PVH

Image source: The Motley Fool. Thursday, Sept. 3, 2026 at 9:00 a.m. ET Senior Director of Investor Relations - Caitlin Howard Chief Executive Officer - Stefan Larsson Interim Chief Financial Officer and Executive Vice President Global Financial Planning and Analysis - Melissa Stone Operator: Thank you for your continued patience. Your meeting will begin shortly. If you need assistance at any time, please press 0. And a member of our team will be happy to help. Thank you for your continued patience. Your meeting will begin shortly. If you need assistance at any time, please press 0 and a member Good morning, everyone, and welcome to today's PVH Second Quarter 2020 Earnings Conference Call. Ester, you will have an opportunity to ask questions during the question and answer session. You may register to ask a question at any time by pressing the star and 1 key on your touch tone phone. Please note this call may be recorded and that I will be standing by you need any assistance. It is now my pleasure to turn today's program over to Caitlin Howard. Caitlin Howard: Senior Director of Investor Relations. Thank you, operator. Good morning, everyone, and welcome to the PVH Corp. Second Quarter 2020 Earnings Conference Call. Leading the call today will be Stefan Larsson, Chief Executive Officer and Melissa Stone, Interim Chief Financial Officer and Executive Vice President Global Financial Planning and Analysis. Alexei Rossignol, our incoming Chief Financial Officer, has joined PVH and we look forward to having him lead our third quarter 2020 earnings conference call along with Stefan. This webcast and conference call is being recorded on behalf of PVH and consists of copyrighted material. It may not be recorded, rebroadcast, or otherwise transmitted without PVH's written permission. Your participation constitutes your consent to having anything you say appear on any transcript or replay of this call. The information to be discussed includes forward looking statements that reflect PVH's view as of 09/02/2026, of future events and financial performance. These statements are subject to risks and uncertainties indicated in the company's SEC filings, and the Safe Harbor statement included in the press release that is the subject of this call. PVH does not undertake any obligation to update publicly any forward looking statement, including, without limitation, any estimates regarding revenue or earnings. Generally, the financial information and projections to be discussed will be on a non GAAP basis. As defined under SEC rules. Reconciliations to GAAP amounts are included in PVH's second quarter 2020 earnings release. Which can be found on www.pvh.com and in the company's current report on Form 8-K furnished to the SEC in connection with the release. At this time, I am pleased to turn the conference over to Stefan Larsson. Stefan Larsson: Thank you, Kate, and good morning, everyone. And thank you for joining our call today. I would like to start by acknowledging our Calvin Klein, Tommy Hilfiger and PVH teams around the world. Thanks to your hard work, we continue to make meaningful progress on our multiyear PVH plus plan. During the second quarter, we built momentum while navigating a dynamic environment, achieving our revenue guidance and beating on profitability. This morning, I am also thrilled to formally welcome our new Chief Financial Officer, Alexei Rossignol to PVH. Alexei will officially join us in New York next week. He comes to us with deep financial and operational experience, most recently as the global CFO and COO at Sephora. Where he drove disciplined growth and significant profit expansion. Alexis' experience combining consumer-facing improvements with effective financial steering will help us deliver our PVH plus plan and drive long term shareholder value. I cannot wait for you all to get to know him. Now on to a discussion of the second quarter. This morning, I am going to start with an overview of the results. Before turning to progress on our PVH plus plan and we will end with our thoughts on the remainder of the year and future opportunities. Turning to the second quarter, we delivered revenues in line with our guidance. Across all 3 regions and our licensing business. Calvin Klein and Tommy Hilfiger revenues were in line with expectations, with consistent year over year revenue performance excluding the impacts of wholesale shipment timing. We continue to drive momentum in our D2C business, led by growth in both APAC and Americas, while the wholesale business was impacted by the tough macro environment in Europe. E-commerce continued to be a source of strength, supported by strong year over year increases in online traffic across both brands. With Calvin up double digits and Tom up high-single digits. These results reflect the overall progress we are making in elevating our product marketing, and the consumer experience. We beat our guidance on all elements of profitability. Importantly, our gross margins, excluding tariff refunds improved year over year and were above expectations. We continue to lean into our strong cost discipline while remaining committed to a balanced approach to investment that prioritize brand building in support of the PVH plus plan. We ended the quarter with very good inventory levels, down 3% versus last year, and we are well positioned for fall and holiday with improved stock freshness. Turning to our performance by region. Across the regions, our performance was in line with our expectations. We drove D2C growth across The Americas and APAC, and delivered better than expected gross margin expansion across both brands. In The Americas, our business remained resilient, driven by e-commerce growth strong AUR expansion and disciplined execution. In APAC, we saw continued strength in D2C, led by stores and better than expected gross margin performance. Stronger consumer engagement drove higher conversion and AUR growth. With strength in promotion management. In EMEA, we delivered on our revenue guidance for the quarter and drove e-commerce growth across both brands. We also improved D2C versus the prior quarter. While the wholesale channel remained under pressure, reflecting the challenging environment. Turning to licensing. Which is a significant high value business for us. Generating over $350 million in annual revenue and supporting more than $3 billion in license net sales globally. Licensing is a recurring, growing strong, profitable revenue stream. Driven by long term relationships with brand building partners. We are focused on complementing our own strength in our core categories with the expertise and capabilities of our long term strategic licensing partners. During the second quarter, excluding the impact from the previously announced transition of our women's North America wholesale categories we continue to grow our go forward licensing portfolio. We expect that growth to continue through the balance of the year. Importantly, we also remain on plan with the transition of our women's wholesale business in North America, and expect it to be substantially complete by the end of 2020, and from there, we expect to grow our overall licensing business. Turning to the drivers of our Q2 performance. We are relentless in delivering on our PVH plus plan. And we continue to build momentum. While navigating a dynamic business environment. Now, let's take a moment to discuss the progress we have made across each pillar of the plan. When we connect all parts of the consumer journey, all the way to our doors and stores, we drive real commercial impact. And during the quarter, we continued to sharpen our consumer focus deliver stronger products and engage our consumers with Cut Through 360 marketing. All while improving the marketplace experience in both D2C and wholesale. Let me share some specific examples that demonstrate the meaningful progress we continue to make this quarter. Starting with building strength with the consumer. We know that both brands outperform Gen Z and younger millennials. And within those, performed strongly with the highest value consumer segments, the status shopper and the style enthusiast. We continue to focus our investments on reaching these power segments, and we are seeing early signs that it is helping us acquire and retain high quality consumers. Who shop more often are less price sensitive, and are more loyal. And we see this in our acquisition of online consumers. Which is up significantly across both brands. We see it in the performance in The Americas and APAC, where we are driving D2C growth with higher pricing power. And we see it in our growing number of returning consumers at both Calvin and Tom. Next is product. During the quarter, once again, we grew multiple hero categories in D2C. Where we have the biggest right to win, specifically in Calvin Klein denim, global sales rose double digits, across both men's and women's, with women's jeans a particular standout as consumers responded really well to our new take on Calvin Icons. led to very strong gross margins and AURs up double digits. And in Calvin Klein underwear, we drove low-single-digit global growth for the total category, with mid-single AUR improvement. And at Tommy D2C growth was driven by sweaters, which were up double digits, and shirts and polos, which were both up mid-single-digits, with linen a particular standout across categories, rising over 30% across all regions. Third, we continue to drive strong consumer engagement, increasingly connecting all the parts of the consumer journey end to end. As previously discussed, we strategically increased our marketing spend in the first half of the year. And this investment together with a sharper focus on our target consumer segments, delivered low-single-digit e-commerce growth across both Calvin and Tom, with improvements in share of online search. In Calvin Klein, the standout moment this quarter was Jung Kook for Calvin Klein. it is Jung Kook's first product collaboration with us, and our most successful global product collaboration in the history of the brand. Jung Kook is a global phenomenon with a unique ability to connect with fans across regions and demographics. By linking the campaign's product, marketing, and immersive retail activations globally, our teams created a true cultural moment that drove 5 billion in social media reach triple digit growth in e-commerce traffic compared to the Spring brand campaign, and over 90% global sell through. This collaboration is such a powerful example of how we can successfully deliver 360 global brand activations. In Tommy, through our global partnership with Liverpool Football Club, we invited consumers into an iconic summer of soccer and style. Together with Cadillac Formula 1 US sale GP and our other partnerships, we continue to connect our iconic brand and products to growing influential sport and entertainment platforms. Leveraging 120 refurbishments and relocations and over 130 new store openings year to date. Looking at recent performance across regions and brands, and I like where we are positioned, There is still more work to be done, but we are making good progress. I am optimistic that we will build on this momentum as we continue to thoughtfully execute the PVH plus plan. This morning, I would also like to share an update on our cost management actions. We have extended beyond our traditional 1 time programmatic cost actions to focus on more systematic, repeatable ways to become more efficient. We are embedding a culture of cost discipline in 2 main ways. First, we have globalized and centralized our indirect procurement capabilities to optimize spend by consolidating our indirect supplier base, standardizing our ways of working, and operating as 1 global team to leverage the full PVH scale across key areas, including global freight costs, packaging, parcel sourcing, marketing Second, we are now driving enterprise wide cost management by spend category. With senior leaders responsible for optimizing how we use our resources more effectively and more efficiently against our PVH plus priorities. Through these efforts, we are reducing cost across nearly a dozen categories and have already confirmed annualized run rate savings of approximately $45 million with a portion of these savings in 2026 and a full realization in 2027. This is important work, and we are committed to finding next level sustainable cost savings. it is 1 of the many areas along with his global brand building expertise, where Alexis' experience is highly relevant. And identifying further cost opportunities will be a key priority in the upcoming months. While cost savings are a top priority, it does not come at the expense of our brand building efforts to further strengthen our products, consumer engagement and marketplace presence. Just last week, Calvin Klein launched a new denim campaign featuring Grammy nominated pop sensation, Tate McRae. it is a great example of how we are connecting the iconic Calvin brand to a new generation of consumers all over the world. The consumer reaction has been incredible. Creating another major cultural and viral moment for Calvin and driving 28 million views across Instagram and TikTok in just the first week, with strong resonance among Gen Z audiences. We quickly followed this week with a new consumer moment featuring Tony Award nominated actor Sadie Sink, the star of 2 of the biggest entertainment phenomena of the recent years, Stranger Things and Spider Man. Both campaigns are built around our new field of fit denim platform. Where we connect Calvin's authority in denim and fit with the individual style of some of today's most relevant talent. We are supporting the campaign with a full 360 activation, bringing together the power of the brand the relevance of the talent, and the strength in product all the way through to our doors and stores. And coming this fall, we have the strongest lineup of Calvin talent yet. Leveraging the momentum Calvin has created with global stars like Dakota Johnson, Bad Bunny, and Jung Kook. We are also continuing to build out the expression of the Calvin brand in even more immersive and aspirational ways. We