Columbia Sportswear Company Chairman and CEO Tim Boyle used terms like “encourage” and “excited” in his review of the company’s fourth quarter 2025 business during a conference call with analysts as he talked about a business that delivered net sales and profitability that exceeded guidance for the fourth quarter, driven by better-than-expected demand in the U.S.

Still, the U.S. business remains challenged, Boyle noted, but he also sounded a positive tone about continued international growth and early signs of momentum, indicating that the Columbia Accelerate growth strategy is resonating with consumers, including new and enhanced product collections and differentiated marketing.

On the top line, Boyle noted  that international growth was “strong and broad-based,” reflecting both Wholesale and DTC growth.

Inventories were said to be “healthy and essentially flat” at year-end, inclusive of increased tariff costs in the U.S.

He said the SG&A growth rate has slowed as the company optimizes spending to increase marketing spend and drive engagement and demand. And the company continues to maintain its “fortress balance sheet,” exiting the year with $791 million in cash and equivalents and no debt.

However, Boyle was quick to note that the year’s performance fell short of his personal growth and profitability goals.

Full year net sales increased 1 percent (1 percent on a constant-currency basis) to $3.40 billion from $3.37 billion in 2024, driven by international growth that was “mostly offset” by continued headwinds in the U.S. Full year net income decreased 21 percent to $177.2 million, or $3.24 per diluted share as impairment charges related to Prana and Mountain Hardwear negatively impacted diluted earnings per share by 45 cents for the year 2025.

“The impact of unmitigated tariffs, brand impairments and increased marketing spend contributed to operating margin contraction and a decline in earnings,” the CEO shared.

Looking ahead, Boyle said the company sees positive indicators across its brands, and its initial full-year net sales outlook “contemplates” growth of 1 percent to 3 percent versus 2025 results.

One analyst noted post-call that Columbia’s “FY26 outlook points to sequentially strengthening fundamentals, with topline growth poised to inflect on improving U.S. selling conditions, high-single-digit price increases embedded in the order book, and contributions across all brands.”

That analyst’s increased estimates for sales and EPS for fiscal 2026 and fiscal 2027, along with an increase in Columbia’s price target, may be one reason COLM shares closed up 14.4 percent on Wednesday, February 4.

Product is one clear reason for the growth in the order book. Rarely does a strategic marketing plan like Accelerate post results in ways other than the top- and bottom line, but the focus and execution on product was on full display during the fall/winter season with the Columbia brand’s new Amaze Puff collection (pictured above) that looks to reflect a new brand conversation. Many questioned whether the Columbia brand could go younger in its marketing and product approach, but the market and the company are seeing that it is indeed possible. Amaze Puff and the brand’s new Engineered for Whatever marketing campaign have clearly changed the conversation around the Columbia brand.

“For the Columbia brand, the Amaze Puff collection was an outstanding success for fall 2025,” Boyle commented. “For Spring 2026, we introduced a seasonally appropriate Amaze collection. We’re also excited about the potential of the ROC Pant program and recently launched the ROC Lite series.”

He continued, “Throughout our Spring 2026 offering, we have invested in a diverse range of new styles across apparel and footwear from high-performance hiking, fishing and trail running products to contemporary outdoor lifestyle products, designed to resonate with consumers in the outdoor communities that we serve.”

Boyle said a key highlight for Spring 2026 is OutDry Extreme, a patented technology that checks the sustainability box with a base material made from recycled textiles while delivering “industry-leading waterproofness in a post-PFAs world.”

Fourth Quarter Summary – Constant-Currency Basis
Fourth quarter 2025 net sales decreased 2 percent year-over-year (y/y) to $1.1 billion, driven by a 7 percent decrease in Wholesale net sales, partially offset by a 1 percent increase in direct-to-consumer (DTC) sales. Boyle reminded the call participants that earlier-than-planned shipments of fall 2025 orders shifted some Wholesale sales to earlier in 2025.


U.S. Region
U.S. net sales decreased 8 percent y/y. The U.S. Wholesale business was said to be down in the high teens, reflecting earlier shipments of fall Wholesale channel orders from a lower order book.

“Results were partially impacted by inventory supply constraints as we curtailed fall 2025 inventory purchases as a precautionary measure upon U.S. tariff announcements earlier in the year,” Boyle noted.

U.S. DTC net sales declined by low single digits in the quarter. Brick-and-mortar (B&M) was down in low single digits, “reflecting the closure of temporary clearance locations and lower mall traffic, partially offset by higher productivity from existing stores and contribution from new stores.” Boyle said they exited the quarter with 8 temporary clearance locations, down from 28 in the prior year.

E-commerce was also down in low single digits as “soft traffic and less clearance and promotional activities” were partially offset by ongoing efforts to refine marketing investments for the Columbia brand.

“We saw modest sales growth in the Columbia brand, offset by declines in emerging brands,” Boyle shared. He said improved photography on the redesigned uscolumbia.com website helped to drive discovery and engagement.

