Bath & Body Works (BBWI) Q3 2025 earnings summary

Executive summary

• Q3 net sales reached $1.61 billion, up 3% year-over-year, exceeding guidance and driven by new store growth, innovation, and positive store traffic.

• Adjusted EPS for Q3 was $0.49, above guidance and up from $0.48 last year, with operating income at $218 million, down 1% year-over-year.

• Record customer retention and loyalty engagement, with 38 million active loyalty members, up 4% year-over-year.

• Cost optimization initiatives delivered $35 million in Q3 and are expected to reach $150 million in 2024, with $300 million targeted over two years.

• Strategic investments in product innovation, marketing, and omnichannel capabilities are driving momentum.

Financial highlights

• Q3 2024 net income was $106 million, down from $119 million last year; gross profit was $700 million with a 43.5% margin, nearly flat year-over-year.

• SG&A expense rate was 30% of net sales, up 50 bps year-over-year, aided by cost discipline and timing shifts.

• U.S. and Canadian store net sales rose 4.4% to $1.2 billion; direct net sales increased 1.5% to $321 million.

• International net sales declined 11.1% due to war-affected regions, offset by double-digit growth elsewhere.

• Interest expense for Q3 2024 was $77 million, down from $84 million last year.

Outlook and guidance

• Q4 net sales expected to decline 6.5% to 4.5% year-over-year due to calendar shifts and fewer shopping days.

• Q4 gross profit rate guided at 46.3%, up 40 bps, with SG&A at 22.4%.

• Q4 EPS forecasted between $1.94 and $2.07.

• Full-year net sales expected to decline 2.5% to 1.7%, with adjusted EPS raised to $3.15–$3.28.

• Guidance includes $400 million in share repurchases for the year.