have recently upgraded the underwear shopping experience in approximately 100 of our stores and we will do the same with a new in store denim concept beginning this fall. For Tommy, we continue to lean into the brand's classic American cool DNA. This fall, we have our first campaign with football superstar Travis Kelce. Travis is our newest global brand ambassador, and creative collaborator. And his style, energy, enthusiasm are a great representation of the brand. The campaign is set at the Plaza Hotel in New York City, where Travis is joined by an incredible group of mega talent across fashion, music, and sport. Including Gigi David, Jisoo, Carmelo Anthony, they all bring Tommy's take on PrEP to life in a way that is fresh and relevant. The early consumer response has been really positive, and we are excited to see the campaign impact continue to build in the coming weeks. Also in Tommy, the campaign puts key growth categories front and center. Including cable knit sweaters, shirts, and transitional outerwear. As we continue to focus on expanding the strength of our products to bigger parts of the assortment. The Travis campaign complements the recently launched Always Denim campaign, featuring Romeo Beckham, It supports Tommy's accelerated focus on the denim category and the campaign drove a roughly 30% increase in North America and Europe D2C jean sales in the first month following its July launch. Again, reinforcing how our category focused approach is translating into measurable commercial results. In the marketplace, are continuing to step up Tom's consumer experience both online and in stores, with pilot openings of the new Tommy Hilfiger shop-in-shop concept in major cities around the world. Finally, next week, both Calvin and Tom will be presenting at New York Fashion Week. it is another powerful expression of how each brand is bringing its iconic DNA to life in ways that are highly relevant to today's global consumer and culture. Turning to our forward looking guidance. The fall product season is off to a positive start across both brands and all regions. Looking ahead, we are pleased to reaffirm the full year guidance that we shared last quarter. From a regional perspective, we continue to expect growth in both The Americas and APAC for the full year, with continued strength in e-commerce across all our 3 regions. And in EMEA, we expect continued momentum in e-commerce, offset by wholesale, given the ongoing conflict in The Middle East, and the tough spring season in the region, European wholesalers are understandably cautious and this is reflected in our Spring 2025 order book, which is down mid-single digits. To mitigate this, we are working more closely than ever with our key accounts curating stronger assortments and providing them more in season replenishment of our best selling products. We are also taking the insights we get from our own D2C business in the region. Where our European consumers continue to demonstrate their strong engagement and love for both of our brands. And using that to better serve our wholesale partners. And we know that as we execute these actions together, we will realize the significant long term opportunities in the region. During the summer, I had the opportunity to visit 5 markets in Europe and over 30 locations. it is always great to see the consumer love for our products first hand. And I was so impressed with the passion of our store teams and partners and how our focus on the key growth categories and best product franchises is translating more and more into the consumer experience. During these visits, I also see that we have still real growth opportunities in further expanding our category and franchise strength all the way out to every door and every store. In summary, we continue to make real progress as we execute our PVH plus plan. Leveraging the strength of our iconic Calvin Klein and Tommy Hilfiger brands to drive long term increasingly profitable growth. We delivered on our guidance for the quarter with strong gross margin performance, continued strength in e-commerce, and D2C growth and AUR expansion in both the Americas and APAC. In EMEA, we are navigating a challenging consumer environment, by staying even closer to our consumers and partners leaning into the strong love they have for Calvin and Tom. Across both brands, we continue to see that where we focus on the key categories where we have the right to play and win, we drive real commercial impact, with growth in multiple D2C categories, We remain committed to expanding the strength of our products to more of the assortment season by season. At the same time, we are stepping up our cost discipline, prioritizing our resources behind the PVH plus strategic pillars, that will drive growth and long term value creation, while continuously finding more efficient ways to operate. And we are starting Q3 well, Both Calvin and Tom are cutting through with stronger product great campaigns, and some of the most relevant talent in culture today. And we are looking forward to peak fall season. Before I hand the call over to Melissa, I would like to thank her for her truly exceptional partnership and great work as interim CFO. I look forward to working closely with both her and Alexei as we continue to execute our plan and unlock the full potential of Calvin Klein and Tommy Hilfiger. And with that, I will turn the call over to Melissa. Melissa Stone: Thank you, Stefan. Good morning. In the second quarter, we met or exceeded guidance across all key financial metrics. Revenue decreased 3% in both reported and constant currency, at the high end of our reported revenue guidance and slightly ahead of our constant currency guidance, with all 3 regions and licensing in line with our expectations. Operating margin was 11.1% and EPS was $3.70 ahead of our guidance with both gross margin and SG&A better than our plan. Tariff refunds were received during the quarter as expected, and contributed approximately 510 basis points to our operating margin and approximately $1.80 to our EPS. We are pleased with our second quarter execution. While top and bottom line results, excluding the tariff refunds, were below last year as we continued to navigate the dynamic global macro environment revenue was in line with guidance and profitability was better than expected. This supports our confidence in the full year plan we discussed last quarter balanced with caution given the continued uncertainty around global consumer demand. We are reaffirming our full year outlook for reported revenue of approximately flat and a slight decline on a constant currency basis, operating margin of 8.8% and EPS in the range of $11.80 to $12.10. I will now discuss our second quarter results in more detail and then move on to our outlook. From a regional perspective, Americas revenue was down 1% with DTC up slightly compared to the prior year period. We continued to drive strong growth in our e-commerce business, which was up high-single digits. Wholesale revenue was down low-single-digits and reflected the timing shift of certain shipments into the second half as we discussed last quarter, primarily impacting the Calvin Klein business, partially offset by an increase in wholesale revenue driven by the license transitions for Tommy Hilfiger North America. In APAC, revenue was up 3% reported and up 1% in constant currency. DTC revenue grew low-single-digits in constant currency led by growth in stores. E-commerce was down slightly, but remains on track for full year growth. Wholesale revenue declined mid-single-digits in constant currency as our partners remain cautious. Within the region, we drove strong mid-single-digit e-commerce growth in constant currency in China. In Australia, while macro headwinds continue to weigh on consumer spending, we saw an improvement compared to the first quarter result. EMEA was down 6% in both reported and constant currency, reflecting continued macro pressure, including lower consumer demand, due to the direct and indirect effects of the conflict in The Middle East. DTC revenue declined low-single digits in constant currency, improving compared to the mid-single-digit constant currency decline in the first quarter. With continued strength in e-commerce, which was up mid-single-digits and grew in both brands. Wholesale revenue declined high-single digits in constant currency, reflecting the cautious market backdrop. In our licensing business, revenue was down 13% as expected due to the North America license transitions. Excluding the impact of these transitions, our ongoing licensing business grew low-single digits. Turning to our Global Brands. Tommy Hilfiger revenues were flat in both reported and constant currency, and included an approximately 3 percentage point increase attributable to the wholesale sell in of previously licensed Tommy Hilfiger women's product categories in The Americas. Excluding the transition impact, Tommy Hilfiger revenues were down approximately 3% versus last year. Calvin Klein revenues were down 7% in both reported and constant currency, and included an approximately 4 percentage point decrease attributable to the wholesale shipment timing in Americas as just discussed. Excluding the timing impact, Calvin Klein revenues were down approximately 3% versus last year. From an overall channel perspective, direct to consumer revenue was flat and reported in constant currency. E-commerce grew 4% reported and 3% in constant currency, driven by growth in EMEA and Americas with growth in both Calvin Klein and Tommy Hilfiger. Revenue in our retail stores was down 1% on both the reported and constant currency basis with growth in APAC more than offset by decreases in EMEA and Americas. Wholesale revenue was down 6% in both reported and constant currency, primarily driven by EMEA. Americas and APAC also declined to a lesser extent, as I just discussed. In the second quarter, our gross margin was 63%, an increase of 35 basis points compared to last year. During the quarter, we received the tariff refunds we discussed last quarter, which contributed $107 million and approximately 510 basis points benefit to gross margin. Excluding the benefit of tariff refunds, gross margin increased approximately 20 basis points compared to last year and reflected lower product costs, including favorable foreign exchange and favorable channel mix. Partially offset by a more promotional environment in EMEA, increased tariff costs net of mitigation, and the impact of the North America license transitions. Notably, gross margin expanded in both APAC and in The Americas, excluding tariff refunds, driven by higher AURs in DTC, supported by strong promotional discipline and a benefit from favorable channel mix. Inventory was down 3% and lower in all regions. We continued to tightly manage our inventory, and we have healthy levels of core products and improved stock freshness. Looking ahead, we expect Q3 inventory will be up year over year to support The Americas wholesale shipments which are weighted more heavily to the second half compared to last year. SG&A increased 240 basis points to 51.9% of revenue but was better than planned, reflecting continued cost discipline across the business and an approximately 20 basis point timing benefit from a shift in marketing spend into Q3. The increase versus last year reflected our continued investment in the business, including an 80 basis point increase in marketing, as well as a higher channel mix impact and deleverage on lower revenue. Excluding the increased marketing investment, SG&A dollars were approximately flat to last year in constant currency. In sum, EBIT for the second quarter was $233 million and operating margin was 11.1%, including the $107 million tariff refunds benefit compared to EBIT of $178 million and operating margin of 8.2% in the prior year. Excluding the tariff refunds, EBIT for the second quarter was $126 million and operating margin was 6%. EPS was $3.70 including the approximately $1.80 benefit from the tariff refunds, compared to $2.52 last year. Interest expense was $12 million and our tax rate was approximately 22%. On a GAAP basis, we also recognized a noncash goodwill impairment charge of $439 million reflecting changes in valuation assumptions associated with geopolitical and macroeconomic factors. Now moving on to our outlook. We continue to expect full year reported revenue to be approximately flat to the prior year and down slightly in constant currency, with relatively similar expectations for both Calvin Klein and Tommy Hilfiger versus last year. Regionally, our revenue outlook also remains consistent what we shared last quarter, with growth in both the Americas and APAC offset by pressure in our EMEA business. Importantly, we continue to expect e-commerce growth for the full year in all regions. For the year, we continue to expect gross margin and SG&A as a percent of revenue each to increase approximately 100 basis points versus last year, and we are reaffirming our operating margin outlook of approximately 8.8% and our EPS outlook of $11.80 to $12.10 which as we talked about last quarter, includes the benefit of the tariff refunds we received in Q2. While new tariff rates have been recently announced, the situation remains fluid. We continue to closely monitor developments work hand in hand with our partners and actively manage our mitigation efforts. On SG&A, we continue to invest in our brands and our business where we see momentum. We continue to expect that marketing spend will increase at least 50 basis points to approximately 6% of sales for the full year. And as Stefan shared, are managing our costs with increased rigor and this work will drive the discipline and governance needed to support additional savings in 2027 and beyond. Turning to below the line items, Net interest expense is now expected to be approximately $70 million compared to $75 million previously. Our expectation for our tax rate is unchanged at 22% to 23%. With respect to capital allocation, remain on track with our plans for capital spending of approximately $250 million or approximately 3% of sales as we invest globally in