Latin America Asia Pacific (LAAP) Region
LAAP net sales increased 10 percent in constant currency (cc) terms.

China net sales increased in the low double digits in constant currency terms, said to be driven by wholesale and e-commerce growth despite the impact of warm weather on demand for seasonal products. Boyle said the outdoor category remains “robust” in China.

Japan net sales increased in the high single digits, reflecting increased fall 2025 wholesale shipments shifting into the fourth quarter. Boyle said the Japan business remains healthy despite declines in tourism and lower domestic consumer sentiment. Omni-Heat Infinity outerwear and winter boots reportedly performed well during the quarter.

Korea net sales increased in low single digits, driven by wholesale and e-commerce, as Columbia gained share in a soft outdoor category. Boyle pointed to execution across brand and marketing initiatives that drove digital sales with improvements in both conversion and marketing efficiency during the quarter.

LAAP distributor markets delivered growth in the high teens, reportedly driven by a strong spring 2026 order book.

Europe, Middle East & Africa Region
EMEA net sales increased 3 percent y/y. Europe-direct net sales increased slightly as growth in B&M retail was partially offset by lower Wholesale sales, reflecting earlier shipments of fall Wholesale orders. Boyle said warm weather across Europe dampened consumer demand for cold-weather products. Still, he said Europe offers strong growth potential, and the company is determined to capitalize on brand momentum and drive broader awareness, led by younger active consumers.

The EMEA distributor business increased in the low teens y/y, reflecting a healthy order book for spring 2026.

Canada Region
Canada net sales increased 3 percent y/y in the fourth quarter, reportedly driven by improved store productivity in DTC and wholesale growth.

Emerging Brands
Boyle noted that the company’s Emerging Brands derive almost all their revenue from the U.S. marketplace. He also said Sorel and Mountain Hardwear faced heavily promoted PFAs inventory sales in the fourth quarter 2024 in advance of U.S. regulatory deadlines, which impacted the two brands’ year-over-year comparisons.

Sorel net sales decreased 18 percent y/y in the fourth quarter, reportedly due to earlier shipments of fall wholesale orders and lower clearance activity. Full-price demand for the brand was said to be healthy, with demand exceeding supply for key styles. In e-commerce, he said the brand continues to acquire new consumers and drive strong traffic.

Prana net sales increased 6 percent, driven by DTC, reflecting strong momentum for the brand’s updated product offering, supported by advanced full-funnel marketing.” Our team has been successfully expanding the Prana marketplace by targeting more lifestyle fitness accounts and the active original consumer more broadly. We’re very encouraged by positive sales trends in Shay Soft and women’s seasonal products during the quarter.”

Mountain Hardwear net sales decreased 5 percent y/y in the fourth quarter, driven by lower clearance and promotional activity compared with elevated levels in the prior-year Q4 period. Boyle said underlying business trends were healthy, with notable strength in outerwear and fleece, led by the Summit Grid franchise.

“Ongoing optimization of Mountain Hardwear’s full-funnel advertising approach drove online traffic during the quarter,” Boyle said. “Additionally, branded in-store environments are continuing to deliver strong results and are poised for growth next year based on the current order book and planned door expansion.”

Fourth Quarter Profitability & Expenses Summary
Gross margin expanded 50 basis points to 51.6 percent of net sales in Q4, compared to 51.1 percent of net sales for the comparable period in 2024. Gross margin expansion was driven by a healthier inventory composition, resulting in less clearance and promotional activity, as well as lower inventory loss provisions, partially offset by the impact of incremental U.S. tariffs. Incremental U.S. tariffs prior to mitigation actions impacted gross margin by $20.0 million.

SG&A expenses were $441.5 million, or 41.3 percent of net sales, compared to $430.6 million, or 39.3 percent of net sales, for the comparable period in 2024. The largest changes in SG&A expenses were driven by higher DTC expenses and other non-recurring SG&A expenses associated with the company’s profit improvement program, partially offset by lower enterprise technology and supply chain expenses, largely due to the program.

Operating income decreased 15 percent to $116.7 million, or 10.9 percent of net sales, compared to operating income of $137.3 million, or 12.5 percent of net sales, for the comparable period in 2024.

Interest income, net of $3.3 million, compared to $4.8 million for the comparable period in 2024.

Income tax expense of $27.2 million resulted in an effective income tax rate of 22.6 percent, compared to $37.3 million, or an effective income tax rate of 26.7 percent, for the comparable period in 2024.

Net income was $93.2 million, or $1.73 per diluted share, compared to net income of $102.6 million, or $1.80 per diluted share, for the comparable period in 2024.

Full Year 2025 Financial Results – Constant-Currency Basis

Net sales increased 1 percent (1 percent on a constant-currency basis) to $3.40 billion from $3.37 billion in 2024.

