Gildan Activewear (GIL) Q2 2025 earnings summary

Executive summary

• Achieved record Q2 net sales of $919 million, up 6.5% year-over-year, led by 12% Activewear growth and market share gains in key categories.

• Adjusted diluted EPS reached a record $0.97, up 31% year-over-year; GAAP diluted EPS was $0.91, up 160%.

• Operating margin improved to 21.7%, with adjusted operating margin at 22.7%.

• Continued execution of the Sustainable Growth Strategy, including new product launches and ramp-up of the Bangladesh facility.

• Reaffirmed full-year 2025 guidance, narrowing adjusted diluted EPS range and maintaining focus on operational agility.

Financial highlights

• Activewear sales rose 12% year-over-year to $822 million, offsetting a 23% decline in Hosiery and Underwear due to market softness and program resets.

• International sales declined 14% year-over-year, impacted by weaker demand in Europe, Asia, and Latin America.

• Gross margin improved 110 basis points to 31.5%, driven by lower raw material and manufacturing costs, and favorable pricing.

• Adjusted operating income was $209 million, representing 22.7% of net sales, flat year-over-year.

• Free cash flow in Q2 was $154 million; YTD free cash flow was negative $11.5 million due to higher working capital.

Outlook and guidance

• Reaffirmed full-year 2025 guidance: revenue growth mid-single digits, adjusted operating margin up ~50 bps, CapEx at ~5% of sales.

• Adjusted diluted EPS guidance narrowed to $3.40–$3.56, up 13–19% year-over-year.

• Free cash flow projected above $450 million.

• Q3 net sales expected up low single digits year-over-year, with margin and tax rate similar to Q2.

• Guidance reflects current tariffs, ongoing share repurchases, and continued benefits from Barbados jobs credit.