e-commerce, stores and shop in shop renovations. And we continue to expect to repurchase at least $300 million of our shares. Now moving to our outlook for the third quarter. We are projecting third quarter revenue to be down low-single-digits in both reported and constant currency compared to the prior year, with Q2 DTC trends generally expected to continue across all regions. In Americas, we are planning revenue up mid-single-digits with DTC up slightly and wholesale revenue benefiting from the planned first half to second half timing shift discussed previously with a more significant timing benefit expected in Q4. In Asia Pacific, we expect revenue to be relatively flat in constant currency, as growth in DTC is offset by continued caution in wholesale. In EMEA, we expect revenue to continue to be down mid-single in constant currency, with declines in both channels. In our licensing business, revenue is expected to be down mid-single-digits driven by the previously mentioned North America license transitions with growth expected to continue in the go forward business. We expect our third quarter gross margin to increase approximately 100 basis points compared to last year, reflecting lower product costs, including favorable foreign exchange, higher AURs and favorable channel mix. We expect gross margin expansion in all 3 regions. SG&A expense as a percent of revenue is expected to increase over 200 basis points compared to last year, reflecting strategic investments in our brands and our business, including approximately 100 basis points of higher marketing investment as well as a higher channel mix impact and deleverage on lower revenue. For the second half, marketing as a percent of sales is expected to be up slightly versus last year, with spending weighted to Q3 due to the timing shift from Q2 and the acceleration of certain investments to maximize their impact around key consumer moments. As a result, marketing as a percent of sales is expected to be up in Q3 and down in Q4 versus last year. Third quarter operating margin is expected to be approximately 7.5% improving compared to Q2 operating margin excluding the tariff refund benefit. EPS is expected to be in a range of $2.50 to $2.65 with a tax rate of approximately 22% and interest expense of approximately $18 million In closing, we are pleased with our second quarter execution and the improvement in several parts of the business while recognizing that the external environment remains uncertain. Our targeted investments behind our brands, disciplined inventory and cost management, and continued execution of the PVH plus plan support our confidence in our full year outlook and our ability to create long term shareholder value. With that, operator, we would like to open it up for questions. Operator: Thank you. If you would like to ask a question, please press 1 on your keypad. To leave the queue at any time, press 2. Once again, that is *1 to ask a question. And our first question today comes from Bob Drbul with BTIG. Your line is now open. Bob Durbel: Hi. Good morning. I was wondering if you could spend some time, on the marketing side, you know, there is-- it is been really good visibility. You know, some of the activations And I am just curious if you can, talk to the marketing ROI that you are seeing with some of these pretty high profile campaigns, And I guess I was also curious if you had to pay Travis Kelce for his dog in that Tommy video. Yeah. Stefan Larsson: So Thanks, Bob. I will come back to Travis' dog, Wendy. So we will come back to Wendy because Wendy now has multimillion following on social as I am sure you have seen. So just grateful that he decided to bring his own dog to the shoot, and he tells you a little bit about Travis' connection and partnership with Tommy. it is pretty incredible. But let me back up and talk about the strengthening marketing ROI because it is really something that excites us because we see that our investment and the way it is especially our investments and the way we apply those investments that drive the strengthening ROI. So the key leading indicator is we see strong, as I mentioned in my prepared remarks, we see strong traffic growth, consumer acquisition is really strong. Targeted to our power segment, the status shopper, and the style enthusiast. So we see the ecommerce traffic, Calvin up double-digit, Tommy up high-single digits. that is a very strong leading indicator that then drives the D2C growth, ecommerce growth across the company, including in that including in Europe, given that we had the disruption from the Middle East war, we were still able to drive strong traffic increase and e-commerce growth. And then full d to c growth in North America and APAC, where we had less disruption. So those are really encouraging proof points. Then I also feel like it is it is best to break it down into concrete And if we look at fall and the start of fall, we are just the brands are lined up stronger with more integrated campaigns since, I would say, since we started the PVH plus journey. And as you know, we have had a lot of hep heavy lifting to do to get the foundation in place. But what-- when you see Calvin start with Tate McRae, and Sadie Sink let's just take Sadie Sink, the most recent talent. And it is not just about the talent is incredible, But it is the way it is the campaign is built up in the key and core categories. So it is a denim campaign that connects many different talent to feel the fit. And then it is denim and underwear. And if you look at denim and underwear, that is the biggest that is a big part of Calvin Klein. So you look at the SADI campaign so far, just with SADI, 14% social engagement rate, which is really high. 60% consumer mentions versus Spring, 60% up. Over 20 million views on Instagram first week. 90 but here's what is really interesting. 96% of those views were from non followers, status shop demographics 18 to 34. So it is-- we are starting to become really effective in driving our consumer acquisition to our target consumer They already love the brand because both Calvin and Tom are 2 of the most 2 out of 7 most beloved brands globally. And then we are getting more and more to connect the different parts of the consumer journey. Travis, I have to come back to Travis. 10% social engagement since we launched really high. Search interest globally up, Over 20 media outlets in The US only have been writing about Travis and Tommy. Travis mentioned it on his podcast, which is a top 10 podcast globally, where 1 billion impressions on social first 24 hours, Instagram views up versus same time last fall 500%. And you can see how this is driving. So in Q2, you saw how this started to drive return in sweaters up double-digit in revenue, shirts and polos up mid-single-digit. Transitional outerwear up. So that is that is what is driving the strengthening of the ROI. But I am I am really proud of the team's work on lining up such strong fall start. And you should check it out on both Calvin and Tommy if you have not checked it out. it is very good. Do we have more work to do? Of course. We can improve in every single area, but it is it is a lot of foundational work that has led to the strength of fall. Thank you very much. Melissa Stone: And, Bob, I will just add in terms of our outlook, we previously shared that we are increasing our full year marketing investment by at least 50 basis points as a percentage of sales compared to last year, bringing it to 6%. And that in the second half, we would lap the stepped up level of that we began in 2025 in the second half. And so within that, we are rebalancing our investment between Q3 and Q4 to drive that consistent drumbeat in fall and into holiday that Stefan just talked about. Perfect. Thanks, Melissa. Stefan Larsson: Thanks, Bob. Operator: Our next question comes from Jay Sole with UBS. Line is now open. Jay Sole: Great. Thank you so much. So my question is about the trends in Europe. David, you mentioned the order book for spring. Can you just talk about what you see as the underlying for the brand? Because it sounds like you are gonna take some actions to be able to sort of fulfill at-once for wholesale partners to make it easier for them. But just talk about what you think to Europe as can grow in total from a total sellout standpoint, including all channels as you as we get through this year and into next year? And kind of why you feel that way? Thank you. Stefan Larsson: Thanks, Jay. Really important So if we look at Q2 for Europe, we were early. 1 if not the most early to flag the Middle East war effects, and we took a hit in Q1 for that. But what is good to see is what we said we were going to do on the trends we saw, we delivered in Q2. So Europe continued to be consistent with what we expected coming into Q2, coming out of Q2. But within that, we see ecommerce growth increasing, and it is very much driven to what Bob asked about the marketing effectiveness. And in the areas where we have the most control, of the end to end consumer experience, we drove strong growth in traffic and growth in d to c e-commerce. And then all d to c trends overall in Q2 improved in Europe versus Q1. So to your point, we are focusing on 2 things here. We are working closer with our key accounts than any time before. So we know that wholesale, when they have a top season like we had in spring in Europe, they will be cautious going into the next spring. We knew we knew that, and we know that. So what we are doing is we are working super closely with them on a very granular level to make sure that we lean in even more into the key growth strategy, even more into our key franchises with newness and Innovation Because having spent a lot of my time this summer in Europe with the team is where we lean into the key growth categories, where we lean into the best franchises, where we have newness and innovation, whether it is transitional outerwear shirts, denim, underwear, we are able to drive growth. So that the way we apply that is much more granular even more detailed planning on a key account level for next spring but also complementing the forward looking orders with the in season replenishment, which is just going to be increasingly important. So we are working closely with identifying our key categories, key franchises right price points, right timing with the with accounts and then having the capability to replenish much more in season. So if you look at the forward looking order books, it is north of 50% of the wholesale sales. And the rest is in season. So that is how we work with wholesale. On D2C c, we just continue to lean into the consumer love that is so strong in Europe for both Calvin and Tommy. Again, what I shared with the team coming back. I was 5, 6, 7 different airports in Europe this summer. it is incredible when you are peak holiday period. You walk around in an airport, you take a coffee, and you see so many consumers wearing Calvin Klein and Tommy Hilfiger. So it is really about taking share in a in a market that is being disrupted by the Middle East. But the good news is ecommerce up, D2C improved, and closer to our wholesale accounts. Jay Sole: Got it. Okay. that is great. Thank you so much. Stefan Larsson: Thank you. Operator: And our next question comes from Dana Telsey with Telsey Advisory Group. Your line is now open. Dana Telsey: Hi. Good morning, everyone. Stefan, as you think about the licensing transition, how is it progressing? What do you what are you seeing there? And how are you thinking about the brands and the categories go forward? And last quarter, mentioned about the hero products and new products. What are you seeing now and your thoughts for the future? Thank you. Stefan Larsson: Thanks, Dana. As I mentioned as well in my prepared remarks, the licensing business is super important to us, and there are really 2 big parts there. The transition of our women's licensing in North America is on plan and going to be done by end of this year. So underlying the next part so we are on plan, and it is going to be done by the end of this year. The next big part in licensing from an investor perspective that is super important to share is we are leaning in and growing with our brand building licensing We have over a $300 million revenue coming from licensing. it is reoccurring. it is growing. So we are growing underneath the transition of women's North America. We are growing our go forward licensing portfolio. And having Joel Samaha come in with his deep licensing partner experience has been exciting to see what he has already been able to do with the strength we have already on the team, on our licensing team, is to set us up for overall licensing growth for 2027. So it is really our strategy is very clear. We are in control of the core brand expression and we do those categories better and better and better as you can see in our e-commerce D2C growth, etcetera. And then we complement that with expertise from our best partners globally. And I spend a lot of time with our partners, and it is the combination that excites them that we are building the consumer flywheel in the core proposition of the brand. We are investing in relevance for the brands, relevance at the core categories, and then they complement that with relevance where they have more expertise than us. So I am it is been a long transition, but we are looking at the other end now where we see overall growth starting in 2020. And then we just continue to grow from there. Dana Telsey: Got it. And then the product hero versus friend versus fashion, you are thinking about that for the back half of the year for the brands? Stefan Larsson: Yeah. Also super interesting question. So heroes has a lot of passion in it as well. So if you look at if you look at denim where-- when we look at our deep consumer research, we saw early in the PVH plus journey that we stand so strong in underwear and so strong in denim, but the business in denim is much smaller versus what the consumer sees us having the right to play. So when we lean into denim now, double digit growth, double digit AUR growth, So here comes the pricing power. And within that, we have a lot