Duluth Holdings Inc. (NASDAQ: DLTH) announced a three-phase turnaround strategy called "Build to Last" during its investor event in New York on June 8. The company targets doubling EBITDA by 2028 through the strategic framework.

The Mount Horeb, Wisconsin-based retailer completed the first phase, "Seal the Foundation," throughout fiscal 2025. The company stabilized operations by reducing inventory and restoring pricing discipline. All stores in the fleet returned to profitability, gross margins expanded 420 basis points to 53.4%, and the company generated $16.6 million in free cash flow.

First-quarter 2026 results showed continued momentum. Net sales declined to $98.6 million due to reduced promotional discounting, while retail comparable store sales grew 1.4%. Gross margins increased 540 basis points to 57.4%, inventory decreased 24.8%, and free cash flow improved $42.6 million year-over-year.

The second phase, "Frame the Structure," spans 2026 and 2027 and focuses on reenergizing the core customer base while shifting marketing away from heavy promotional activity toward brand awareness building.

The final phase, "Raise the Roof," beginning in 2028, targets accelerated profitable growth. Plans include expanding the customer base, achieving consistent positive comparable sales across retail and direct-to-consumer channels, and unlocking revenue growth through loyalty programs, women's expansion, select new stores, and additional distribution.

Duluth Trading operates approximately 66 retail locations nationwide and sells workwear, casual wear, and accessories for men and women through e-commerce and retail channels.