In the second quarter, about $600,000 of the refund was absorbed by these investments and costs. The receipt of the tariff refunds presents an opportunity, and we have made a deliberate decision to invest most into strategic priorities we believe strengthens the business, supports our momentum, and sets us up well for 2027. Both our third quarter and full year outlooks, which I'll discuss in a moment, reflect this decision. First, I'll review second quarter results. Total company sales for second quarter were $154.8 million, up 0.5% compared to Q2 2025. Total company comparable sales for the quarter were up 0.5%. Non-comp sales from new stores were offset by timing associated with reserves. Looking ahead, we expect non-comp spread will normalize between 1 and 2 percentage points. Store sales for Q2 were down 0.7% compared to Q2 2025, as strength in full price sales was more than offset by a decline in markdown selling in stores during the quarter. Direct sales, which represented about 47% of total sales in the quarter, were up 1.9% compared to second quarter of fiscal 2025, driven by higher markdown sales during the quarter. As Mary Ellen mentioned, we did see a meaningful improvement in full price sales performance versus prior year in second quarter compared to first quarter full price year-over-year results. Q2 total company gross profit, including the impact of net refunds, was about $119 million, up $13.6 million compared to Q2 2025. Q2 gross margin was 76.8%, up about 840 basis points versus Q2 2025. Excluding net tariff refunds, gross profit was $105.7 million and gross margin was 68.3%, about flat versus Q2 last year as a higher full price gross margin rate offset a greater mix of markdown sales compared to last year. SG&A expenses for the quarter were about $94.6 million, compared to approximately $88.6 million last year. The increase was driven by store expenses due to eight net new stores compared to second quarter last year, increased occupancy costs on lease renewals, marketing expense, including strategic investments mentioned, shipping expenses due in part to fuel surcharges, and higher management incentive accruals. Adjusted EBITDA for second quarter was $32.8 million, compared to $25.6 million in Q2 2025. Excluding the tariff refunds and the approximately $600,000 related to the strategic investments and costs I mentioned, adjusted EBITDA for the second quarter was $20.1 million. All forward guidance we are providing today include net tariff refunds as well as our strategic investments and cost coverage assumptions. Total interest expense was $1.9 million in the second quarter, compared to $2.7 million last year. Adjusted net income per diluted share was $1.24 compared to $0.81 last year, which reflected an average weighted diluted share count of 15.1 million shares this year versus 15.3 million shares last year. We repurchased about 100,000 shares for approximately $1.5 million in the second quarter, bringing year to date repurchases to 168,000 shares for $2.3 million, resulting in approximately $0.01 of benefit to reported second quarter adjusted diluted EPS. As of the end of the second quarter, we had approximately $11.8 million remaining on the $25 million share repurchase authorization. We also paid our quarterly dividend of $0.09 per share on July 8, and as announced on September 2, our board approved payment of the Q3 dividend on October 7 to shareholders of record as of September 23. Please refer to today's press release for reconciliations of non-GAAP financial measures to their most comparable GAAP financial measures. Turning now to the balance sheet. For the quarter, cash from operations was about $46 million, including approximately $19 million related to gross tariff refunds. Ending cash, including these refunds, was about $77 million, with funded debt on the balance sheet of approximately $72 million. Excluding the impact of refunds, cash from operations was approximately $27 million, and free cash flow was approximately $25 million in the quarter. Looking at inventory, we ended second quarter with inventories in good shape, down about 5% compared to end of second quarter last year. We are now anniversarying incremental tariff expenses that previously impacted year-over-year comparisons. So reported inventory growth is now on a like-for-like basis. Capital expenditures for the quarter were about $2 million compared to $3 million last year. Spend was focused primarily on store projects, including anticipated openings and the merch planning and allocation project expected to launch later this year. With respect to store count, we did not open or close any stores during the second quarter, resulting in end of quarter store count of 255 stores compared to 247 stores at end of Q2 last year. Now turning to our outlook. As mentioned, we made the deliberate decision to strategically invest the majority of the net tariff refunds. These investments are primarily focused on marketing to build the brand and accelerate file growth, which will in part support second half 2026 sales growth while also benefiting 2027 and beyond. The outlook we are providing today takes into consideration the refunds as well as these investments, which we expect will be fairly evenly split between the third and fourth quarters. This will result in a bigger impact to Q4 given the relative size of EBITDA historically in this quarter. In addition, given the evolving tariff regulations, we now are estimating tariff rates will land at 10%-12.5% for goods landed in the second half. For our third quarter outlook, we expect adjusted EBITDA to be in the range of $20 million-$22 million. This range assumes sales will be up 3%-5% for the quarter and comps will be up 1%-3%. Gross margins are assumed to be about flat compared to last year. Second half tariff costs at current rates are expected to be down approximately $1 million compared to our prior expectations and down versus last year, beginning in fourth quarter. With respect to full year, we are updating our full year outlook as follows. Adjusted EBITDA now expected to be in the range of $75 million-$80 million, which reflects tariff refunds received, partially offset by the investments and costs I mentioned. Sales are now expected to be flat to up 2% versus last year. Comp sales are expected to be between down 1% to up 1%, and gross margin, reflecting in part the benefit of tariff refunds, is expected to be up 100 to 150 basis points versus prior year. With respect to full year capital expenditures, we continue to expect spend of between $20 million and $25 million. Regarding store count, we now expect to open between one and three net new stores this year, with two planned to open in the third quarter. The slight reduction versus prior guide is due to landlord delivery delays on two stores that will most likely push those openings into early 2027. Finally, with respect to free cash flow, we now expect free cash flow of approximately $40 million. As previously mentioned, we announced our quarterly dividend of $0.09 per share payable on October 7th to shareholders of record on September 23rd. We have repurchased approximately 168,000 shares year to date for about $2.3 million, including the repurchase of 100,000 shares in Q2. Since launching our repurchase program in Q4 2024, we have repurchased about 826,000 shares for $13.2 million, leaving approximately $11.8 million of the original $25 million authorization available. Thank you. I will now turn it back over to Mary Ellen for some closing remarks. Mary Ellen Coyne: Thanks, Mark. Before we take your questions, let me leave you with a few key takeaways. First, we beat our expectations on both sales and profitability and showed meaningful sequential improvement in virtually every metric that matters. Second, our customer file is stabilizing. New to brand acquisition continues to grow, the profile of our incoming customer is younger, and reactivation is building momentum. The most important indicators of customer health are all pointing in the right direction. Third, we know exactly where to focus in the second half and how to scale what is working with discipline and intention. Finally, the work ahead is rooted in the same priorities I described today, evolving the product assortment, enhancing the customer journey, and advancing the way we work. These three priorities will continue to drive our progress in the business. While we are still early in this evolution, we are confident we are making the right decisions today to position this brand for sustainable long-term growth, and we appreciate your ongoing interest in our future. Now we'll take your questions. Operator? Operator: We will now begin the question and answer session. Please limit yourself to one question and one follow-up. If you would like to ask a question, please press star one to raise your hand. Please stand by while we compile the Q&A roster. Your first question comes from the line of Jonna Kim with TD Cowen. Jonna, your line is open. Please go ahead. Jonna Kim: Thanks. Thank you for taking my question. My first question is around marketing. Obviously, you've seen a lot of success, and you talked about the details of where you're deploying additional marketing. Is the guide that you're giving currently reflect the potential benefit from higher investment? How would that sort of look like as you look at second half in terms of just as you noted, middle to upper funnel and influencer, but sort of what are key strategic areas you're looking to spend more on? The second question is just around the holiday. How are you thinking about this holiday differently than last year? What are key learnings that you're implementing this year versus last year? Thank you. Mary Ellen Coyne: Hi, Jonna. Thank you for the question. For half two, when we think about marketing as we're moving forward, we are investing across the board, really taking the learnings that we've had in Q1 and Q2, especially. In Q2, our strategy under the new leadership in place with Kimberly here