Oxford Industries Inc. reported a steeper loss than expected in the third quarter after absorbing an impairment charge for its Johnny Was business. The parent of Tommy Bahama and Lilly Pulitzer also reduced its EPS guidance for the year due  f tariff-related shortages in key  seasonal categories and a more promotional retail environment.

Consolidated net sales in the third quarter were $307 million compared to $308 million in the third quarter of fiscal 2024. Guidance had called for sales in the range of $295 million and $310 million.

Loss per share on a GAAP basis was $4.28 compared to $0.25 in the third quarter of fiscal 2024. Guidance had called for a loss of $1.15 to 95 cents a share. The third quarter of fiscal 2025 GAAP results include noncash impairment charges primarily associated with Johnny Was totaling $61 million, or $3.05 per share.

On an adjusted basis, loss per share was 92 cents compared to 11 cents in the third quarter of fiscal 2024. Adjusted earnings on an adjusted basis per share was expected to be in a range of a loss of $1.05 to $0.85

Tom Chubb, chairman and CEO, commented, “Our third quarter results came in as expected and reflect the disciplined execution across our brands in a highly competitive and promotional environment. While we witnessed pockets of strength within our businesses, consumers have become increasingly choiceful, especially with respect to the more discretionary aspects of their wardrobe. As we entered the holiday season, our customers have been highly value-driven, seeking both compelling promotions and new, innovative products.”

Chubb concluded, “The start of the holiday season has been softer than we planned, influenced by a combination of tariff related product gaps in certain critical seasonal categories and a more promotional retail environment. We are working quickly and taking thoughtful actions to align our assortments and promotional strategies with current consumer preferences and demand patterns. With these adjustments and a more cautious view of the remainder of the year, we now expect full-year performance to be below our prior outlook. Even with these near-term challenges, we remain focused on disciplined inventory and expense management, supporting our strong portfolio of brands, and investing for long-term growth. I want to thank our exceptional team for their continued commitment and hard work.”

Third-Quarter Results

  • Consolidated net sales were $307 million compared to $308 million in the third quarter of fiscal 2024.
  • Full-price direct-to-consumer (DTC) sales increased 3 percent to $206 million versus the third quarter of fiscal 2024.
  • Full-price retail sales of $101 million were 1 percent higher than the prior-year period.
  • E-commerce sales of $106 million were 5 percent higher than the prior-year period.
  • Food and beverage sales of $24 million were 3 percent higher than the prior-year period.
  • Outlet sales of $17 million were comparable to the prior-year period.
  • Wholesale sales of $60 million were 11 percent lower than the third quarter of fiscal 2024.

Gross margin was 60.3 percent, compared to 63.1 percent in the third quarter of fiscal 2024. The decreased gross margin was primarily due to (1) approximately $8 million, or 260 basis points, of increased cost of goods sold from additional tariffs implemented in Fiscal 2025, net of mitigation efforts, (2) a change in sales mix with a higher proportion of net sales occurring during promotional and clearance events at Tommy Bahama and Lilly Pulitzer and (3) a $3 million higher LIFO accounting charge in the third quarter of fiscal 2025 compared to the third quarter of fiscal 2024. On an adjusted basis, gross margin was 61.0 percent compared to 63.0 percent in the third quarter of fiscal 2024.

SG&A was $213 million compared to $205 million last year with approximately $5 million, or 68 percent, of the expenses that increased during the third quarter of fiscal 2025 due to increases in employment costs, occupancy costs and depreciation expense due to the opening of 16 net new brick and mortar retail locations since the third quarter of fiscal 2024. The increase in SG&A also included $2 million of organizational realignment initiatives at Johnny Was including severance costs, consulting fees and store closure related costs. On an adjusted basis, SG&A was $209 million compared to $201 million in the prior-year period.

As a result of interim impairment assessments performed in the third quarter of fiscal 2025, the company recognized noncash impairment charges totaling $61 million, primarily related to the Johnny Was trademark. The impairment charges for Johnny Was reflect revised future projections based on the impact of organizational realignment activities in the third quarter of fiscal 2025 including changes to the Johnny Was executive team, recent negative trends in net sales and operating results and challenges in mitigating elevated tariff rates.

Royalties and other operating income decreased from $4 million to $3 million in the third quarter of fiscal 2025 primarily due to decreased royalty income in Tommy Bahama reflecting the lower sales of licensing partners.

Operating loss on a GAAP basis was $85 million, or (27.7 percent) of net sales, compared to $6 million, or (2.0 percent) of net sales, in the third quarter of fiscal 2024. On an adjusted basis, operating loss was $18 million, or (5.8 percent) of net sales, compared to $3 million, or (1.1 percent) of net sales, in the third quarter of fiscal 2024.