  • Gross margin expanded 30 basis points to 50.5 percent of net sales from 50.2 percent of net sales in 2024. Incremental U.S. tariffs prior to mitigation actions impacted gross margin by $31.0 million.
  • SG&A expenses were $1,502.5 million, or 44.2 percent of net sales, compared to $1,443.9 million, or 42.9 percent of net sales in 2024.
  • Impairment of goodwill and intangible assets included $29.0 million of charges related to Prana and Mountain Hardwear.
  • Operating income decreased 24 percent to $207.0 million, or 6.1 percent of net sales, compared to operating income of $270.7 million, or 8.0 percent of net sales in 2024.
  • Interest income, net of $17.9 million, compared to $27.7 million in 2024.
  • Income tax expense of $52.4 million resulted in an effective income tax rate of 22.8 percent, compared to $74.9 million, or an effective income tax rate of 25.1 percent, in 2024.
  • Net income decreased 21 percent to $177.2 million, or $3.24 per diluted share, compared to net income of $223.3 million, or $3.82 per diluted share, in 2024. The impairment charges related to Prana and Mountain Hardwear negatively impacted diluted earnings per share by 45 cents in 2025.

Balance Sheet as of December 31, 2025

  • Cash, cash equivalents, and short-term investments totaled $790.8 million, compared to $815.5 million as of December 31, 2024.
  • The company had no borrowings as of either December 31, 2025, or December 31, 2024.
  • Inventories were essentially flat at $689.5 million, compared to $690.5 million as of December 31, 2024.

Cash Flow for the Twelve Months Ended December 31, 2025

  • Net cash provided by operating activities was $282.9 million, compared to $491.0 million in 2024.
  • Capital expenditures totaled $66.2 million, compared to $59.8 million in 2024.

Share Repurchases for the Twelve Months Ended December 31, 2025

  • The company repurchased 2,972,889 shares of common stock for an aggregate of $201.1 million, or an average price per share of $67.64.
  • At December 31, 2025, $426.5 million remained available under the company’s stock repurchase authorization, which does not obligate the company to acquire any specific number of shares or to acquire shares over any specified period.

Quarterly Cash Dividend
The Board of Directors approved a regular quarterly cash dividend of 30 cents per share, payable on March 20, 2026, to shareholders of record on March 9, 2026.

Full Year 2026 Financial Outlook

Net sales are expected to increase 1.0 percent to 3.0 percent, resulting in net sales of $3.43 billion to $3.50 billion for the full year 2026, compared to $3.40 billion in 2025. Foreign currency translation is expected to benefit net sales by approximately 50 to 100 basis points.

“With greater than 80 percent of fall 2026 advance global bookings orders in hand, we project second half global wholesale net sales to increase up to a mid-single-digit percent,” Boyle offered. “We were encouraged that our U.S. wholesale business is expected to return to growth in the second half, including growth from all brands.”

He also noted that retailers remain cautious as tariff-induced price increases are just now beginning to hit the marketplace.

Gross margin is expected to contract by 70 to 50 basis points to a range of 49.8 percent to 50.0 percent of net sales, compared to 50.5 percent in 2025. Gross margin expectations include a roughly 300-basis-point unfavorable impact from incremental tariffs prior to mitigation actions.

“We continue to evaluate and have taken actions to mitigate the financial impact of tariffs through a combination of price increases, vendor negotiations, resourcing production, and other tactics,” the CEO commented.

“For both spring 2026 and fall 2026, we increased U.S. pricing by a high single-digit percent,” he added. “When combined with our other mitigation tactics, our goal in 2026 is to offset the dollar impact of higher tariffs. Longer term, our goal is to restore our product margin percentage to historical levels.”

SG&A expenses, as a percent of net sales, are expected to range between 43.6 percent and 44.2 percent of net sales, compared to SG&A expense as a percent of net sales of 44.2 percent in 2025.

Operating margin is expected to be between 6.2 percent and 6.9 percent of net sales in 2026, compared with 6.1 percent in 2025.

Effective income tax rate is expected to be between 24.0 percent and 25.0 percent.

Diluted earnings per share is expected to be $3.20 to $3.65, compared to $3.23 in 2025.

Operating cash flow is expected to be in the range of $300 million to $330 million.

Capital expenditures are planned at $65 million to $75 million, roughly in line with the company’s run rate over the past several years.

First Quarter 2026 Financial Outlook

Net sales are expected to range between $747 million and $759 million in the 2026 first quarter, representing a decrease of 4.0 percent to 2.5 percent from $778 million for the comparable period in 2025. Foreign currency translation is expected to benefit net sales by approximately 200 basis points.

Operating margin is expected to range between 2.1 percent and 2.9 percent of net sales in Q1, compared to an operating margin of 6.0 percent of net sales in Q1 2025. Operating margin includes SG&A expense deleverage driven by low-single-digit percent SG&A growth on declining net sales, and gross margin contraction primarily due to unmitigated incremental U.S. tariffs.

Diluted earnings per share is expected to be in the 29-cent to 37-cent per share range in the 2026 first quarter, compared to 75 cents per share in Q1 2025.

 Image and tables courtesy Columbia Sportswear Company