was really a refinement in execution, really sharpening our messaging, and moving into segmentation strategies within our owned channels. Yes, we have invested some of that money. As Mark said in his remarks, $600,000 went to marketing efforts, which we believe we'll see in Q2, and we will release some in the back half that will return for us. But the more important investment for us is really when we think about demand generation and the awareness play that will impact 2027 and beyond. Right? The way we're thinking through marketing in the second half is really looking at demand generation leading to awareness, which then leads to consideration, which then leads to intent to purchase. As we go through that journey through the second half, we believe our investments will return really second half and beyond. We're looking to 2027 and future to really build that customer file. With respect to holiday, what I would say is, we've taken the learnings from Q1 and Q2, and we are looking to drive, keep this momentum in our full price business as we head into holiday. We know that it will be an exceptionally promotional time across the board, but as much full price momentum as we can continue to drive will allow us to really limit the promotions that we need, or at least be less dramatic than we've been in the past. I will say that the team has done a great job in reading and reacting to some things that have worked, and on the periphery, are able to chase into best-selling items. We're encouraged about Q4, again, because the learnings will allow us to build product assortments and marketing strategies. Really being able to connect those two is where we see the win, right? When marketing is able to drive what the product teams are putting out there is where we will be successful, and I think, as you know, we're very excited to really have a year under our belt with the design and merchandising teams working together, and now having that fully supported by marketing is what's giving us confidence as we move forward. Jonna Kim: Got it. Thank you so much. Operator: Your next question comes from the line of Janine Stichter with BTIG. Janine, your line is open. Please go ahead. Janine Stichter: Hi. Thanks so much for taking my question, and congrats on the progress. I guess to start, love if you could share a bit more about the new-to-brand customer that you're seeing. You mentioned it's a younger customer. Maybe elaborate more on who that customer is, and then what you're seeing in terms of retention, how you're balancing a new customer that you're attracting versus the existing customer. Then would love your insights on the bottoms category. It sounds like denim has been really strong. I think last quarter you had talked about some challenges in that category. Maybe weigh in on what you think is industry-wide versus it sounds like a lot of your own execution is really coming in here with the denim relaunch. Thank you. Mary Ellen Coyne: Thanks, Janine. I'll start with new to brand, and yes, our new to brand customer is coming in younger than our existing, which we are very excited about. She also is retaining at a higher rate, and she is spending more than we have seen her spend historically. So really successful across all fronts there. At the same time, we are seeing a reactivation customer come back also with the same metrics, which is exciting. In terms of retention, right now the team is really thinking about personalization and segmentation, and how they are messaging the new to brand journey, how they are keeping that customer engaged versus a reactivated versus an existing customer. That is a lot of the work that is ahead of us as we move forward into half two. Both from the marketing side, but also from the experience in store and the experience on the direct channel, which we're spending a tremendous amount of time working on personalization there. With respect to bottoms, what we see is very encouraging. As we move through Q2, bottoms stabilized, and what we saw was success in some of our core items, which we have historically run our pull-on linen pants, but we also saw success in new leg shapes, and that's what's really encouraging for us as we move forward and has happened through the denim launch. We're seeing that where we have credibility in a fit, if we are taking that same fit and then offering new leg shapes, the wide leg happens to be a standout right now in denim. The customer is absolutely responding to that newness. She's responding to a barrel silhouette. So we're excited to see that bottoms is now working on both the basic side and the fashion side. Janine Stichter: Great. Thanks so much. Operator: As a reminder, if you would like to ask a question, please press star one to raise your hand. Your next question comes from the line of Marni Shapiro with The Retail Tracker. Marni, your line is open. Please go ahead. Marni Shapiro: Hey, guys. Congratulations. I think the stores have looked amazing. I felt like I visually watched that turn happen, and I had stumbled into that denim event, and it was packed, and your sales associates were unbelievable. It was a party in there. So a couple of quick questions. Just historically, what did denim look like for J.Jill? And I guess what could it be for J.Jill? And then I have one or two other quick ones. So I am curious about what denim could look like there. Mary Ellen Coyne: Great. So what I would say, Marni, in the past is our denim was very one-note. The customer liked the fit of our authentic jeans, but it tended to always be a slim silhouette, and we ran it on repeat, and it was very much fulfilling a piece of her lifestyle that was very casual. What we are seeing now is the expansion of the denim assortment from, again, staying with that trusted fit in terms of the upper, but giving her new fashion leg shapes, and then advancing denim to go to the other two fits that we have, a modern wide leg and then some fashion denim trousers. It is allowing for denim to become something that is important to every aspect of her lifestyle instead of just when she is super casual. We're really seeing the end use of it expand as we're giving her new leg shapes and new silhouettes. Marni Shapiro: Okay. That makes so much sense because you already have a lot of that in your non-denim bottoms, like in your Ponte and stuff like that. Can we also just talk a little bit about the difference between your online consumer versus your in-store consumer? Because I think you mentioned that you're selling more at full price, but that I think online there was more sale. So are the metrics similar? Does the consumer, are they buying as much, same UPTs in store as online, same AUR in store as online, or does the in-store consumer tend to be more fully outfitted, more UPTs, higher AUR because it's full price, and online is a little more picky, choosy? Can you just talk a little bit about the difference there? Mary Ellen Coyne: What we're super excited about, Marni, is that both stores and the direct channel have seen significant improvement in full price selling. We're very optimistic about that as we move forward. As you know, and as we said in our remarks, the direct channel will always be a source of selling through markdown product in a very profitable way. They always are. We see AUR and ATV all improving in both channels. That's what we're most excited about, is the momentum across the business. Marni Shapiro: Fantastic. I'll leave it for somebody else. Congratulations, you guys. Best of luck with fall. Mary Ellen Coyne: Thanks, Marni. Operator: Your next question comes from the line of Dana Telsey with Telsey Advisory Group. Dana, your line is open. Please go ahead. Dana Telsey: Thank you, and nice to see the progress. Given the product enhancements that are resonating, can you talk a little bit about tops also? I think in the first quarter, I think some of them were too short or more tunics were wanted, and dresses improved to offset the bottoms. So what are you seeing in tops and dresses, and color versus neutral? Thank you. Mary Ellen Coyne: Good morning, Dana. Thanks for the question. I will say, the good news for us is that, again, tops really stabilized for us in Q2, given the learnings that we saw in Q1 and what we were able to respond to. We absolutely believe we were not balanced enough in Q1 and have course corrected that as we move forward. The other thing I will say with tops particularly, and it ties to your third question, which is around color, we really need to have color extensions in our top programs. Where the miss was in tops, and I will say in dresses, so this is a perfect way to tie in all of your questions, was a lack of color and print. Where we had color and print, it was very successful. We learned in Q1 that we did not have enough, we were too neutral, and Q2 was obviously too soon to impact. What we have done for Q3 and Q4 is add color to programs wherever possible, particularly in tops and prints in tops and dresses wherever we could, because that is where we are seeing tremendous success. So we have rebalanced the silhouette, and we have added color and print back in specifically to the top and dress categories as we are moving forward. Q3 and Q4 are certainly an improvement from where we were Q1 and Q2. When we get to Q1 of 2027, we are back in an ideal position. Dana Telsey: Got it. Then the tariff refund investments. Mark, how would you characterize them, or is there buckets where tariff refunds are going most to? Is it marketing? Just any shaping of Q3 and Q4 reminders that we should be aware of. Thank you. Mark: Sure, Dana. We mentioned that the receipt of the refund in Q2 really just presents an opportunity for us. We are leaning into that momentum and taking advantage of the opportunity to invest primarily in marketing. Mary Ellen spoke a little bit about it, but that Q3 and Q4 sales guide range is a little bit of the momentum we have seen, a little bit of the expected return from new marketing investments. But really, the investment is a down payment on the file and on delivering 2027 and beyond. More upper funnel, more mid funnel, awareness driving, brand building, et cetera. We mentioned in my remarks there are some emerging costs. It is not the majority by far, but some emerging costs out there around fuel surcharges, et cetera. Then we have some exciting initiatives underway that we are looking to launch this year that may have not launched until next year, just again, taking advantage of the opportunity that the tariff refunds represent. So the guidance that we provided for the full year now forward includes the refund, and it includes the impact of those investments. Dana Telsey: Thank you. Mark: Welcome. Operator: We have reached the end of the Q&A session. I will now turn the call back to Mary Ellen for closing remarks. Mary Ellen Coyne: Thank you all for joining us this morning and for your continued interest in J.Jill. We look forward to speaking with you again next quarter. Have a great day. Operator: This concludes today's call. Thank you for attending. You may now disconnect. Before you buy stock in J.Jill, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and J.Jill wasn’t one of them. The 10 stocks that made the cut are built for long-term growth and could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $414,015!