of ways that we have made the iconic Calvin denim more current than ever before. So it is really the combination of when something is iconic, and something is fashionable and current, that is when it really works. Same with Tom leaning into sweaters and cable knits and building out those franchises. And then having Travis in those cable knits and loving the brand and so it is really the combination of leaning into what is iconic, and we know from consumer research that the consumer already loves with the brands. We do not have to convince anyone that Calvin and Tommy that they like Calvin and Tom. it is about driving that brand love through the full funnel, and that is what we are doing better and better. So it is a mix between it has to be iconic, and it has to be fresh, current, and fashionable. So you should, again, really check out how we show up in Calvin in denim, how we show up in underwear, how we show up in sweaters, transitional outerwear in Tommy. it is really a big step forward this fall. Thank you. Operator: Thank you. Our next question comes from Blake Anderson with Jefferies. Your line is now open. Analyst: Hi. Thanks for taking my questions. So I wanted to ask first, would be great to hear Alexei's key priorities into the new CFO role. And going forward. And then if you could comment on The U.S. region and the consumer there, there is still higher gas prices. Would be curious how the macro impact is unfolding there on your business and especially any comments you are seeing on pricing elasticity given the AURs you are seeing there? Stefan Larsson: Yeah. Thanks, Blake. So could not be more thrilled to have Alexei join. I know you have been waiting patiently from the investor community for our search to be completed, but what I shared through the process is true, which is we needed to find the person with the right experience. So here is Alexei. With why his experience is so important to us is he has been part of the team global leadership team for Sephora for a long time. During his tenure, they have significantly expanded the business and the way they have done it is increasingly profitable. So I wanted to find a partner on the finance side that is equally interested in the consumer-facing improvements of Calvin and Tom, as the efficiency parts. Part of his priority is coming in. he is going to be here in New York with us on Monday, starting Monday next week or Tuesday after Labor Day. And 1 of the key priorities here is driving and leading together with me and the leadership team, the increased cost focus because it is both. We are gonna drive very focused investment in driving the consumer flywheel, you are going to see 2027 significant improvements on cost side as well. And we have not waited for Alexei to lean into that, but his experience of doing this with deep European experience, deep US experience, APAC experience, and Sephora, they have gotten to be known for they just deliver. So it is it is really exciting to have him join. Your next question when it comes to US consumer. So we see The US consumer being very resilient and holding up, and we see the consumer in The US responding really well to where we lean into these key categories and key franchises. We see the pricing see the pricing power coming up. So it is really about delivering great value to the consumer, and that comes out of 2 pieces, relevance in brand and product, and the right price. And when everywhere where we take that iconic strength of the brands and translate that into relevance in product, and create great price value, it works really well. So we are encouraged so far. Environment, but we are encouraged by the consumer. Thank you. Operator: Our next question comes from Michael Binetti with Evercore. Michael Binetti: Hey, guys. Thanks for all your help here today. Stefan, you talked about the EMEA spring orders. For next year down mid-singles. As you guys work closely with the wholesale channel, maybe talk a little bit about what you can do to try to drive the direct to consumer channel towards positivity in that environment since that is where you have a lot more control. And then I think we have heard a lot of retailers talk about investing tariff refunds in lower prices in The U. S. Is that contemplated in the guidance considering fourth quarter gross margin compressing year over year that Melissa talked about? And then I guess when you look at some of the medium term comments that you have given us today, some of the run rate cost efficiencies, the spring order books, the licensing, wrapping up this year. it is pretty noisy. Is a starting point we can think about for how the operating margins in the business should trend in 2027? Okay, Michael. Stefan Larsson: So thank you. I picked up 3 parts of your question. So let me start, and Melissa and I will take turns. But let me start on the D2C part. So that is where we see, again, to your point, that is where we see the biggest proof points despite the disruptive background in Europe. E-commerce is up. D2C is better in Europe in Q2 versus Q1, and we it is very clear. And Americas and APAC, D2C is up as planned, and we continue to have them up for the rest of the year. And we really see we are really clear on what is driving that. It is that increased brand relevance, increased targeting the Gen Z young millennial, increased focus on the key categories and putting newness and innovation and putting in best behind the newness and innovation in the big franchises and really letting that show up super strong in the doors and stores. So that is very similar of how we work with our best wholesale partners. I spend a lot of time with some of our best and biggest partners this summer in Europe. And what is really exciting is they are really good retailers, so they have really good consumer insights. And so they know they see where the where the consumer is going, and they see it across the market. So it is really hand in hand working closer with them on making sure we have enough newness and innovation in matching the consumer demand whether it is denim, underwear, sweaters, transitional underwear. And where we have that, we see that we drive growth with them. And then and then as I shared, in-season is going to be even more important with wholesale. So that is why the closeness of our key account partnership is just going to be even more important. And the way we already now prepare for spring 27 to compensate for that cautiousness in the forward looking order books is to make sure that we are ready to replenish our bestsellers. And our bestsellers, we are so clear on what they are right now. So what I am coming back to Europe this summer, when I am out in the 5 markets and the over 30 stores, I see so much growth opportunity just by being better in inventory -- bigger and better presentation of our key categories, best franchises. that is how we work across taking the strength and also tapping into the strength of our partners because it is it is when we combine their strength with our strength, that is when we can really mitigate the external disruption. The third let's see here. The third question or I think there is a question on gross margins. Melissa Stone: I can just touch on that. So as we as we think about gross margin, yep. Yeah. So we have not changed our overall gross margin guidance for the year. In Q2, we drove gross margin better than planned up 20 basis points excluding the tariff refunds, and we expect Q3 gross margin to be up about a 100 basis points with expansion in all regions as we continue to drive that B2C strength through higher AURs as we have already done in Q2 and Q3 sorry, Q2 in Americas and APAC. So we have seen a good start to fall, as Stephan talked about, with our products, and Q3 is when most of our fall product ships which supports that expansion. So we feel good about Q3 gross margin. And then when we think about Q4 and given our guidance for the full year, that does as you mentioned, imply we expect gross margin will be lower. And so there is 3 things I will I will mention as we think about that. First, there is a channel mix effect. In Q4, when we think about that weighted timing of the North America wholesale shipments that we have mentioned. Second, we are giving ourselves some flexibility to strategically support a promotional holiday landscape if that becomes necessary. And then the third thing is that there continues to be uncertainty around tariff rates. And so we have embedded support for volatility in that as well. And so I think, you know, we think that is a prudent approach given where we are at in the year and the dynamic operating environment. Stefan Larsson: I would say so building on what Melissa just said, Michael, it is we take a prudent approach. We feel good about reaffirming our guidance. And then I am not going to stress anyone out internally, with giving guidance for next year, but what I can say is that we are really leaning into cost as a real driver of EBIT margin expansion. So you should expect that it is-- we are significantly leaning into that, and you should see an effect in 2027. More than the guidance when it is time for guidance of 2027. Thanks, Ivan. Michael Binetti: Thank you. Operator: Thank you. At this time, we have reached our allotted time for questions. I will now turn the call back to Stefan for any additional or closing remarks. Stefan Larsson: All right. Thank you, everyone, for your time with us this morning. What I would really like to reiterate is engage with Calvin and Tommy on TikTok, engage in a way where you search Tommy and Travis, Calvin and Sadie, or Calvin and Tate. Like, really see because 1 thing is what we say as brands, but it is really what the consumer says. So I spend as soon as we launch a campaign, I spend a lot of hours at night looking at what others are saying. what is the consumer? that is the kind of economy that is the kind of consumer landscape we live in now. So you see-- you will firsthand see on TikTok You will see the engagement on Instagram. Click through to shop. And the connection between the campaigns and the brand relevance and the key franchises and key categories, I hope you see what I see, which is, and the consumer sees. That it is much stronger. So it is a step in the right direction and I am sure you will see opportunities and send them my way because we are head down, just continuing to improve. But check out Calvin and Tom for the fall campaigns, and looking forward to reconnecting next quarter. Thank you. Operator: Thank you. This brings us to the end of today's meeting. We appreciate your time and participation. You may now disconnect. Before you buy stock in PVH, 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 PVH wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years. 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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. PVH (PVH) Q2 2026 Earnings Call Transcript was originally published by The Motley Fool

Download the Complete Report Here Key Takeaways: New CEO Charlie Cole used his first earnings call to sharpen LE’s growth agenda around customer engagement, digital execution and operating infrastructure, building on the existing franchise-led strategy. Cole joined in July and emphasized that the strategic direction remains intact, with the immediate priority on improving execution across fulfilment, technology and customer acquisition ahead of the holiday season. With more than 95% of the business conducted online, the opportunity is increasingly to improve how LE reaches, engages and converts customers while leveraging its existing brand, product franchises and first-party customer data more effectively. The agenda is therefore evolutionary rather than a strategic reset, but it establishes a clearer execution framework around customer experience, digital capabilities and more scalable growth. 2Q FY26 marked meaningful progress beyond the first-quarter fulfilment disruption, with revenue returning to growth and core U.S. eCommerce operations normalizing. Revenue increased 2.7% y/y to $302.0 million from $294.1 million, above the mid-point of guidance of $290-$310 million, while U.S. Digital revenue increased 5.3% to $268.9 million. U.S. eCommerce revenue increased 9.0% to $182.4 million, Outfitters grew 4.4% to $69.3 million and Europe increased 0.5% to $19.7 million, partially offset by a 20.4% decline in Third Party revenue to $17.2 million. Adjusted net income improved to $2.7 million, or $0.09 per share, from an adjusted loss of $1.1 million, or $0.04 per share, while adjusted EBITDA declined 25.2% y/y to $11.3 million from $15.1 million and margin compressed to 3.7% from 5.1%. We believe the quarter provides meaningful evidence that the core U.S. operational disruption is receding, shifting the investment focus toward demand conversion, post-JV margin recovery and cash generation. Product franchises are becoming increasingly important customer-acquisition vehicles, with totes and swim supporting both near-term demand and broader demographic reach. Women’s and men’s apparel, particularly knits, performed well during the quarter, while U.S. eCommerce swim revenue increased at a high-single-digit rate and bags, led by the iconic five-pocket tote, remained a meaningful growth contributor. Totes and swim drove much of the double-digit increase in new-to-file customers, while personalization and embroidery add higher-value services around the tote franchise. The Wawa collaboration generated more than 2.6 billion impressions and sold out within hours, complementing other activations including T&T and Nantucket that targeted new and younger audiences. LE is also developing sleep as a year-round category, with early indicators described as positive, while initial reads on outerwear and Christmas stockings provide early visibility into 3Q and 4Q. The broader opportunity is to use high-recognition franchises as acquisition products and then convert those customers into repeat and cross-category purchasing, improving lifetime value beyond the initial transaction. Core U.S. eCommerce fulfilment has normalized, setting up 3Q as a cleaner read on underlying