OXFORD INDUSTRIES Cuts Fiscal 2026 Guidance as Lilly Pulitzer Sales Slip
Tommy Bahama's owner posted $394M in Q2 sales and a $42M tariff refund boost, but lowered full-year sales and adjusted EPS guidance.
Oxford Industries (OXM), the owner of Tommy Bahama, Lilly Pulitzer and Johnny Was, reported second-quarter fiscal 2026 net sales of $394 million, down from $403 million a year earlier, and cut its full-year outlook on continued weakness at Lilly Pulitzer and softer consumer spending. GAAP earnings came in at $3.25 per share versus $1.12 last year, boosted by a $2.07 per share tariff-related refund, while adjusted EPS rose to $1.34 from $1.26.
By brand, Tommy Bahama sales edged up 0.8% to $230.9 million, while Lilly Pulitzer fell 5.6% to $85.2 million, Johnny Was dropped 8.8% to $41.4 million and Emerging Brands slipped 3.7% to $37.1 million. Full-price direct-to-consumer sales were down 1% at $289 million, and wholesale sales fell 14% to $52 million, driven mainly by lower off-price volume.
Gross margin jumped to 73.8% from 61.4%, largely because the company recognized $42 million of tariff refund claims as a reduction of cost of goods sold. Excluding tariff refunds and LIFO accounting, adjusted gross margin was 63.1% versus 61.7%. GAAP operating income was $69 million, or 17.4% of sales, with adjusted operating income at $29 million, or 7.4%.
Chairman and CEO Tom Chubb said results were in-line with our expectations, but noted that Tommy Bahama's momentum is being offset by softness in other parts of our portfolio, particularly Lilly Pulitzer, which he attributed to addressable product and marketing challenges in a fashion merchandising business. The company plans to increase promotional activity at Lilly Pulitzer in coming months to spur demand and prevent slow-moving inventory build-up.
On the balance sheet, borrowings fell to $73 million at quarter-end from $143 million at the end of the first quarter and $116 million at the end of fiscal 2025. First-half operating cash flow was $97 million versus $80 million a year earlier, against $32 million of capital expenditure and $22 million in dividends. Inventory was down 12% on a LIFO basis.
For fiscal 2026, Oxford now expects net sales of $1.430 billion to $1.470 billion, below fiscal 2025's $1.478 billion, with GAAP EPS of $3.07 to $3.47 and adjusted EPS of $1.60 to $2.00, down from $2.11 last year. Third-quarter sales are guided to $280 million to $300 million with an adjusted loss per share of $1.40 to $1.20, versus a $0.92 loss a year ago.
The board declared a quarterly dividend of $0.70 per share, payable October 30, 2026 to holders of record on October 16. Oxford has paid a dividend every quarter since going public in 1960. Full-year capital expenditure is now expected at roughly $60 million, down from $108 million in fiscal 2025, reflecting fewer store openings and completion of the Lyons, Georgia distribution center.
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