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,385,459!* That performance is why people listen. With a track record of beating the S&P 500 by 4x, Stock Advisor offers a distinct advantage. Don't miss the latest top 10 list, available with Stock Advisor, and join an investing community built for the long haul. See the 10 stocks » *Stock Advisor returns as of September 9, 2026. This article is a transcript of this conference call produced for The Motley Fool. While we strive for our Foolish Best, there may be errors, omissions, or inaccuracies in this transcript. As with all our articles, The Motley Fool does not assume any responsibility for your use of this content, and we strongly encourage you to do your own research, including listening to the call yourself and reading the company's SEC filings. Please see our Terms and Conditions for additional details, including our Obligatory Capitalized Disclaimers of Liability. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. J.Jill (JILL) Q2 2026 Earnings Call Transcript was originally published by The Motley Fool

Q2 FY26 Net Sales Increased 0.5% to $154.8 Million vs. Q2 FY25 Q2 FY26 Gross Margin of 76.8%, Includes $13.3 Million IEEPA Tariff Refund Pre-Tax Net Benefit Raises FY26 Outlook QUINCY, Mass., September 09, 2026--(BUSINESS WIRE)--J.Jill, Inc. (NYSE:JILL) ("J.Jill" or the "Company") today announced financial results for the second quarter of fiscal year 2026. Mary Ellen Coyne, President and Chief Executive Officer of J.Jill, Inc. stated, "Our second quarter results reflect progress across each of our three strategic priorities – evolving the product assortment, enhancing the customer journey, and advancing the way we work. We delivered sales that exceeded our expectations, with underlying profitability at the high end of our outlook before the benefit of tariff refunds. Our customer file is stabilizing, new-to-brand acquisition is accelerating, and our senior team is in place and executing. While we are still in the early stages of this evolution, we are pleased with our momentum and are strategically investing in the business to position J.Jill for sustainable, long-term growth." For the second quarter ended August 1, 2026: Net sales for the second quarter of fiscal 2026 increased 0.5% to $154.8 million compared to $154.0 million for the second quarter of fiscal 2025. Total company comparable sales, which includes comparable store and direct to consumer sales, increased by 0.5% for the second quarter of fiscal 2026. Direct to consumer net sales, which represented 47.1% of net sales, were up 1.9% compared to the second quarter of fiscal 2025. Gross profit was $119.0 million compared to $105.4 million in the second quarter of fiscal 2025. Gross margin was 76.8% compared to 68.4% in the second quarter of fiscal 2025. Excluding the receipt of $13.3 million of net tariff refunds in the second quarter of fiscal 2026 gross margin was 68.3%. SG&A was $94.6 million compared to $88.6 million in the second quarter of fiscal 2025. SG&A as a percentage of total net sales was 61.1% compared to 57.5% in the second quarter of fiscal 2025. The increase was primarily driven by eight net new stores compared to prior year, store lease renewals, marketing, shipping costs and management incentive accruals. Operating income was $24.3 million compared to $16.8 million in the second quarter of fiscal 2025. Operating income margin for the second quarter of fiscal 2026 was 15.7% compared to 10.9% in the second quarter of fiscal 2025. Adjusted Income from Operations*, which includes the benefit of net tariff refunds, was $27.1 million compared to $19.6 million in the second quarter of fiscal 2025. Interest expense was $1.9 million compared to $2.7 million in the second quarter of fiscal 2025. Interest income was $1.1 million in the second quarter of fiscal 2026 compared to $0.5 million in the second quarter of fiscal 2025. The second quarter of fiscal 2026 benefited from $0.6 million of interest income related to the receipt of tariff refunds. During the second quarter of fiscal 2026, the Company recorded an income tax provision of $6.7 million compared to $4.0 million in the second quarter of fiscal 2025 and the effective tax rate was 28.6% compared to 27.7% in the second quarter of fiscal 2025. Net Income was $16.8 million compared to $10.5 million in the second quarter of fiscal 2025. Net Income per Diluted Share was $1.11 for the second quarter of fiscal 2026 compared to $0.69 in the second quarter of fiscal 2025. Adjusted Net Income per Diluted Share* in the second quarter of fiscal 2026, which includes the benefit of net tariff refunds was $1.24 compared to $0.81 in the second quarter of fiscal 2025. Adjusted EBITDA* for the second quarter of fiscal 2026, which includes the benefit of net tariff refunds, was $32.8 million compared to $25.6 million in the second quarter of fiscal 2025. Adjusted EBITDA margin* for the second quarter of fiscal 2026, which includes the benefit of net tariff refunds, was 21.2% compared to 16.6% in the second quarter of fiscal 2025. Adjusted EBITDA for the second quarter of fiscal 2026 excluding net tariff refunds and deployment of these refunds toward strategic initiatives and elevated fuel costs during the period was $20.1 million. The Company did not open or close any stores in the second quarter of fiscal 2026. The store count at the end of the quarter is 255 stores compared to 247 stores at the end of the second quarter of fiscal 2025. For the twenty-six weeks ended August 1, 2026: Net sales for the twenty-six weeks ended August 1, 2026 decreased 2.7% to $299.3 million compared to $307.6 million for the twenty-six weeks ended August 2, 2025. Total company comparable sales, which includes comparable store and direct to consumer sales, decreased by 4.2% for the twenty-six weeks ended August 1, 2026. Direct to consumer net sales, which represented 46.4% of net sales, decreased 3.2% compared to the twenty-six weeks ended August 2, 2025. Gross profit was $217.7 million compared to $215.7 million for the twenty-six weeks ended August 2, 2025. Gross margin was 72.7% compared to 70.1% for the twenty-six weeks ended August 2, 2025. Excluding the receipt of $13.3 million of net tariff refunds in the second quarter of fiscal 2026 gross margin was 68.3%. SG&A was $184.4 million compared to $179.7 million for the twenty-six weeks ended August 2, 2025. SG&A as a percentage of total net sales was 61.6% compared to 58.4% for the twenty-six weeks ended August 2, 2025. Operating income was $33.0 million compared to $35.8 million for the twenty-six weeks ended August 2, 2025. Operating income margin for the twenty-six weeks ended August 1, 2026 was 11.0% compared to 11.7% for the twenty-six weeks ended August 2, 2025. Adjusted Income from Operations*, which includes the benefit of net tariff refunds, was $38.0 million compared to $41.2 million for the twenty-six weeks ended August 2, 2025. Interest expense was $3.8 million compared to $5.5 million for the twenty-six weeks ended August 2, 2025. Interest income was $1.5 million compared to $0.9 million for the twenty-six weeks ended August 2, 2025. The twenty-six weeks ended August 1, 2026 benefited from $0.6 million of interest income related to the receipt of tariff refunds. During the twenty-six weeks ended August 1, 2026, the Company recorded an income tax provision of $9.3 million compared to $9.0 million for the twenty-six weeks ended August 2, 2025 and the effective tax rate was 30.2% compared to 28.8% for the twenty-six weeks ended August 2, 2025. Net Income was $21.5 million compared to $22.2 million for the twenty-six weeks ended August 2, 2025. Net Income per Diluted Share was $1.43 compared to $1.45 for the twenty-six weeks ended August 2, 2025. Adjusted Net Income per Diluted Share* for the twenty-six weeks ended August 1, 2026, which includes the benefit of net tariff refunds, was $1.69 compared to $1.69 for the twenty-six weeks ended August 2, 2025. Adjusted EBITDA* for the twenty-six weeks ended August 1, 2026, which includes the benefit of net tariff refunds, was $49.5 million compared to $52.9 million for the twenty-six weeks ended August 2, 2025. Adjusted EBITDA margin* for the twenty-six weeks ended August 1, 2026, which includes the benefit of net tariff refunds, was 16.6% compared to 17.2% for the twenty-six weeks ended August 2, 2025. Adjusted EBITDA for the twenty-six weeks ended August 1, 2026, excluding net tariff refunds and the deployment of these refunds toward strategic initiatives and elevated fuel costs during the period was $36.8 million. The Company opened one store and closed two stores for the twenty-six weeks ended August 1, 2026. The store count at the end of the twenty-six