demand after 2Q benefited from shipment catch-up. S. eCommerce revenue reached $182.4 million, up $15.1 million y/y, but first-half revenue of $335.7 million remained 0.7% below the $338.0 million generated in the comparable prior-year period after the shipment catch-up was completed. Operations are now running at normal throughput, at the same or higher levels than before the WMS disruption, and no incremental impact on 3Q or 4Q guidance is anticipated outside the remaining Outfitters catch-up. Additional supporting warehouse software is expected next year, with the primary opportunity centred on service levels and customer lifetime value rather than a quantified direct earnings contribution. This distinction is important: the WMS should no longer obscure underlying U.S. demand, making 3Q a cleaner test of whether product, acquisition and merchandising initiatives can drive a return to sustainable organic growth in the core eCommerce business. Outfitters remained operationally constrained in 2Q despite strong enterprise-account momentum. Outfitters revenue increased 4.4% y/y to $69.3 million in 2Q as enterprise growth more than offset continued delays in school-uniform value-added services, although 1H26 revenue remained 1.4% lower at $107.8 million versus $109.3 million. Enterprise revenue increased more than 15% year-to-date, led by airline accounts, while Delta is currently wear-testing its new uniform collection with more than 1,400 frontline employees ahead of a planned 2H27 rollout. School-uniform backlog remained elevated during 2Q because embroidery, personalization and other value-added orders were more difficult to process under the new WMS, delaying revenue recognition despite solid underlying demand. Throughput has since returned to normal levels, positioning Outfitters to work through the remaining backlog and allowing reported performance to more closely reflect the underlying enterprise and school demand profile. Europe and Third Party continue to shift toward higher-quality revenue, prioritizing product margin and brand positioning over promotional volume. Europe eCommerce revenue was broadly stable at $19.7 million in 2Q, but increased 7.5% to $40.3 million in 1H26 as the business moved toward a simplified franchise-first assortment and reduced promotional dependence. Customer acquisition in Europe also improved at a lower cost, while Amazon Germany went live in August and provides an incremental channel to reach new customers. Third Party revenue declined 20.4% to $17.2 million, and first-half revenue declined 14.3% to $30.5 million, reflecting a deliberate pullback from lower-value promotional sales; importantly, like-for-like gross margin improved by more than 500 bps y/y. Nordstrom was a bright spot, with outerwear and Wanderweight performing well during its anniversary sale. We do not view the Third-Party revenue decline as evidence of deterioration in the core business, because the strategy is explicitly sacrificing lower-margin volume to improve channel economics and protect brand integrity. The WHP JV is now contributing visible earnings and cash, although retained operations are absorbing the royalty burden before new licensing agreements fully mature. The JV generated $20.1 million of revenue and $8.5 million of net earnings in 2Q, with LE recognizing $4.2 million of equity-method income from its 50% interest. LE recognized $4.4 million of JV income during 1H26 and received $2.4 million of cash distributions, while retained operations incurred $15.4 million of royalty expense in 2Q and $18.9 million year-to-date. The license carries a $50 million annual guaranteed minimum royalty through contract year 11, making growth in third-party JV licensing income increasingly important to the longer-term post-JV earnings equation. The JV has amended several agreements expected to generate more than $150 million of long-term guaranteed royalty value, but newly originated licenses require product development, distribution and retail placement before contributing materially, leaving near-term FY26 economics weighted toward existing licenses and several smaller agreements already in place. The central post-JV thesis therefore remains unchanged: the royalty burden is immediate, while the value creation comes from LE retaining 50% of a growing, capital-light licensing profit pool as WHP expands the brand across new categories and geographies without requiring LE to fund the associated inventory or operating infrastructure. AI and personalization are emerging as important elements of LE’s digital strategy, with potential to improve conversion, retention and merchandising efficiency across channels. LE’s approximately 20-year average customer relationship and decades of catalogue and eCommerce engagement provide a substantial first-party data foundation, which the company plans to combine with purchase history, browsing behaviour, geography, weather, inventory availability and category affinity to create more individualized experiences across eCommerce, CRM, catalogue segmentation and marketing. The same approach can extend to Europe and Outfitters, including more targeted outreach around school-uniform purchasing cycles. The objective is to improve conversion, lifetime value and Net Promoter Score by making customer engagement more relevant and timely. LE also appointed Jimmy Ferolo as Chief Digital and Technology Officer, strengthening leadership around digital transformation while maintaining continuity within the existing technology organization. Customer-acquisition investment is beginning to produce measurable engagement gains without a material increase in marketing intensity, an encouraging signal for the new digital agenda. U.S. Digital marketing expense increased to $46.0 million from $43.3 million but represented 17.1% of segment revenue compared with 17.0% a year ago, meaning the company generated double-digit new-to-file growth and more than 30% social-traffic growth while marketing intensity remained broadly stable. SG&A increased $5.9 million to $135.3 million, or 44.8% of revenue versus 44.0% a year ago, reflecting higher digital-marketing investment and residual WMS inefficiencies. The next checkpoint is whether stronger engagement translates into higher repeat purchasing, better conversion and more productive full-price demand. Gross margin expanded sharply, while channel discipline improved underlying economics despite continued post-JV and WMS costs. Gross profit increased 9.5% to $157.0 million from $143.4 million, while gross margin expanded approximately 320 bps to 52.0% from 48.8%, primarily reflecting the $24.9 million IEEPA tariff recovery, partially offset by $5.1 million of unmitigated tariff costs, the new JV royalty structure and temporary WMS inefficiencies. U.S. Digital variable profit increased $14.7 million to $71.4 million, with margin expanding 440 bps to 26.6% from 22.2%, although the same tariff refund was a principal driver and was partly offset by higher marketing, WMS costs and royalties. Adjusted EBITDA, which removes the tariff recovery and other significant items, declined to $11.3 million from $15.1 million, indicating that underlying profitability remains below prior-year levels despite improved revenue and channel mix. Lower financial leverage is already improving earnings conversion under the post-WHP structure despite softer operating EBITDA. Interest expense declined ~89% to $1.0 million from $9.3 million y/y after LE used $234 million of the $300 million WHP transaction proceeds to repay its term loan. Operating income increased to $8.2 million from $4.0 million, while net income improved to $3.5 million, or $0.11 per diluted share, from a ($3.7) million loss, or ($0.12) per share. Adjusted net income similarly improved to $2.7 million from a $1.1 million loss despite the $3.8 million y/y decline in adjusted EBITDA. The earnings bridge demonstrates the benefit of the post-JV capital structure, with lower interest expense already improving equity earnings while further EBITDA recovery would provide the next leg of earnings growth. Inventory remains elevated heading into the holiday season, making sell-through and working-capital conversion critical alongside the broader operating recovery. Inventory reached $342.0 million at quarter-end, up 13% from $301.8 million a year ago and 27% from $268.8 million at FY25-end, reflecting a more normal seasonal build after last year’s deliberately lean tariff-driven position, continued tariff headwinds and residual value-added-service processing delays. The inventory build used $73.9 million of cash during the first half, contributing to operating cash flow of negative $86.5 million versus positive $0.5 million a year ago. The broader outerwear assortment creates a larger back-half revenue opportunity after last year’s conservative buys, but the quality of the inventory build will ultimately be measured by full-price sell-through and cash conversion rather than merchandise availability alone. Capital allocation became more active despite the seasonal working-capital build, reflecting the increased flexibility created by eliminating the term loan. LE ended 2Q with $16.1 million of cash, $60.0 million of ABL borrowings and $89.3 million of remaining ABL availability. The increase in revolver usage coincides with the seasonal inventory build and approximately $24.0 million of first-half capital expenditure, while the company continues to expect roughly $40 million of FY26 capex. LE repurchased approximately 910,000 shares for $10.5 million during 2Q, representing roughly 3% of outstanding shares, leaving $89.2 million under the $100 million authorization through March 2029. We view the repurchases as supportive at the current valuation, although the pace of future capital returns should remain balanced against working-capital needs, technology investment and sustainable free cash generation. 3Q should provide a cleaner read on underlying demand and margin recovery as fulfilment normalizes and temporary operating inefficiencies ease. Management guided 3Q revenue to $300-$330 million and adjusted EBITDA to $14-$18 million, while Street estimates sourced from TIKR sit at $319.3 million and $15.9 million, respectively. Importantly, the WMS is no longer expected to create an incremental headwind outside the remaining Outfitters catch-up, making the quarter a better test of whether recent customer-acquisition gains, franchise momentum and improved service levels are translating into underlying growth. The Street estimate implies a 5.0% EBITDA margin in 3Q versus 3.7% in 2Q, suggesting further margin normalization as temporary operating inefficiencies ease. With tariffs at currently implemented rates already reflected in guidance, execution around demand conversion, Outfitters backlog clearance and product margin should increasingly determine the near-term earnings trajectory. FY26 outlook continues to support post-JV earnings growth, while lower financial leverage is improving earnings conversion. Management guides FY26 revenue to $1.30-$1.35 billion, adjusted EBITDA to $62-$70 million and adjusted EPS to $0.44-$0.72. Street estimates sourced from TIKR indicate $1.33 billion in revenue, $68.3 million of EBITDA and $0.51 of normalized EPS, consistent with broadly stable revenue and progressive margin rebuilding under the post-JV structure. Importantly, the $68.3 million FY26 EBITDA estimate represents 21.8% growth from the comparable $56.1 million recast FY25 post-JV base, providing a more relevant measure of underlying earnings progression than reported FY25 results. Looking into FY27, Street estimates call for revenue growth of 4.1% to $1.39 billion and EBITDA growth of 7.1% to $73.2 million, supporting continued organic growth, better operating leverage and increasing benefits from the capital-light JV model. Disclaimer: Exec Edge does not publish proprietary estimates, ratings, price targets, or investment recommendations. The valuation discussion below is illustrative only and is based on company filings, management commentary, and third-party data and estimates. It does not constitute a recommendation, price target, rating, or prediction of future pricing. LE continues to trade at a meaningful discount to apparel peers despite an improving post-JV earnings profile and above-peer expected EBITDA growth. LE currently trades at a market capitalization of ~$323 million and enterprise value of ~$384 million. This translates to 5.62x FY26E EV/EBITDA and 0.24x FY26E P/S, compared with peer averages of 7.60x and 0.55x, respectively, representing discounts of approximately 26% and 56%. Street estimates sourced from TIKR call for FY26E EBITDA growth of 21.8% from the comparable $56.1 million recast FY25 base versus 1.4% average growth for peers. LE’s 5.1% FY26E EBITDA margin remains below the peer average of 8.9%, leaving meaningful earnings upside if the post-JV model closes part of the profitability gap. Applying the peer-based valuation framework continues to indicate meaningful illustrative upside. We believe the current discount can narrow as the benefits of the post-JV structure become more visible in earnings and cash flow. Fulfilment normalization, improving customer acquisition, Outfitters backlog conversion and service normalization, margin expansion, increasing JV income and distributions, and better working-capital conversion represent the principal rerating drivers. Cole’s focus on digital execution, personalization and customer lifetime value provides an additional medium-term lever, while the substantially reduced debt burden improves earnings conversion and strategic flexibility. With LE trading below peer multiples despite stronger expected EBITDA growth, continued execution should support scope for multiple expansion as the business demonstrates a more profitable, less leveraged and increasingly capital-light earnings profile. Read Exec Edge’s Initiation on Lands’ End Here Subscribe to our Weekly Newsletter to Receive All Research Contact: Executives-Edge.com [email protected] The post Lands’ End New CEO Agenda, Customer Growth – Quarterly Update Report appeared first on ExecEdge.

