Oxford Industries Faces Sales Slowdown Amid Consumer Caution and Tariff Challenges
Oxford Industries, the parent company of Tommy Bahama, signals reduced consumer spending and tariff impacts, leading to lowered profit forecasts for fiscal 2025.
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Key Insights
- Oxford Industries reports a pullback in consumer spending and anticipates tariffs will negatively affect financial results.
- Full-year profit guidance falls short of analyst expectations.
- CEO Tom Chubb highlights a decline in consumer confidence as a key factor dampening demand.
Oxford Industries (OXM), owner of Tommy Bahama and other apparel brands, has issued a cautionary outlook on slowing sales, resulting in a notable drop in its stock value.
The company forecasts adjusted earnings per share (EPS) between $4.60 and $5.00 for fiscal 2025, significantly below the $6.92 consensus predicted by Visible Alpha.
CEO Tom Chubb noted that despite a strong finish in 2024, consumer shopping trends softened in January due to diminished reasons to shop and worsening consumer sentiment, trends that intensified in February and are expected to continue into the first half of fiscal 2025.
Additionally, CFO Scott Grassmyer indicated that full-year gross margins are expected to decline by 50 to 100 basis points, primarily driven by tariff impacts and a lower share of full-priced direct-to-consumer sales, as shared during the recent earnings call.
Strong Q4 Performance Despite Challenges
Oxford Industries reported adjusted EPS of $1.37 for Q4, surpassing the $1.27 estimate, on revenues of $390.5 million, a 3% decrease year-over-year but above the $383.9 million consensus.
Brand sales saw declines: Tommy Bahama fell 3% to $237.6 million, Lilly Pulitzer dropped 6% to $74.0 million, and Johnny Was decreased 9% to $47.4 million.
Despite these declines, CEO Chubb described the holiday season as "successful" for the company.
Following the earnings report, Oxford Industries shares fell 4% and have lost nearly 50% of their value over the past year.
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