weeks ended August 1, 2026 is 255 stores compared to 247 stores at the end of the twenty-six weeks ended August 2, 2025. Balance Sheet and Cash Flow Highlights Inventory at the end of the second quarter of fiscal 2026 was $52.6 million compared to $55.3 million at the end of the second quarter of fiscal 2025. Net Cash provided by Operating Activities for the thirteen weeks ended August 1, 2026, was $46.3 million compared to $19.4 million for the thirteen weeks ended August 2, 2025. Net Cash provided by Operating Activities for the twenty-six weeks ended August 1, 2026, was $48.0 million compared to $24.7 million for the twenty-six weeks ended August 2, 2025. Net Cash provided by Operating Activities in both the thirteen and twenty-six weeks benefited from $19.0 million of gross tariff refunds including associated interest income. Free Cash Flow* for the thirteen weeks ended August 1, 2026, was $44.0 million compared to $16.6 million for the thirteen weeks ended August 2, 2025. Free Cash Flow* for the twenty-six weeks ended August 1, 2026 was $42.9 million compared to $19.2 million for the twenty-six weeks ended August 2, 2025. The Company ended the second quarter of fiscal 2026 with a cash balance of $76.9 million. *Non-GAAP financial measures. Please see "Non-GAAP Financial Measures" and "Reconciliation of GAAP Net Income to Adjusted EBITDA," "Reconciliation of GAAP Operating Income to Adjusted Income from Operations," "Reconciliation of GAAP Net Income to Adjusted Net Income," and "Reconciliation of GAAP Cash from Operations to Free Cash Flow" for more information. Share Repurchase Authorization During the thirteen and twenty-six weeks ended August 1, 2026, the Company repurchased 99,902 and 168,402 shares of its common stock for an aggregate purchase price of $1.5 million and $2.3 million, respectively. As of August 1, 2026, the Company had $11.8 million remaining under its currently authorized $25.0 million share repurchase program, which expires December 6, 2026. The share repurchase program is expected to be funded through the Company’s existing cash and future free cash flow. The timing of any repurchases and the number of shares repurchased are subject to the discretion of the Company and may be affected by various factors, including general market and economic conditions, the market price of the Company’s common stock, the Company’s earnings, financial condition, capital requirements and levels of indebtedness, legal requirements, and other factors that management may deem relevant. The share repurchase program authorization does not obligate the Company to acquire any shares of its common stock and may be amended, suspended or discontinued at any time. Shares may be repurchased from time to time through open market transactions, block trades, privately negotiated purchase transactions or other purchase techniques and may include purchases effected pursuant to one or more trading plans established pursuant to Rule 10b5-1 under the Securities Exchange Act of 1934. Quarterly Dividend Payment On June 3, 2026 the Board declared a quarterly cash dividend of $0.09 per share, payable on July 8, 2026 to stockholders of record of issued and outstanding shares of the Company’s common stock as of June 24, 2026. Following the end of the second quarter of fiscal 2026, on September 2, 2026, the Board declared a cash dividend of $0.09 per share, payable on October 7, 2026 to stockholders of record of issued and outstanding shares of the Company’s common stock as of September 23, 2026. Outlook The Company is providing its outlook for the third quarter of fiscal 2026 and raising its outlook for the full year fiscal 2026. The following outlook includes net tariff refunds as well as the deployment of these refunds toward investments primarily focused on marketing to build the brand and accelerate file growth, which will be relatively evenly split between the third and fourth quarters. The following outlook also assumes an average 10% to 12.5% tariff rate for the remainder of fiscal 2026 which results in approximately $1.0 million of favorability in the second half of the year compared to prior assumptions. For the third quarter of fiscal 2026, the Company expects the following: Net Sales to be up 3% to 5% compared to fiscal 2025 Comparable Sales to be up 1% to up 3% compared to fiscal 2025 Gross margin to be about flat compared to fiscal 2025 Adjusted EBITDA of $20.0 million to $22.0 million For the full year of fiscal 2026, the Company expects the following: Net Sales to be flat to up 2% compared to fiscal 2025 Comparable Sales to be down 1% to up 1% compared to fiscal 2025 Gross margin to be up 100 basis points to 150 basis points Adjusted EBITDA to be $75 million to $80 million Free cash flow to be approximately $40 million Total capital expenditures of approximately $20 million to $25 million Net new store growth of approximately 1 to 3 new stores Conference Call Information A conference call to discuss second quarter 2026 results is scheduled for today, September 9, 2026, at 8:00 a.m. Eastern Time. Those interested in participating in the call are invited to dial (833) 461-5787 or (585) 542-9983 if calling internationally. Please dial in approximately 10 minutes prior to the start of the call and reference Conference ID 572594243 when prompted. A live audio webcast of the conference call will be available online at http://investors.jjill.com/Investors-Relations/News-Events/events. A taped replay of the conference call will be available approximately two hours following the call and can be accessed both online and by dialing (833) 309-1852 or (929) 828-5978. The pin number to access the telephone replay is 572594243. The telephone replay will be available until September 16, 2026. About J.Jill, Inc. J.Jill is a national lifestyle brand that provides apparel, footwear and accessories designed to help its customers move through a full life with ease. The brand represents an easy, thoughtful and inspired style that celebrates the totality of all women and designs its products with its core brand ethos in mind: keep it simple and make it matter. J.Jill offers a high touch customer experience through about 250 stores nationwide and a robust ecommerce platform. J.Jill is headquartered outside Boston. For more information, please visit www.jjill.com or http://investors.jjill.com. The information included on our websites is not incorporated by reference herein. Non-GAAP Financial Measures To supplement our unaudited condensed consolidated financial statements presented in accordance with generally accepted accounting principles ("GAAP"), we use the following non-GAAP measures of financial performance: Adjusted EBITDA, which represents net income plus (less) depreciation and amortization, income tax provision, interest expense, interest income, equity-based compensation expense, write-off of property and equipment, amortization of cloud-based software implementation costs, adjustment for exited retail stores, impairment of long-lived assets, loss on extinguishment of debt, and other non-recurring items, primarily consisting of non-ordinary course professional fees, non-employee share-based payments, CEO transition costs, severance expense, and legal settlements and fees associated with certain non-recurring transactions and events. We present Adjusted EBITDA on a consolidated basis because management uses it as a supplemental measure in assessing our operating performance, and we believe that it is helpful to investors, securities analysts and other interested parties as a measure of our comparative operating performance from period to period. We also use Adjusted EBITDA as one of the primary methods for planning and forecasting overall expected performance of our business and for evaluating on a quarterly and annual basis actual results against such expectations. Further, we recognize Adjusted EBITDA as a commonly used measure in determining business value and as such, use it internally to report results. We also use Adjusted EBITDA margin which represents, for any period, Adjusted EBITDA as a percentage of net sales. Adjusted Income from Operations, which represents operating income plus (less) equity-based compensation expense, write-off of property and equipment, adjustment for exited retail stores, impairment of long-lived assets, and other non-recurring items. We present Adjusted Income from Operations because management uses it as a supplemental measure in assessing our operating performance, and we believe that it is helpful to investors, securities analysts, and other interested parties as a measure of our comparative operating performance from period to period. Adjusted Net Income, which represents net income plus income tax provision, equity-based compensation expense, write-off of property and equipment, adjustment for exited retail stores, impairment of long-lived assets, and other non-recurring items. We present Adjusted Net Income because management uses it as a supplemental measure in assessing our operating performance, and we believe that it is helpful to investors, securities analysts and other interested parties as a measure of our comparative operating performance from period to period. Adjusted Net Income per Diluted Share represents Adjusted Net Income divided by the number of fully diluted shares outstanding. Adjusted Net Income per Diluted Share is presented as a supplemental measure in assessing our operating performance, and we believe that it is helpful to investors, securities analysts and other interested parties as a measure of our comparative operating performance from period to period. Free Cash Flow represents cash flow from operations less capital expenditures. Free Cash Flow is presented as a supplemental measure in assessing our liquidity, and we believe that it is helpful to investors, securities analysts and other interested parties as a measure of our comparative liquidity and operating performance from period to period. While we believe that Adjusted EBITDA, Adjusted EBITDA margin, Adjusted