PVH Corp. PVH delivered a mixed but encouraging second-quarter fiscal 2026 performance, with revenues meeting expectations and profitability exceeding guidance. The company continued to build momentum in its direct-to-consumer (DTC) business, grew e-commerce sales and saw improving trends in key markets. Management also reaffirmed its full-year outlook, reflecting confidence in the continued execution of its PVH+ Plan and its growth initiatives across Calvin Klein and TOMMY HILFIGER.Shares of PVH Corp. have rallied 10.5% in the six-month period against the Textile - Apparel industry's decline of 8.8%. Image Source: Zacks Investment Research PVH generated second-quarter revenues of $2.097 billion, down 3% from the prior-year period. However, revenues were at the high end of the company's guidance on a reported basis and exceeded its constant-currency expectations. The performance reflected continued momentum in DTC and e-commerce, although softness in wholesale and challenging consumer demand in certain international markets remained headwinds.On the profitability front, PVH performed better than expected. Adjusted operating margin came in at 11.1%, exceeding guidance of approximately 9.5%, while adjusted EPS of $3.70 surpassed the company's projected range of $3.00-$3.10. However, these results included a significant benefit from $107 million in tariff refunds, which contributed approximately 510 basis points to operating margin and $1.80 per share to EPS.Revenue trends varied across regions. EMEA revenues declined 6%, pressured by soft consumer demand and weaker wholesale performance amid the broader effects of the Middle East conflict and related macroeconomic challenges. Americas revenues fell 1%, partly reflecting the timing of Calvin Klein wholesale shipments, while APAC revenues increased 3%, driven by DTC growth.PVH also continued to strengthen its digital business, with e-commerce revenues rising 4% (3% in constant currency), driven by growth in the Americas and EMEA across both Calvin Klein and TOMMY HILFIGER. The company also benefited from higher online traffic, stronger performance in key hero product categories and positive consumer responses to new products and marketing campaigns. PVH Corp. price-consensus-chart | PVH Corp. Quote PVH reaffirmed its fiscal 2026 outlook despite ongoing macroeconomic and geopolitical uncertainty. The company continues to expect revenues to be approximately flat on a reported basis, with a slight decline anticipated in constant currency. PVH also maintained its outlook for a non-GAAP operating margin of approximately 8.8% and non-GAAP EPS of $11.80-$12.10 compared with $11.40 in fiscal 2025.For the fiscal third quarter, however, PVH expects a more challenging comparison, projecting revenues to decline in the low single digits and an adjusted operating margin of approximately 7.5%, below the prior-year level. Non-GAAP EPS is projected in the range of $2.50-$2.65, down from $2.83 in the year-ago quarter. This outlook suggests that management expects continued pressure from the macro environment even as it advances its strategic initiatives. PVH's DTC and digital momentum remain important pillars of its growth strategy. The company delivered DTC growth in both the Americas and APAC and improved its EMEA performance sequentially on a constant-currency basis. E-commerce growth across both Calvin Klein and Tommy Hilfiger, coupled with higher online traffic, suggests that PVH's investments in product, consumer engagement and the marketplace experience are gaining traction.The PVH+ Plan also provides a strategic framework for long-term growth. The company is focused on strengthening its two core brands through improved product offerings, stronger consumer engagement and a better marketplace experience. PVH continues to invest in brand-building initiatives and high-profile marketing campaigns while also pursuing cost discipline and a more data- and demand-driven operating model.Cost-efficiency efforts could provide another tailwind. PVH's Growth Driver 5 Actions, which focus on simplifying the operating model, centralizing processes and improving systems and automation, have generated annualized cost savings of more than $250 million. The company continues to pursue additional efficiency opportunities while maintaining targeted investments in its strategic priorities. Despite the positive progress, PVH continues to face a challenging global operating environment. Inflation, tariffs, interest rates and recession concerns are weighing on apparel demand, while the Middle East conflict has contributed to supply-chain disruptions, higher fuel costs, currency volatility and weaker consumer sentiment. These pressures have been particularly visible in EMEA, where PVH continues to face soft demand and a more promotional retail environment.Meanwhile, tariff and trade-policy uncertainty continues to pose a risk, with tariffs already affecting certain imports and the potential for additional duties. Wholesale revenues also remain under pressure, weighing on performance in both the EMEA and Americas regions, while the timing of wholesale shipments impacted Calvin Klein’s revenues. Moreover, PVH’s significant international presence exposes its results to foreign currency fluctuations, with more than 70% of fiscal 2025 revenues subject to foreign currency translation. PVH appears well-positioned to benefit from the continued execution of its PVH+ Plan, supported by improving DTC trends, e-commerce growth, stronger product and marketing initiatives, disciplined cost management and the long-term potential of its Calvin Klein and Tommy Hilfiger brands. The company's better-than-expected second-quarter profitability and reaffirmed full-year outlook also signal management's confidence in its underlying strategy.That said, investors should remain mindful of declining overall revenues, persistent wholesale weakness, soft consumer demand in parts of Europe, geopolitical uncertainty, tariffs and the substantial contribution of tariff refunds to second-quarter earnings. The weaker third-quarter outlook also indicates that near-term conditions remain challenging.Overall, PVH's strategic progress and improving DTC and digital momentum make the stock attractive from a longer-term perspective, but the company still faces meaningful macroeconomic and execution risks. Based on the shared information, PVH currently has a Zacks Rank #3 (Hold), with successful execution of the PVH+ Plan and continued strength in its core brands. Duluth Holdings Inc. DLTH, which deals in casual wear, workwear and accessories for men and women, currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here. Duluth Holdings delivered a trailing four-quarter earnings surprise of 107.5%, on average. The Zacks Consensus Estimate for DLTH’s current financial-year EPS indicates a decline of 11.6% from the year-ago number. Columbia Sportswear COLM, engages in marketing and distribution of outdoor and active lifestyle apparel, footwear and accessories, currently carries a Zacks Rank #2 (Buy).The Zacks Consensus Estimate for COLM’s current financial-year EPS is expected to rise 4.6% from the corresponding year-ago reported figure. COLM delivered a trailing four-quarter earnings surprise of 44.1%, on average.Ralph Lauren Corporation RL, which is a designer and marketer of premium lifestyle products, currently carries a Zacks Rank of 2. RL delivered a trailing four-quarter earnings surprise of 9.1%, on average. The Zacks Consensus Estimate for Ralph Lauren’s current financial-year sales indicates growth of 6.3% from the year-ago number. 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 PVH Corp. (PVH) : Free Stock Analysis Report Columbia Sportswear Company (COLM) : Free Stock Analysis Report Ralph Lauren Corporation (RL) : Free Stock Analysis Report Duluth Holdings Inc. (DLTH) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Shares of PVH Corp. largely held their ground after the company topped Wall Street’s profit projections but turned in sales declines. The Tommy Hilfiger- and Calvin Klein-parent’s stock rose 0.2 percent to $72.46 in trading on Thursday, leaving the company with a market capitalization of $3.3 billion. More from WWD PVH Tops Q2 Earnings Estimates, but Sees Heavy Impairment Charges PVH Stock Plummets 20.2% as Iran War Hits Sales Outlook PVH Lowers Sales Outlook Citing Impact of War in Iran Analysts see the company as undervalued and are waiting for chief executive officer Stefan Larsson’s PVH+ plan to have its full effect. Jay Sole, an analyst at UBS, has a target price of $121 on the stock, projecting a two-thirds increase. “PVH has the brand strength, strategy, and balance sheet to drive strong earnings growth over the long term. We forecast the company delivering” double-digit growth, said Sole, adding that the second-quarter report “increases our conviction in this view.” The analyst offered four good signs from the quarterly update, which had sales slipping 3 percent to $2.1 billion as adjusted earnings per share tallied $3.70, well ahead of the $3.08 analysts forecast. “The company has applied its PVH+ plan initiatives to its most important categories first,” Sole said. “We believe this has resulted in these categories becoming PVH’s best performers, including in Q2 Calvin Klein saw good strength in underwear and denim. Tommy Hilfiger is also doing well in its key areas. We believe the company is gaining confidence in its ability to target the right consumers and use its marketing and product innovations to attract them.” He also said PVH is selling more units at full price, seeing growth in “leading indicator” channels like e-commerce and could buy back over 10 percent of its stock over the next four to six months. Tom Nikic, an analyst at Needham, said the PVH story remains “noisy” with “more volatility in the business than we’ve been seeing from other global apparel brands — Ralph Lauren Corp., Levi Strauss & Co., etc.” “That said, the stock is trading at just a 6-times price-to-earnings ratio, which we think is an overly punitive multiple, and skews risk/reward favorably if some headwinds flip to tailwinds — e.g. if Europe, the Middle East and Africa trends improve.” On a conference going over results with analysts, Larsson said: “Calvin Klein and Tommy Hilfiger revenues were in line with expectations with consistent year-over-year revenue performance, excluding the impacts of wholesale shipment timing. We continue to drive momentum in our direct-to-consumer business, led by growth in both Asia-Pacific and Americas, while the wholesale business was impacted by the tough macro environment in Europe. “We beat our guidance on all elements of profitability,” he said. “Importantly, our gross margins, excluding tariff refunds, improved year-over-year and were above expectations. We continue to lean into our strong cost discipline while remaining committed to a balanced approach to investments that prioritize brand building in support of the PVH+ plan.” Best of WWD Harvey Nichols Sees Sales Dip, Losses Widen in Year Marred by Closures Nike Logs $1.3 Billion Profit, But Supply Chain Issues Persist Zegna Shares Start Trading on New York Stock Exchange Sign up for WWD's Newsletter. For the latest news, follow us on Facebook, Twitter, and Instagram.