Interest expense increased to $2 million primarily due to a higher average outstanding debt balance during the third quarter of fiscal 2025 than the third quarter of fiscal 2024.

Due to lower earnings during the third quarter as compared to our other fiscal quarters, certain discrete or other items recognized in the third quarter typically have a more pronounced impact and result in the effective tax rate of the third quarter not being indicative of the effective tax rate for the full fiscal year. Noncash impairment charges further reduced earnings in the third quarter of fiscal 2025. For both the third quarter of fiscal 2025 and third quarter of fiscal 2024, our effective tax rate of 26.6 percent and 42.5 percent, respectively, included the net impact of discrete items to the research and development tax credit.

Balance Sheet and LiquidityI
nventory increased $1 million, or 1 percent, on a LIFO basis and $6 million, or 3 percent, on a FIFO basis compared to the end of the third quarter of fiscal 2024. Inventories increased primarily as a result of $4 million of additional costs capitalized into inventory related to the U.S. tariffs implemented in Fiscal 2025.

During the first nine months of fiscal 2025, cash provided by operations was $70 million compared to $104 million in the first nine months of fiscal 2024. The decrease in cash flow from operations reflects the result of lower net earnings and working capital needs.

Borrowings outstanding increased to $140 million at the end of the first nine months of fiscal 2025 compared to $58 million of borrowings outstanding at the end of the third quarter of fiscal 2024 and $31 million of borrowings outstanding at the end of fiscal 2024. During the first nine months of fiscal 2025, share repurchases of $55 million, capital expenditures of $93 million primarily associated with the project to build a new distribution center in Lyons, Georgia, and the opening of 13 new stores, including three Tommy Bahama Marlin Bars and one full-service restaurant, dividend payments of $32 million, and working capital requirements exceeded cash flow from operations. The company had $8 million of cash and cash equivalents versus $7 million of cash and cash equivalents at the end of the third quarter of fiscal 2024.

Dividend
The Board of Directors declared a quarterly cash dividend of $0.69 per share. The dividend is payable on January 30, 2026 to shareholders of record as of the close of business on January 16, 2026. The company has paid dividends every quarter since it became publicly owned in 1960.

Outlook
For fiscal 2025 ending on January 31, 2026, the company is revising its sales and adjusted EPS guidance. The company now expects net sales in a range of $1.47 billion to $1.49 billion compared to previous guidance of  $1.475 billion to $1.515 billion and net sales of $1.52 billion in fiscal 2024.

In fiscal 2025, the company now expects GAAP loss per share to be between $1.52 and $1.32, which includes noncash impairment charges primarily associated with Johnny Was totaling $61 million, or $3.05 per share, compared to previous guidance in the range of $2.35 and $2.75 and fiscal 2024 GAAP earnings per share of $5.87. Adjusted EPS is expected to be between $2.20 and $2.40, compared to previous guidance of $2.80 and $3.20 and fiscal 2024 adjusted EPS of $6.68.

The company’s current annual EPS and adjusted EPS guidance reflect a net tariff impact of approximately $25 million to $30 million, or approximately $1.25 to $1.50 per share. Previously, the net tariff impact was expected to be between approximately $25 million to $35 million, or approximately $1.25 to $1.75 per share.

For the fourth quarter of fiscal 2025, the company expects net sales to be between $365 million and $385 million compared to net sales of $391 million in the fourth quarter of fiscal 2024. GAAP EPS is expected to be between a loss per share of $0.10 to earnings per share of 10 cents a share in the fourth quarter of fiscal 2025 compared to $1.13 in the fourth quarter of fiscal 2024. Adjusted EPS is expected to be in a range of $0.00 to $0.20 compared to $1.37 in the fourth quarter of fiscal 2024.

The company anticipates interest expense of $7 million in fiscal 2025 including $2 million in the fourth quarter of fiscal 2025. The company’s effective tax rate is expected to be approximately 25 percent for the full year of fiscal 2025 and approximately 26 percent for the fourth quarter.

Capital expenditures in fiscal 2025, including the $93 million in the first nine months of fiscal 2025, are expected to be approximately $120 million compared to $134 million in fiscal 2024. The planned year-over-year decrease relates primarily to fewer new store openings in fiscal 2025. By the end of fiscal 2025, we expect a year-over-year net increase of approximately 15 full price stores, including three new Marlin Bars and a full-service restaurant. The $120 million in expected capital expenditures in fiscal 2025 includes $70 million of capital expenditures related to the completion of the project to build a new distribution center in Lyons, Georgia.

Oxford’s Emerging Brands segment includes Southern Tide, The Beaufort Bonnet Company, Duck Head and Jack Rogers.

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