Income from Operations, Adjusted Net Income, Adjusted Diluted EPS and Free Cash Flow are useful in evaluating our business, they are non-GAAP financial measures that have limitations as analytical tools. These non-GAAP measures should not be considered alternatives to, or substitutes for, Net Income, Income from Operations, Net Income per Diluted Share or Cash from Operations, which are calculated in accordance with GAAP. In addition, other companies, including companies in our industry, may calculate these non-GAAP measures differently or not at all, which reduces the usefulness of such non-GAAP financial measures as tools for comparison. We recommend that you review the reconciliation and calculation of Adjusted EBITDA, Adjusted EBITDA margin, Adjusted Income from Operations, Adjusted Net Income, Adjusted Diluted EPS and Free Cash Flow to Net Income, Income from Operations, Net Income per Diluted Share and Cash from Operations, respectively, the most directly comparable GAAP financial measures, under "Reconciliation of GAAP Net Income to Adjusted EBITDA", "Reconciliation of GAAP Operating Income to Adjusted Income from Operations", "Reconciliation of GAAP Net Income to Adjusted Net Income" and "Reconciliation of GAAP Cash from Operations to Free Cash Flow" and not rely solely on Adjusted EBITDA, Adjusted EBITDA margin, Adjusted Income from Operations, Adjusted Net Income, Adjusted Net Income per Diluted Share, Free Cash Flow or any single financial measure to evaluate our business. Forward-Looking Statements This press release contains, and oral statements made from time to time by our representatives may contain, "forward-looking statements." All statements other than statements of historical facts contained in this press release, including statements regarding our strategy, future operations, future financial position, future revenue, projected costs, prospects, plans, objectives of management, expected market growth and any activities, events or developments that we intend, expect or believe may occur in the future are forward-looking statements. Such statements are often identified by words such as "could," "may," "might," "will," "likely," "anticipates," "intends," "plans," "seeks," "believes," "estimates," "expects," "continues," "ongoing," "remain," "projects," "goal," "target" (although not all forward-looking statements contain these identifying words) and similar references to future periods, or by the inclusion of forecasts or projections. Forward-looking statements are based on our current expectations and assumptions regarding capital market conditions, our business, the economy and other future conditions and are not guarantees of future performance. Because forward-looking statements relate to the future, by their nature, they are inherently subject to a number of risks, uncertainties, potentially inaccurate assumptions and changes in circumstances that are difficult to predict. As a result, our actual results may differ materially from those contemplated by the forward-looking statements. Important factors that could cause actual results to differ materially from those in any forward-looking statements include regional, national or global political, economic, business, competitive, market and regulatory conditions, including risks regarding: (1) our sensitivity to changes in economic conditions and discretionary consumer spending; (2) the material adverse impact of pandemics, other health crises or natural disasters on our operations, business and financial results; (3) our ability to anticipate and respond to changing customer preferences, shifts in fashion and industry trends in a timely manner; (4) our ability to maintain our brand image, engage new and existing customers and gain market share; (5) the impact of operating in a highly competitive industry with increased competition; (6) our ability to successfully optimize our omnichannel operations, including our ability to enhance our marketing efforts and successfully realize the benefits from our investments in new technology, for example our new predictive AI-powered inventory forecasting model and other AI tools, our upgraded point-of-sale system and recently implemented order management system; (7) our ability to use effective marketing strategies and increase existing and new customer traffic; (8) any interruptions in our foreign sourcing operations and the relationships with our suppliers and agents; (9) any increases in the demand for, or the price of, raw materials used to manufacture our merchandise and other fluctuations in sourcing and distribution costs; (10) any material damage or interruptions to our information systems; (11) our ability to protect our trademarks and other intellectual property rights; (12) our indebtedness restricting our operational and financial flexibility; (13) our ability to manage our inventory levels, size assortments and merchandise mix; (14) the fact that we are no longer a controlled company; (15) the impact of any new or increased tariffs; (16) our management succession plan; and (17) other factors that may be described in our filings with the Securities and Exchange Commission (the "SEC"), including the factors set forth under "Risk Factors" in our Annual Report on Form 10-K for the fiscal year ended January 31, 2026. You are encouraged to read our filings with the SEC, available at www.sec.gov, for a discussion of these and other risks and uncertainties. We caution investors, potential investors and others not to place considerable reliance on the forward-looking statements in this press release and in the oral statements made by our representatives. Any such forward-looking statement speaks only as of the date on which it is made. J.Jill undertakes no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future developments or otherwise. (Tables Follow) Summary Data from the Statement of Cash Flows The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported within the consolidated balance sheets that sum to the total of the same such amounts shown in the consolidated statements of cash flows: Reconciliation of GAAP Cash from Operations to Free Cash Flow View source version on businesswire.com: https://www.businesswire.com/news/home/20260909078190/en/ Contacts Investor Relations: Caitlin ChurchillICR, [email protected] 203-682-8200Business and Financial Media: Michael McMullan / Danielle Poggi Berns Communications Group [email protected] / [email protected]

Our analysts just identified a stock with the potential to be the next Nvidia. Tell us how you invest and we'll show you why it's our #1 pick. Tap here. Performance exceeded expectations driven by a meaningful improvement in full-price selling trends across both physical stores and direct channels. The customer file is stabilizing as new-to-brand acquisition accelerates, specifically attracting a younger demographic with higher average order values. Management is consolidating the Wearever sub-brand into the core assortment to simplify the portfolio and reallocate resources toward high-growth categories like Luxe Lounge and denim. Operational improvements in the direct channel focused on richer item-level storytelling and enhanced fit information to drive conversion. Marketing strategy is shifting from capturing existing demand to active demand generation, rebalancing the mix toward prospective and reactive customers. Product execution is being refined based on customer feedback, specifically addressing a previous lack of color and print breadth in the tops and dresses categories. Management is deploying the majority of tariff refunds into second-half marketing and technology initiatives to build a foundation for 2027 growth. A new AI-enabled merchandise planning and allocation system is scheduled to launch later this year to support full-price selling and inventory efficiency. Guidance for the second half assumes gradual sequential improvement in product assortments as course-corrections in color and silhouette reach the market. The company expects to open 1 to 3 net new stores in 2026, a slight reduction from prior targets due to landlord delivery delays pushing some openings to 2027. Financial projections assume tariff rates will land between 10% and 12.5% for goods arriving in the second half of the year. The company received $13.3 million in net tariff refunds during the quarter, which are being strategically reinvested rather than fully flowed to the bottom line. Emerging cost pressures from fuel surcharges on shipping are being partially offset by the tariff refund windfall. Inventory levels decreased 5% year-over-year, which management views as a healthy position as they anniversary prior-year tariff impacts. Management noted the upcoming holiday season will be exceptionally promotional, though they aim to leverage full-price momentum to limit dramatic discounting. One stock. Nvidia-level potential. 30M+ investors trust Moby to find it first. Get the pick. Tap here. Investment is being directed toward top and middle-funnel awareness to drive long-term demand generation rather than just immediate conversion. Management views these expenditures as a 'down payment' on the customer file to ensure sustainable growth in 2027 and beyond. The incoming customer is younger, spending more per transaction, and showing higher retention rates than historical new acquisitions. Personalization and segmentation efforts are being prioritized to manage the distinct journeys of new, existing, and reactivated customers. Denim has evolved from a 'one-note' slim silhouette offering to a fashion-forward category featuring wide-leg and barrel shapes. The expansion allows denim to serve more aspects of the customer's lifestyle beyond casual wear, increasing its overall importance to the brand. Management admitted to being too neutral in previous quarters and is aggressively adding color and print extensions to the fall and holiday assortments. The company expects to be back in an 'ideal position' regarding product balance by the first quarter of 2027.