Interested in PVH Corp.? Here are five stocks we like better. PVH met or exceeded its second-quarter guidance: Revenue fell 3% to the high end of guidance, while adjusted EPS reached $3.70 and operating margin was 11.1%. However, results included $107 million in tariff refunds, adding about $1.80 to EPS; excluding the refunds, operating margin was approximately 6%. Regional demand remained mixed: Americas revenue declined 1% and Asia-Pacific grew 3%, supported by direct-to-consumer and e-commerce strength, while EMEA revenue fell 6% due to weak consumer demand and geopolitical pressures. European wholesale remained particularly challenged, with the spring 2027 order book down mid-single digits. PVH reaffirmed its full-year outlook for roughly flat reported revenue, an 8.8% operating margin and adjusted EPS of $11.80–$12.10. The company also plans at least $300 million in share repurchases, identified approximately $45 million in annualized cost savings, and recorded a $439 million non-cash goodwill impairment charge. Tapestry Stock Drops After Strong Quarter and Raised Outlook PVH (NYSE:PVH) reported second-quarter 2026 revenue and profit that met or exceeded its guidance, as direct-to-consumer and e-commerce strength in the Americas and Asia-Pacific helped offset continued weakness in European wholesale markets. Revenue declined 3% on both a reported and constant-currency basis, landing at the high end of the company’s reported guidance, according to Interim Chief Financial Officer Melissa Stone. Operating margin was 11.1% and adjusted earnings per share totaled $3.70, both ahead of expectations. → Boarding Call: EHang Secures First-Mover Altitude After a Huge Rally, Is There Any Upside Left for Ralph Lauren Stock? The quarter included $107 million in tariff refunds, which added approximately 510 basis points to gross margin and about $1.80 per share to earnings. Excluding the refunds, PVH said operating margin was 6% and gross margin improved about 20 basis points from a year earlier. Americas revenue fell 1%, while direct-to-consumer revenue increased slightly and e-commerce rose high single digits. Wholesale revenue declined low single digits, reflecting the timing of certain Calvin Klein shipments into the second half of the year, partially offset by higher Tommy Hilfiger wholesale revenue tied to licensing transitions in North America. → Medtronic’s Stars Are Aligning for a Price Recovery Calvin Klein's Parent May Be the Market's Best Bargain Asia-Pacific revenue increased 3% as reported and 1% in constant currency. Direct-to-consumer sales grew low single digits in constant currency, led by stores, while wholesale revenue declined mid-single digits as partners remained cautious. E-commerce was down slightly for the region, though PVH said it remains on track for full-year growth. China e-commerce grew mid-single digits in constant currency. In Europe, Middle East and Africa, revenue declined 6% in reported and constant currency, as lower consumer demand and the direct and indirect effects of the conflict in the Middle East pressured the business. Direct-to-consumer sales were down low single digits in constant currency, an improvement from the first quarter, while e-commerce grew mid-single digits across both Calvin Klein and Tommy Hilfiger. Wholesale revenue fell high single digits. → Dutch Bros Sell-Off Creates a Growth Opportunity Chief Executive Officer Stefan Larsson said European wholesalers remain cautious following a difficult spring season. PVH’s spring 2027 European wholesale order book is down mid-single digits, he said. The company is working with key accounts on assortments and plans to increase in-season replenishment of best-selling products. Tommy Hilfiger revenue was flat, including an approximately three-percentage-point benefit from the wholesale sell-in of previously licensed women’s categories in the Americas. Excluding that transition, Tommy Hilfiger revenue declined about 3%. Calvin Klein revenue declined 7%, including an approximately four-percentage-point impact from the timing of wholesale shipments in the Americas. Excluding the timing effect, Calvin Klein revenue also declined about 3%. PVH said its direct-to-consumer business was supported by stronger traffic and higher average unit retail, or AUR, in key markets. Calvin Klein denim sales in direct-to-consumer channels rose double digits globally across men’s and women’s products, with women’s jeans producing double-digit AUR growth. Tommy Hilfiger’s direct-to-consumer sales benefited from double-digit sweater growth and mid-single-digit gains in shirts and polos. Linen sales rose more than 30% across regions, the company said. Larsson highlighted the company’s marketing efforts, including a Jungkook product collaboration for Calvin Klein that generated 5 billion in social-media reach, triple-digit e-commerce traffic growth compared with the spring brand campaign, and more than 90% global sell-through. PVH also recently launched Calvin Klein denim campaigns with Tate McRae and Sadie Sink, while Tommy Hilfiger’s fall campaign features Travis Kelce. The company has completed more than 120 store refurbishments and relocations and more than 130 store openings year to date. It also plans further investments in e-commerce, stores and shop-in-shop renovations. Second-quarter gross margin was 63%, up 530 basis points from the prior year including the tariff refunds. Excluding those refunds, the improvement reflected lower product costs, favorable foreign exchange and channel mix, partially offset by a more promotional environment in EMEA, higher tariff costs net of mitigation efforts, and North American licensing transitions. Inventory declined 3% from a year earlier and was lower across all regions. Stone said the company entered the fall and holiday seasons with healthy core-product levels and improved stock freshness. Inventory is expected to increase year over year in the third quarter to support wholesale shipments in the Americas that are weighted toward the second half. PVH said it has identified approximately $45 million in annualized run-rate savings through centralized indirect procurement and enterprise-wide spending controls. A portion of the savings is expected in 2026, with full realization anticipated in 2027. Selling, general and administrative expense increased 240 basis points to 51.9% of revenue, partly reflecting an 80-basis-point increase in marketing investment. PVH expects full-year marketing spending to rise by at least 50 basis points to about 6% of sales. PVH reaffirmed its full-year outlook for approximately flat reported revenue and a slight constant-currency revenue decline, operating margin of about 8.8%, and adjusted EPS of $11.80 to $12.10. The outlook includes the second-quarter tariff-refund benefit. Third-quarter revenue is projected to decline low single digits in reported and constant currency. Third-quarter operating margin is expected to be about 7.5%. Third-quarter EPS is expected to range from $2.50 to $2.65. PVH expects to repurchase at least $300 million of shares and spend about $250 million on capital expenditures during 2026. The company also recorded a $439 million non-cash goodwill impairment charge on a GAAP basis, citing changes in valuation assumptions related to geopolitical and macroeconomic factors. PVH announced that Alexis Rollier, its incoming chief financial officer, has joined the company and is expected to lead the third-quarter earnings call with Larsson. Rollier most recently served as global CFO and COO at Sephora. PVH Corp is a leading global apparel company known for its portfolio of iconic brands in the dress shirt, sportswear and lifestyle categories. The company designs, markets and distributes clothing, accessories and fragrances under both owned and licensed brands. PVH's core brand holdings include Calvin Klein and Tommy Hilfiger, complemented by a range of heritage labels such as Van Heusen, IZOD, ARROW, Warner's and Olga. PVH's operations span the entire value chain from product design and development to manufacturing, marketing and distribution. 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 "PVH Q2 Earnings Call Highlights" was originally published by MarketBeat. View MarketBeat's top stocks for September 2026.

PVH Corp. PVH posted second-quarter fiscal 2026 adjusted earnings of $3.70 per share, up 46.8% from $2.52 a year earlier and 20.1% above the Zacks Consensus Estimate of $3.08. The result included an approximately $1.80-per-share benefit from tariff refunds.Revenues fell 3.2% year over year to $2.097 billion and were in line with the consensus mark. Owned and operated digital commerce revenues rose 4% year over year, while gross margin benefited from tariff refunds and lower product costs. Over the past three months, shares of this Zacks Rank #3 (Hold) stock have lost 7.5% compared with the industry’s 0.8% decline. Europe, the Middle East and Africa revenues declined 6% year over year to $986.3 million, with weakness primarily stemming from the wholesale channel. The region continued to face soft consumer demand related to the prolonged effects of the Middle East conflict and broader macroeconomic pressures. Direct-to-consumer digital growth was more than offset by lower store revenues.Americas revenues slipped 1% year over year to $680.1 million as a slight DTC increase was outweighed by lower wholesale sales. Asia-Pacific revenues rose 3% year over year to $343.7 million, or 1% at constant currency, on DTC growth. Licensing revenues fell 13% to $86.9 million due to planned North America license transitions. PVH Corp. price-consensus-eps-surprise-chart | PVH Corp. Quote Tommy Hilfiger revenues were approximately flat year over year at $1.132 billion, including an approximately 3% lift from bringing previously licensed women’s categories in-house in the Americas. Calvin Klein revenues fell 7% to $913.3 million, including an approximately 4% drag from wholesale shipment timing in the Americas.The Zacks Consensus Estimate for Tommy Hilfiger and Calvin Klein revenues is pegged at $1.108 billion and $953 million, respectively, for the second quarter of fiscal 2026.By channel, DTC revenues were approximately flat year over year. Owned and operated store revenues fell 1%, while digital commerce advanced 4%, or 3% at constant currency. Wholesale revenues declined 6% across all regions. Gross margin increased 530 basis points to 63% from 57.7%. The expansion included about 510 basis points from $107 million of tariff refunds. The remaining improvement reflected lower product costs, including favorable foreign exchange and a better mix, partly offset by promotions in EMEA, higher net tariff costs and North America license transitions.Adjusted EBIT rose 30.5% to $232.6 million from $178.2 million, lifting adjusted operating margin by 290 basis points year over year to 11.1% from 8.2%. Adjusted SG&A expenses increased 1.7% to $1.1 billion. PVH continued targeted marketing and brand-building investments while maintaining cost discipline. Inventory decreased 3% year over year to $1.7 billion. PVH ended the quarter with $965.9 million in cash and cash equivalents, up from $248.8 million a year earlier. Long-term debt totaled $2.2 billion, while stockholders’ equity was $4.8 billion.Net cash provided by operating activities reached $336.4 million in the first six months of fiscal 2026, up from $141.7 million a year earlier. Capital expenditures totaled $76 million. The company made no common stock repurchases under its repurchase program in the first six months and expects at least $300 million of repurchases for fiscal 2026. For fiscal 2026, PVH continues to expect revenues to be approximately flat on a reported basis and down slightly at constant currency. Adjusted operating margin is still projected at approximately 8.8%, while adjusted earnings are forecast at $11.80-$12.10 per share compared with $11.40 a year ago. The outlook includes an estimated 40-cent favorable foreign-currency impact.For the third quarter, revenues are projected to decline in the low single digits, with an adjusted operating margin of about 7.5%. Adjusted earnings are expected at $2.50-$2.65 per share, down from $2.83 recorded in the prior-year period. Management also plans higher year-over-year marketing investment in the fiscal third quarter to aid growth. Duluth Holdings Inc. DLTH, which deals in casual wear, workwear and accessories for men and women, currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here. Duluth Holdings delivered a trailing four-quarter earnings surprise of 107.5%, on average. The Zacks Consensus Estimate for DLTH’s current financial-year EPS indicates a rise of 39.5% from the year-ago number. Columbia Sportswear COLM engages in marketing and distribution of outdoor and active lifestyle apparel, footwear and accessories, and currently has a Zacks Rank #2 (Buy).The Zacks Consensus Estimate for COLM’s current financial-year sales is expected to rise 1.9% from the corresponding year-ago reported figure. COLM delivered a trailing four-quarter earnings surprise of 36%, on average.Ralph Lauren Corporation RL, which is a designer and marketer of premium lifestyle products, currently carries a Zacks Rank of 2. RL delivered a trailing four-quarter earnings surprise of 8.7%, on average. The Zacks Consensus Estimate for Ralph Lauren’s current financial-year sales indicates growth of 7.6% from the year-ago number. 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 PVH Corp. (PVH) : Free Stock Analysis Report Columbia Sportswear Company (COLM) : Free Stock Analysis Report Ralph Lauren Corporation (RL) : Free Stock Analysis Report Duluth Holdings Inc. (DLTH) : 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. Achieved revenue targets and exceeded profitability expectations by focusing on 'hero' categories like Calvin Klein denim and Tommy Hilfiger sweaters, which saw double-digit growth. Drove momentum in Direct-to-Consumer (D2C) channels across the Americas and APAC, utilizing pricing power to expand Average Unit Retail (AUR) and gross margins. Navigated a challenging European macro environment where wholesale remains under pressure due to regional conflict and cautious retailer sentiment. Successfully executed high-profile global marketing collaborations, such as the Jung Kook for Calvin Klein campaign, which achieved over 90% global sell-through and 5 billion social media reach. Implemented a systematic, enterprise-wide cost management program targeting approximately $45 million in annualized run-rate savings by 2027. Maintained disciplined inventory management with levels down 3% year-over-year, ensuring stock freshness heading into the peak fall and holiday seasons. Reaffirmed full-year 2020 guidance, projecting flat reported revenue and operating margins of approximately 8.8%, inclusive of one-time tariff refunds. Expects continued D2C and e-commerce growth across all regions for the full year, while anticipating EMEA wholesale to remain down mid-single digits through Spring 2025. Anticipates Q3 gross margin expansion of approximately 100 basis points driven by lower product costs and higher AURs from new fall product launches. Planned a strategic shift in marketing spend into Q3 to maximize impact around key consumer moments, resulting in higher SG&A deleverage for the quarter. The transition of the North America women's wholesale business is expected to be substantially complete by the end of 2020, setting the stage for licensing growth in 2027. Recognized a non-cash goodwill impairment charge of $439 million due to changes in valuation assumptions linked to macroeconomic and geopolitical factors. Received $107 million in tariff refunds during Q2, which contributed 510 basis points to operating margin and $1.80 to EPS. Flagged potential Q4 gross margin pressure due to a higher mix of wholesale shipments and the need for flexibility in a potentially promotional holiday landscape. Monitoring newly announced tariff rates and fluid geopolitical developments as ongoing risks to the global supply chain and cost structure. One stock. Nvidia-level potential. 30M+ investors trust Moby to find it first. Get the pick. Tap here. Management reported a 14% social engagement rate for the Sadie Sink campaign and a 500% increase in Instagram views for Tommy Hilfiger following the Travis Kelce launch. Strategic focus on 'status shoppers' and 'style enthusiasts' is driving high-quality consumer acquisition, with 96% of recent campaign views coming from non-followers. To counter a mid-single-digit decline in Spring 2025 orders, PVH is shifting toward more in-season replenishment, which now accounts for nearly 50% of wholesale sales. Management is using D2C data insights to help wholesale partners curate more relevant, high-turnover assortments in core categories like denim and knitwear. Incoming CFO Alexei Rossignol will prioritize scaling the new cost-discipline culture to drive significant profit expansion starting in 2027. The focus will remain on balancing consumer-facing brand investments with operational efficiency to leverage the full scale of the PVH platform.

