Oxford Industries, Inc. (OXM) Q3 2025 Earnings Call Transcript

Consolidated Net Sales $307 million in Q3 FY2025 compared to $308 million in Q3 FY2024, a slight decrease. The decrease was within the guidance range of $295 million to $310 million. The decline was attributed to decreased sales in the wholesale channel, particularly in off-price business, despite growth in direct-to-consumer channels.

Direct-to-Consumer Sales Increased by 2% in Q3 FY2025, driven by a 5% increase in e-commerce sales and a 3% increase in food and beverage sales. Full-price brick-and-mortar sales increased by 1%, primarily due to new non-comp locations. However, comps in restaurant and full-price brick-and-mortar locations were down slightly by 2% and 1%, respectively.

Wholesale Channel Sales Decreased by 11% in Q3 FY2025, primarily due to declines in off-price business.

Lilly Pulitzer Sales Achieved double-digit growth in retail and high single-digit growth in e-commerce in Q3 FY2025. However, there was a decline in the wholesale channel.

Tommy Bahama Sales Experienced a low single-digit negative comp in Q3 FY2025. The decline was attributed to challenges in product assortment, particularly in cold-weather categories like sweaters, and increased promotional activity in the market.

Johnny Was Sales Experienced a high single-digit negative comp in Q3 FY2025. The decline was attributed to limitations in seasonal categories due to tariff-driven sourcing adjustments and heightened promotional intensity in the market.

Emerging Brands Sales Posted strong year-over-year sales gains in Q3 FY2025, driven by growing recognition, relevance, customer engagement, and growth potential.

Adjusted Gross Margin Contracted by 200 basis points to 61% in Q3 FY2025. The contraction was driven by $8 million (260 basis points) of increased cost of goods sold due to additional tariffs, a higher proportion of promotional and clearance sales, and changes in sales mix. These were partially offset by lower freight costs and improved carrier rates.

Adjusted SG&A Expenses Increased by 4% to $209 million in Q3 FY2025 compared to $201 million in Q3 FY2024. The increase was primarily due to higher employment costs, occupancy costs, and depreciation expenses from opening 16 net new brick-and-mortar locations since Q3 FY2024.

Adjusted Operating Loss $18 million in Q3 FY2025, representing a negative 5.8% operating margin, compared to a 3% operating loss (negative 1.1% margin) in Q3 FY2024. The decline was due to increased SG&A expenses and gross margin contraction.

Adjusted Net Loss Per Share $0.92 in Q3 FY2025, compared to a loss in the prior year. The loss was driven by lower operating income, higher interest expenses, and a higher effective tax rate.

Inventory Increased by 1% on a LIFO basis and 3% on a FIFO basis in Q3 FY2025 compared to Q3 FY2024. The increase was primarily due to $4 million of additional costs capitalized into inventory related to U.S. tariffs.

Long-Term Debt $140 million at the end of Q3 FY2025, compared to $81 million at the end of Q2 FY2025 and $31 million at the end of FY2024. The increase was attributed to seasonal cash flow fluctuations, lower earnings, and higher capital expenditures.

Cash Flow from Operations $70 million in the first 9 months of FY2025, compared to $104 million in the same period of FY2024. The decline was due to lower net earnings and changes in working capital needs.