J.Jill (JILL) came out with quarterly earnings of $1.24 per share, beating the Zacks Consensus Estimate of $0.59 per share. This compares to earnings of $0.81 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of +110.17%. A quarter ago, it was expected that this retailer of women's clothes, shoes and accessories would post earnings of $0.44 per share when it actually produced earnings of $0.45, delivering a surprise of +2.27%. Over the last four quarters, the company has surpassed consensus EPS estimates four times. J.Jill, which belongs to the Zacks Retail - Apparel and Shoes industry, posted revenues of $154.83 million for the quarter ended July 2026, surpassing the Zacks Consensus Estimate by 2.67%. This compares to year-ago revenues of $153.99 million. The company has topped consensus revenue estimates four times over the last four quarters. The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call. J.Jill shares have added about 44.6% since the beginning of the year versus the S&P 500's gain of 12.1%. While J.Jill has outperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock? There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately. Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions. Ahead of this earnings release, the estimate revisions trend for J.Jill was mixed. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #3 (Hold) for the stock. So, the shares are expected to perform in line with the market in the near future. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. It will be interesting to see how estimates for the coming quarters and the current fiscal year change in the days ahead. The current consensus EPS estimate is $0.88 on $152.55 million in revenues for the coming quarter and $2.04 on $590.4 million in revenues for the current fiscal year. Investors should be mindful of the fact that the outlook for the industry can have a material impact on the performance of the stock as well. In terms of the Zacks Industry Rank, Retail - Apparel and Shoes is currently in the top 30% of the 250 plus Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1. One other stock from the same industry, Levi Strauss (LEVI), is yet to report results for the quarter ended August 2026. This jeans maker is expected to post quarterly earnings of $0.36 per share in its upcoming report, which represents a year-over-year change of +5.9%. The consensus EPS estimate for the quarter has remained unchanged over the last 30 days. Levi Strauss' revenues are expected to be $1.61 billion, up 4.5% from the year-ago quarter. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report J.Jill, Inc. (JILL) : Free Stock Analysis Report Levi Strauss & Co. (LEVI) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Our analysts just identified a stock with the potential to be the next Nvidia. Tell us how you invest and we'll show you why it's our #1 pick. Tap here. Performance improvement was driven by a meaningful recovery in the full-price business across both physical stores and direct channels, signaling successful product resonance. Management is consolidating the 'Wearever' sub-brand into the core assortment to simplify the portfolio and reallocate resources toward high-growth categories like Luxe Lounge and denim. The denim relaunch serves as a strategic proof point for modernizing the brand, successfully introducing fashion-forward silhouettes like wide-leg and barrel shapes to a loyal customer base. Customer file stabilization is being achieved through a dual focus on accelerating new-to-brand acquisition and successfully reactivating lapsed customers. Operational efficiencies are being targeted through the implementation of AI-enabled merchandise planning and allocation systems designed to support full-price selling and inventory precision. Assortment gaps identified in early 2026, specifically a lack of color and print breadth, are being addressed with course-corrected inventories arriving in the fall and holiday seasons. Management is deliberately deploying the majority of one-time tariff refunds into strategic marketing and technology initiatives to build a foundation for 2027 growth. Marketing spend is being rebalanced toward top and middle-funnel activities to drive broader brand awareness and demand generation among prospective customers. The updated full-year outlook assumes a sequential improvement in trends, supported by the launch of new personalization technologies and digital platform enhancements. Guidance for the second half of 2026 incorporates estimated tariff rates of 10% to 12.5% for landed goods, reflecting current regulatory expectations. Capital allocation remains focused on store projects and technology infrastructure, with two store openings delayed into early 2027 due to landlord delivery issues. The company received $13.3 million in net tariff refunds during Q2, which significantly impacted reported gross margin and EBITDA metrics. Approximately $600,000 of the refund benefit was immediately absorbed by strategic investments and emerging cost pressures from shipping fuel surcharges. Inventory levels ended the quarter down 5% year-over-year, which management views as a healthy position as they anniversary prior-year incremental tariff expenses. Management flagged that while momentum is strong, the company is still in the early stages of a multi-year strategic evolution and learning cycle. One stock. Nvidia-level potential. 30M+ investors trust Moby to find it first. Get the pick. Tap here. Marketing investments are shifting from purely capturing existing demand to driving awareness and consideration that will impact 2027 and beyond. The company is utilizing new leadership to sharpen messaging and implement sophisticated segmentation strategies within owned channels. The incoming new-to-brand customer is younger, has a higher average order value, and is retaining at a higher rate than historical cohorts. Management is focusing on personalization and digital experience to maintain engagement with this evolving demographic without alienating the loyal base. Bottoms have stabilized as the brand successfully transitioned from basic slim silhouettes to fashion-forward leg shapes like wide-leg denim. Management admitted to being 'too neutral' in early 2026 and has aggressively added color and prints back into the Q3 and Q4 assortments to meet customer demand. The company aims to leverage full-price momentum to limit the depth of promotions during the traditionally heavy discount holiday period. Teams are utilizing 'read and react' capabilities to chase into best-selling items, particularly in accessories and outerwear.