This article first appeared on GuruFocus. Revenue: Decreased 3% in both reported and constant currency, at the high end of guidance. Gross Margin: 63%, up 530 basis points year-over-year, including tariff refunds; excluding refunds, up approximately 20 basis points. Operating Margin: 11.1%, including a 510 basis point benefit from tariff refunds; excluding refunds, 6%. Earnings Per Share (EPS): $3.70, including an approximately $1.80 benefit from tariff refunds, compared to $2.52 last year. EBIT: $233 million, including the $107 million tariff refund benefit, compared to $178 million in the prior year. SG&A: Increased 240 basis points to 51.9% of revenue, but was better than planned. Inventory: Down 3% versus last year, lower in all regions. Americas Revenue: Down 1%, with DTC up slightly and e-commerce up high single digits. APAC Revenue: Up 3% reported and up 1% in constant currency, with DTC growth led by stores. EMEA Revenue: Down 6% in both reported and constant currency, with wholesale down high single digits. Tommy Hilfiger Revenue: Flat in both reported and constant currency; excluding transition impact, down approximately 3%. Calvin Klein Revenue: Down 7% in both reported and constant currency; excluding timing impact, down approximately 3%. Direct-to-Consumer Revenue: Flat in reported and constant currency, with e-commerce up 4% reported and 3% in constant currency. Wholesale Revenue: Down 6% in both reported and constant currency. Licensing Revenue: Down 13% due to North America license transitions; excluding transitions, grew low single digits. Warning! GuruFocus has detected 7 Warning Sign with WLY. Is PVH fairly valued? Test your thesis with our free DCF calculator. Release Date: September 03, 2026 For the complete transcript of the earnings call, please refer to the full earnings call transcript. PVH Corp (NYSE:PVH) beat its profitability guidance for Q2 2026, with gross margins expanding year-over-year excluding tariff refunds and EPS of $3.70 exceeding expectations. The company is seeing strong momentum in its direct-to-consumer (D2C) and e-commerce channels, with e-commerce traffic up double digits for Calvin Klein and high single digits for Tommy Hilfiger, and e-commerce revenue growing 4%. PVH Corp (NYSE:PVH) is successfully driving growth in key product categories, such as Calvin Klein Denim (double-digit growth) and Tommy Hilfiger sweaters (double-digit growth), with strong AUR expansion and consumer response to new campaigns. The company has identified and is executing on cost-saving initiatives, confirming annualized run-rate savings of approximately $45 million, which will contribute to profitability in 2026 and 2027. PVH Corp (NYSE:PVH) is making progress on its licensing transition, with the go-forward licensing portfolio growing low single digits and expected to return to overall growth by 2027, supported by strategic partnerships. Inventory levels are well managed, down 3% year-over-year, with improved stock freshness, positioning the company well for the fall and holiday seasons. The company is investing in high-impact marketing campaigns with top talent (e.g., Travis Kelce, Tate McRae), which are driving strong consumer engagement, social media reach, and early positive responses, indicating a strong ROI. PVH Corp (NYSE:PVH) reaffirmed its full-year guidance, demonstrating confidence in its strategic plan despite a dynamic macro environment, with expectations for growth in the Americas and APAC. The company is seeing strong performance in APAC, with D2C growth led by stores and better-than-expected gross margin performance, indicating resilience in that region. PVH Corp (NYSE:PVH) is upgrading its marketplace experience with over 120 store refurbishments and 130 new store openings year-to-date, enhancing the consumer shopping experience. PVH Corp (NYSE:PVH) experienced a 3% decline in total revenue for Q2 2026, with revenue in EMEA down 6% due to a challenging macro environment and the impact of the Middle East conflict. The wholesale channel remains under pressure, particularly in Europe, with the Spring '27 order book down mid-single digits as wholesalers remain cautious. The company's operating margin, excluding tariff refunds, was only 6% in Q2, down from 8.2% in the prior year, indicating underlying profitability challenges. PVH Corp (NYSE:PVH) recorded a non-cash goodwill impairment charge of $439 million in Q2, reflecting changes in valuation assumptions due to geopolitical and macroeconomic factors. The company faces ongoing uncertainty from tariff rates, which could impact future margins, and it has embedded support for volatility in its guidance. SG&A expenses increased 240 basis points to 51.9% of revenue, driven by higher marketing investments and deleverage on lower revenue, which pressures profitability. The licensing business revenue declined 13% in Q2 due to the North America license transitions, which are expected to continue impacting results through the end of 2026. In EMEA, D2C revenue declined low single digits in constant currency, and the company expects continued revenue declines in the region for Q3, with wholesale also down. The company's full-year revenue is expected to be approximately flat on a reported basis and down slightly on a constant currency basis, indicating limited top-line growth. Q4 gross margin is expected to be lower due to channel mix effects, potential promotional activity, and tariff uncertainty, which could weigh on profitability. Q: Can you discuss the trends in Europe, the underlying demand for the brands, and what actions you are taking to mitigate the cautious wholesale environment, particularly regarding the Spring '27 order book?A: Stefan Larsson (CEO) stated that Q2 performance in Europe was consistent with expectations, with e-commerce growth increasing and D2C trends improving versus Q1. He acknowledged that European wholesalers are cautious due to the Middle East conflict and a tough spring season, reflected in a mid-single-digit decline in the Spring '27 order book. To mitigate this, PVH is working more closely with key accounts on a granular level, curating stronger assortments focused on key growth categories and franchises, and providing more in-season replenishment of best-selling products. He emphasized that the consumer love for the brands remains strong in the region. Q: Can you provide more detail on the marketing ROI you are seeing from the high-profile campaigns, and how are you balancing the increased investment with cost discipline?A: Stefan Larsson (CEO) highlighted strong leading indicators, including double-digit e-commerce traffic growth for Calvin Klein and high single-digit for Tommy Hilfiger, and strong consumer acquisition targeted at the "Power segment." He cited specific examples like the John Cook collaboration, which drove $5 billion in social media reach and over 90% sell-through, and the new Tate McRae and Travis Kelce campaigns, which are generating high engagement and traffic. Melissa Stone (Interim CFO) added that the full-year marketing investment is expected to increase by at least 50 basis points to 6% of sales, with spending rebalanced between Q3 and Q4 to create a consistent drumbeat into the peak season. Q: How is the North America licensing transition progressing, and what is the growth outlook for the go-forward licensing portfolio?A: Stefan Larsson (CEO) confirmed that the transition of the women's wholesale business in North America is on plan and expected to be substantially complete by the end of 2026. He emphasized that the underlying go-forward licensing portfolio is already growing, driven by long-term brand-building partners. With the transition concluding, the company expects to grow its overall licensing business starting in 2027, leveraging the strength of its core brand expression and complementing it with partner expertise. Q: What are the key priorities for the new CFO, Alexis Rollier, and how is the U.S. consumer and pricing power trending?A: Stefan Larsson (CEO) stated that Alexis Rollier's key priority will be to lead the increased focus on cost efficiency and drive significant improvements on the cost side for 2027, while also supporting the consumer-facing growth initiatives. Regarding the U.S. consumer, Larsson described them as "very resilient," noting that the company is seeing strong responses and pricing power in areas where it focuses on key categories and franchises, delivering great value through brand relevance and the right price. Q: Given the noise from tariff refunds, wholesale timing shifts, and licensing transitions, what is a starting point for how operating margins should trend in 2027?A: Stefan Larsson (CEO) declined to give specific 2027 guidance but stated that the company is "significantly leaning into" cost as a real driver of EBIT margin expansion. He indicated that the effects of these cost initiatives, including the confirmed annualized run-rate savings of approximately $45 million, will be more visible in 2027. Melissa Stone (Interim CFO) also addressed Q4 gross margin, explaining that the full-year guidance implies a lower gross margin in Q4 due to channel mix effects from wholesale shipment timing, flexibility for promotional activity, and uncertainty around tariff rates. Q: Can you elaborate on the strategy for "hero" products versus fashion items for the back half of the year?A: Stefan Larsson (CEO) explained that the strategy combines iconic strength with fresh, current fashion. He noted that while the company has strong authority in categories like underwear and denim, the business in denim is smaller than its right to play. By making iconic products like Calvin Klein denim more current, the company is driving double-digit growth and AUR expansion. This approach is applied across brands, such as Tommy Hilfiger's focus on sweaters and cable knits, ensuring products are both iconic and fashionable. Q: What is driving the D2C growth in the Americas and APAC, and how are you managing the wholesale channel in EMEA?A: Stefan Larsson (CEO) attributed D2C growth to increased brand relevance, targeted marketing toward Gen Z and young millennials, and a sharpened focus on key categories with newness and innovation. In EMEA, the company is working hand-in-hand with its best wholesale partners, using consumer insights to ensure enough newness in key categories like denim and underwear. He stressed that in-season replenishment will become increasingly important to compensate for cautious forward-looking orders, and that the company is preparing to replenish best sellers effectively. Q: Can you provide more detail on the Q3 and Q4 gross margin expectations and the factors influencing them?A: Melissa Stone (Interim CFO) stated that Q3 gross margin is expected to increase approximately 100 basis points, with expansion in all regions, driven by lower product costs, higher AURs, and favorable channel mix. For Q4, the full-year guidance implies a lower gross margin due to three factors: a channel mix effect from the timing of North America wholesale shipments, flexibility to support a promotional holiday landscape if necessary, and continued uncertainty around tariff rates. She noted this is a prudent approach given the dynamic operating environment. Q: How are you driving growth in the D2C channel in Europe, and what is the strategy for working with wholesale partners there?A: Stefan Larsson (CEO) explained that in Europe, e-commerce is up and D2C trends improved in Q2 versus Q1, driven by the same factors as other regions: increased brand relevance and focus on key categories. He emphasized that the company is working more closely than ever with key accounts, curating stronger assortments and providing more in-season replenishment of best-selling products. By leveraging insights from its own D2C business, PVH aims to better serve its wholesale partners and mitigate the challenging macro environment. Q: Can you elaborate on the cost management actions and the expected savings, and how are you balancing this with brand-building investments?A: Stefan Larsson (CEO) detailed two main approaches: globalizing and centralizing indirect procurement to leverage PVH's scale, and driving For the complete transcript of the earnings call, please refer to the full earnings call transcript.