G-III Apparel Group ( GIII ) shares slipped Thursday after the fashion company slashed its full-year outlook, warning of weaker earnings and sales despite topping second-quarter profit and revenue estimates.

The company reported second-quarter adjusted earnings per share of 25 cents, beating the analyst consensus estimate of 9 cents.

Quarterly sales of $613.266 million (down 5% year over year) outpaced the Street view of $571.312 million.

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Quarterly gross profit decreased to $250.471 million, lower than $275.874 million a year ago.

Operating profit in the quarter under review decreased to $16.30 million from $41.464 million a year ago.

Adjusted EBITDA in the quarter under review decreased to $23.268 million, lower than $43.315 million a year ago.

The company exited the quarter with cash and equivalents worth $301.778 million. Inventories increased 5% to $639.8 million this year compared to $610.5 million last year.

Total debt decreased 96% to $15.5 million this year compared to $414.0 million last year. 

Outlook

For fiscal 2026, the company expects the macro environment, cautious retailer sentiment, and tariff headwinds to weigh on performance.

Incremental tariff costs are projected at $155 million, with mitigation efforts reducing the net impact to about $75 million, largely concentrated in the second half of the year.

G-III Apparel Group ( GIII ) cut its fiscal 2026 adjusted EPS outlook to $2.55–$2.75, down from $4.15–$4.25 and below the $2.90 estimate.

The company also reduced its fiscal 2026 sales forecast to $3.02 billion from $3.14 billion. The revised sales guidance comes in slightly under the $3.131 billion Street consensus.

G-III Apparel Group ( GIII ) projected third-quarter adjusted EPS in the range of $1.43–$1.63, missing the $1.88 analyst estimate. The company expects sales of $1.01 billion, below the $1.10 billion consensus.

Morris Goldfarb, G-III’s Chairman and Chief Executive Officer, said,  “Looking ahead, we have updated fiscal 2026 guidance to reflect the current macro environment, a more cautious outlook from our retail partners, as well as the impact of tariffs on our top and bottom lines.”

“We are actively mitigating tariff pressures through a combination of vendor participation, selective sourcing shifts, and targeted price increases. I am confident in our ability to successfully navigate the challenging environment and responsibly exit the expiring licenses. Our strong balance sheet and dynamic business model provides the flexibility to invest in our brands as well as pursue strategic opportunities to drive long-term growth and shareholder value,” he added.

Price Action: GIII shares are trading lower by 1.77% to $26.50 at last check Thursday.

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