Interested in J.Jill, Inc.? Here are five stocks we like better. Second-quarter results improved: Sales rose 0.5% to $154.8 million, while adjusted EPS increased to $1.24 from $0.81. Reported profitability benefited from $13.3 million in net tariff refunds, with underlying gross margin roughly flat year over year. J.Jill is reinvesting for future growth: The company plans to direct most tariff-refund proceeds toward marketing, customer acquisition, technology and personalization initiatives. Product changes in denim, color, prints and collections such as Luxe Lounge are also beginning to gain traction. Full-year guidance was raised: Management now expects sales to be flat to up 2%, comparable sales ranging from down 1% to up 1%, and adjusted EBITDA of $75 million to $80 million. The company also expects approximately $40 million in free cash flow and plans to continue share repurchases and its $0.09 quarterly dividend. J. Jill, Inc Is Not Ready To Rally Back Up The Hill J.Jill (NYSE:JILL) reported second-quarter sales growth and higher profitability, citing improved full-price selling, stronger customer acquisition and progress in its product assortment. The company also raised its full-year outlook while saying it plans to reinvest most net tariff refunds into marketing and technology initiatives intended to support growth into 2027. “Our second quarter results indicate a meaningful step forward and reflect the progress we are making across each of our three strategic priorities: evolving the product assortment, enhancing the customer journey, and advancing the way we work,” CEO and President Mary Ellen Coyne said on the company’s earnings call. → 3 Under-the-Radar Defense Stocks With Record Backlogs J. Jill Climbs Up The Hill On Wider Margins Total second-quarter sales rose 0.5% from a year earlier to $154.8 million, while comparable sales also increased 0.5%. Direct sales, representing approximately 47% of quarterly revenue, increased 1.9%, driven by higher markdown sales. Store sales declined 0.7%, as stronger full-price sales were more than offset by lower markdown sales in stores. Gross profit totaled about $119 million and gross margin reached 76.8%, up approximately 840 basis points from the prior-year period. The figures included $13.3 million in net tariff refunds received during the quarter. → Ride-Share Reckoning: Tesla Drives Into Uber's Lane J. Jill Reports Q2 Results, Issues No Guidance, Citing Ongoing Challenges Excluding those refunds, gross profit was $105.7 million and gross margin was 68.3%, roughly flat from the prior year. Chief Financial Officer and Chief Operating Officer Mark Webb said a higher full-price gross-margin rate offset a greater mix of markdown sales. Reported adjusted EBITDA was $32.8 million, compared with $25.6 million in the second quarter of fiscal 2025. Excluding tariff refunds and approximately $600,000 of related strategic investments and costs, underlying adjusted EBITDA was $20.1 million, according to the company. → High Gas Prices Aren't Budging—Here Are 3 Stocks That Benefit Adjusted diluted earnings per share were $1.24, compared with $0.81 a year earlier. Interest expense declined to $1.9 million from $2.7 million. J.Jill generated approximately $46 million of cash from operations during the quarter, including about $19 million related to gross tariff refunds. Excluding the refund impact, cash from operations was approximately $27 million and free cash flow was about $25 million. The company ended the quarter with approximately $77 million in cash and $72 million in funded debt. Coyne said the company’s customer file improved from the start of the year and is beginning to stabilize, supported by increased new-to-brand customer acquisition and reactivation of lapsed customers. She said newer customers are slightly younger, are retaining at a higher rate and are spending more than new customers had historically. The company attributed some of the improvement to marketing changes, including more refined messaging, customer segmentation and increased activity across channels. J.Jill said its SMS subscriber file continued to grow, while its catalog business improved profitability through a more focused circulation base. The company is also working to integrate its credit-card and loyalty-program information into a more unified customer view. Coyne said J.Jill is shifting a greater portion of its marketing investment toward prospective and reactivated customers, rather than primarily focusing spending on existing customers. J.Jill plans to use the majority of tariff-refund proceeds to fund second-half marketing investments, particularly in upper- and middle-funnel initiatives designed to expand awareness and generate demand. Webb said those investments are intended to support some second-half sales growth but are principally “a down payment on the file” and on performance in 2027 and beyond. The company said outerwear and accessories were among its stronger categories during the quarter. Coyne also pointed to early results from the Luxe Lounge collection and a relaunch of the denim assortment. J.Jill said it is expanding its denim offering beyond its historical slim silhouettes by retaining trusted fits while adding new leg shapes. Coyne cited wide-leg denim and barrel silhouettes as areas receiving customer response. The company also said its bottoms category stabilized in the second quarter, with strength in core products as well as newer silhouettes. Management said customer feedback indicated a need for more color, prints and assortment breadth. J.Jill has added color and print to top and dress programs for the third and fourth quarters, following what Coyne described as an overly neutral assortment earlier in the year. The retailer is also consolidating best-selling Wearever items into its core assortment. Coyne said the move is intended to simplify the product lineup and reallocate investment to categories such as Luxe Lounge, travel capsules and denim. Pure Jill remains a priority within the company’s sub-brand portfolio. J.Jill is investing in an AI-enabled merchandise planning and allocation system that is expected to begin launching later this year. The company is also advancing digital-platform and personalization investments, with some technology projects being accelerated into fiscal 2026 using tariff-refund proceeds. For the third quarter, J.Jill expects sales to increase 3% to 5%, comparable sales to rise 1% to 3%, and adjusted EBITDA to range from $20 million to $22 million. The company expects gross margin to be approximately flat from the prior-year quarter. Management now estimates tariff rates on goods landed in the second half will range from 10% to 12.5%. Second-half tariff costs at current rates are expected to be about $1 million lower than the company’s previous expectation and lower than the prior year beginning in the fourth quarter. Full-year adjusted EBITDA: $75 million to $80 million Full-year sales growth: Flat to up 2% from the prior year Comparable sales: Down 1% to up 1% Gross-margin change: Up 100 to 150 basis points, partly reflecting tariff refunds Capital expenditures: $20 million to $25 million Free cash flow: Approximately $40 million J.Jill expects to open one to three net new stores during the year, including two planned for the third quarter. The company reduced its store-opening outlook because landlord delivery delays are expected to push two planned openings into early 2027. J.Jill ended the second quarter with 255 stores, compared with 247 stores a year earlier. The company repurchased approximately 100,000 shares for $1.5 million during the quarter, bringing year-to-date repurchases to 168,000 shares for $2.3 million. About $11.8 million remained under its $25 million repurchase authorization at quarter-end. J.Jill also said its board approved a quarterly dividend of $0.09 per share, payable Oct. 7 to shareholders of record as of Sept. 23. J.Jill is a women's apparel retailer specializing in modern, versatile clothing and accessories. The company designs and markets a range of products that emphasize comfort and style, including knitwear, woven tops, pants, dresses, outerwear, jewelry, and footwear. Through its in-house design team, J.Jill focuses on creating seasonal collections that appeal to women seeking effortless, mix-and-match wardrobes. Products are sold through a multi-channel distribution network comprising company-operated boutiques, e-commerce platforms, and catalog sales. This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected]. The article "J.Jill Q2 Earnings Call Highlights" was originally published by MarketBeat. View MarketBeat's top stocks for September 2026.

