Bath & Body Works reports quarterly earnings above guidance

Bath & Body Works, Inc. (NYSE: BBWI) reported fourth quarter net sales of $2.7 billion, down 2% from the prior year period. The company posted earnings per diluted share of $1.99, compared to $2.09 in the fourth quarter of 2024.

For the full year 2025, net sales totaled $7.3 billion, a decrease of 0.2% compared to 2024. Full-year earnings per diluted share were $3.11, down from $3.61 in the previous year. The company repurchased 15.1 million shares for $400 million during fiscal 2025.

Bath & Body Works provided guidance for fiscal 2026, forecasting net sales to decline between 2.5% to 4.5% compared to fiscal 2025. The company expects full-year 2026 earnings per diluted share of $3.00 to $3.25. Adjusted earnings per diluted share are projected to be between $2.40 and $2.65 for 2026.

The guidance includes several one-time items expected in 2026, including an $88 million pre-tax gain from a payment card interchange fee litigation settlement, a $62 million tax benefit from the resolution of tax matters, and a $9 million pre-tax loss related to bond redemption.

For the first quarter of 2026, the company expects net sales to decline 4% to 6% compared to the first quarter of 2025. First quarter earnings per diluted share are forecasted at $0.84 to $0.90.

Chief Executive Officer Daniel Heaf stated the company has launched its Consumer First Formula initiative, focusing on innovation acceleration, brand modernization, and distribution expansion. Recent developments include an earlier-than-planned Amazon launch and the rollout of a new brand identity.

Bath & Body Works operates more than 1,900 stores in the U.S. and Canada, plus over 500 international locations. The company expects to generate approximately $600 million in free cash flow for fiscal 2026.

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