This article first appeared on GuruFocus. Net Sales: $154.8 million, up 0.5% compared to Q2 2025. Comparable Sales: Up 0.5% for the quarter. Store Sales: Down 0.7% year-over-year. Direct Sales: Up 1.9% year-over-year, representing about 47% of total sales. Gross Profit: Approximately $119 million, including net tariff refunds; $105.7 million excluding refunds. Gross Margin: 76.8% including net tariff refunds; 68.3% excluding refunds, about flat versus last year. SG&A Expenses: Approximately $94.6 million, up from $88.6 million last year. Adjusted EBITDA: $32.8 million reported; $20.1 million excluding tariff refunds and strategic investments. Adjusted Net Income per Diluted Share: $1.24, compared to $0.81 last year. Cash from Operations: About $46 million, including $19 million in gross tariff refunds; approximately $27 million excluding refunds. Free Cash Flow: Approximately $25 million in the quarter. Inventory: Down about 5% compared to the end of Q2 last year. Store Count: 255 stores at quarter end, compared to 247 stores at the end of Q2 last year. Capital Expenditures: About $2 million for the quarter. Share Repurchases: Repurchased about 100,000 shares for approximately $1.5 million in Q2. Warning! GuruFocus has detected 8 Warning Sign with JILL. Is JILL fairly valued? Test your thesis with our free DCF calculator. Release Date: September 09, 2026 For the complete transcript of the earnings call, please refer to the full earnings call transcript. J.Jill Inc (NYSE:JILL) delivered second-quarter results that exceeded expectations, with net sales up 0.5% and a significant sequential improvement in trend from the first quarter. The company saw meaningful strength in key categories like outerwear, accessories, Luxe Lounge, and the relaunched denim assortment, with denim generating nearly 1 million impressions in the first three days of its influencer campaign. Customer file is stabilizing, with accelerating new-to-brand acquisition, a younger incoming customer profile, and higher spending from new customers, supported by improved marketing returns and SMS growth. J.Jill Inc (NYSE:JILL) received $13.3 million in net tariff refunds, which it is strategically investing in marketing and technology initiatives to drive long-term growth and position for a more productive 2027. The company raised its full-year guidance, expecting adjusted EBITDA of $75-$80 million and sales flat to up 2%, with momentum carrying into the third quarter. Gross margin improved significantly in Q2, up 840 basis points to 76.8% including tariff refunds, and the company expects full-year gross margin to be up 100-150 basis points. Inventory is in good shape, down 5% year-over-year, and the company is leveraging AI-enabled tools to improve planning and allocation, with a new system launching later this year. J.Jill Inc (NYSE:JILL) is still in the early stages of its evolution, with management acknowledging that product assortment issues, such as a lack of color and print in tops and dresses, led to misses in Q1 that were too soon to fully correct in Q2. Store sales declined 0.7% in Q2, as strength in full-price sales was more than offset by a decline in markdown selling in stores. The company faces emerging cost pressures, including fuel surcharges on shipping, which are partially offsetting the benefits of tariff refunds. SG&A expenses increased to $94.6 million from $88.6 million last year, driven by higher store expenses, occupancy costs, marketing investments, and management incentive accruals. The company reduced its full-year store opening guidance to one to three net new stores due to landlord delivery delays, pushing two openings into early 2027. Direct channel sales growth was driven by higher markdown sales, indicating a reliance on promotional activity in that channel, despite improvements in full-price selling. The company's full-year comp sales guidance remains modest, at down 1% to up 1%, reflecting ongoing challenges in achieving consistent growth. Q: How is J.Jill deploying the tariff refunds, and what is the expected impact on the second half of 2026 and beyond?A: Mark Webb (CFO & COO): The company made a deliberate decision to invest the majority of the net tariff refunds into strategic initiatives, primarily marketing, to build the brand and accelerate customer file growth. This investment is expected to be fairly evenly split between Q3 and Q4, with a larger impact on Q4's EBITDA given its relative size. The investments are seen as a "down payment" on the customer file and on delivering growth in 2027 and beyond, focusing on upper and mid-funnel awareness. The guidance also accounts for emerging cost pressures, such as fuel surcharges on shipping. Q: Can you elaborate on the profile of the new-to-brand customer and the performance of the bottoms category, particularly denim?A: Mary Ellen Coyne (CEO & President): The new-to-brand customer is younger than the existing base, is retaining at a higher rate, and is spending more, driven by higher average order value and more trips. The reactivation customer is also showing similar positive metrics. Regarding bottoms, the category stabilized in Q2, with success in core items and new leg shapes. The denim relaunch has been a standout, with customers responding well to new silhouettes like wide-leg and barrel styles, expanding the category's end-use beyond casual wear. Q: What were the key drivers of the Q2 results, and how is the company's strategic progress reflected in the numbers?A: Mary Ellen Coyne (CEO & President): Q2 results exceeded expectations and showed significant sequential improvement from Q1. Net sales increased, supported by an improving trend in the full-price business across both stores and direct channels. The company saw positive store traffic and meaningful improvement in customer acquisition. Adjusted EBITDA was $20.1 million, excluding tariff refunds and strategic investments. The customer file is stabilizing, and new-to-brand acquisition is accelerating, which are key indicators of the progress being made on the three strategic priorities. Q: What are the key learnings from Q1 that are being applied to the product assortment for the second half, specifically regarding tops, dresses, and color?A: Mary Ellen Coyne (CEO & President): The company learned from Q1 that the assortment was too neutral and lacked balance in tops and dresses. While Q2 was too soon to fully correct this, the team has added color and print back into these categories for Q3 and Q4, which are expected to be an improvement. The company is rebalancing silhouettes and adding color extensions to top programs, with the goal of being in an "ideal position" by Q1 of 2027. Q: How is the marketing strategy evolving, and what is the outlook for the holiday season?A: Mary Ellen Coyne (CEO & President): The marketing strategy is shifting from a focus on existing customers to a more balanced mix that includes prospective and reactive customers. The company is investing in demand generation and awareness to drive long-term file growth. For holiday, the team is using Q1 and Q2 learnings to drive momentum in the full-price business, aiming to limit the need for heavy promotions. The company is encouraged by the ability to connect product assortments with marketing strategies, which is a key driver of confidence. Q: Can you provide more detail on the Q2 financial performance, including sales, gross margin, and EBITDA?A: Mark Webb (CFO & COO): Total company sales were $154.8 million, up 0.5%, with comparable sales up 0.5%. Store sales were down 0.7%, while direct sales were up 1.9%. Gross profit, including tariff refunds, was about $119 million, with a gross margin of 76.8%. Excluding refunds, gross margin was 68.3%, roughly flat versus last year. Adjusted EBITDA was $32.8 million, or $20.1 million excluding the tariff refunds and strategic investments. Q: What is the company's updated full-year guidance for 2026?A: Mark Webb (CFO & COO): The company now expects adjusted EBITDA in the range of $75 million to $80 million, which reflects the tariff refunds partially offset by strategic investments. Sales are expected to be flat to up 2%, with comps between down 1% and up 1%. Gross margin is expected to be up 100 to 150 basis points versus the prior year. Capital expenditures are still expected to be between $20 million and $25 million, and free cash flow is now expected to be approximately $40 million. Q: How are the new-to-brand and reactivated customers performing in terms of retention and spend, and how is the company balancing this with its loyal customer base?A: Mary Ellen Coyne (CEO & President): The new-to-brand customer is coming in younger, retaining at a higher rate, and spending more than in recent history. The reactivation of lapsed customers is also building momentum. The company is actively working on personalization and segmentation to message these different customer groups effectively, both in marketing and in the in-store and direct channel experiences. This approach is broadening the brand's appeal without disrupting the deep relationship with the highly loyal existing base. Q: What is the difference in performance between the in-store and direct channels, particularly regarding full-price selling?A: Mary Ellen Coyne (CEO & President): Both stores and the direct channel have seen significant improvement in full-price selling. While the direct channel will always be a source for selling through markdown product profitably, the company is seeing improvements in average unit retail (AUR) and average transaction value (ATV) in both channels. This momentum across the business is a key source of optimism. Q: What is the company's strategy regarding its sub-brand portfolio, and how is it evolving the product assortment?A: Mary Ellen Coyne (CEO & President): The company is consolidating the best-selling pieces of the Wearever sub-brand into the core J.Jill assortment to simplify the lineup and reallocate investment into areas with more growth potential, such as Luxe Lounge and denim. Pure Jill remains a priority. The design and merchandising teams are fully in sync, and early reads on fall assortments are encouraging, with expectations of gradual sequential improvement. For the complete transcript of the earnings call, please refer to the full earnings call transcript.