Gildan Activewear (GIL) Q3 2025 earnings summary

Executive summary

• Achieved record Q3 net sales of $911 million, up 2.2% year-over-year, with Activewear sales rising 5.4% and adjusted diluted EPS reaching $1.00, up 17.6% year-over-year.

• Comfort Colors brand delivered double-digit growth and expanded capacity, with new product launches supporting portfolio diversification.

• Announced a definitive merger agreement to acquire HanesBrands, expected to close late 2025 or early 2026, with a total equity value of $2.2 billion and enterprise value of $4.4 billion.

• Year-to-date net sales grew 3.7% to $2.54 billion, with Activewear up 8.7% and Hosiery/underwear down 27.5% due to market weakness and the exit of the Under Armour business.

• Integration planning for the HanesBrands acquisition is underway, targeting at least $200 million in run-rate synergies and a broader retail presence.

Financial highlights

• Q3 gross profit was $307 million (33.7% margin), up from $278 million (31.2%) last year, driven by lower manufacturing costs and favorable pricing.

• Adjusted operating income was $212 million (23.2% margin), up 80 basis points year-over-year.

• Q3 net earnings were $120 million; adjusted net earnings were $149 million.

• Free cash flow for the first nine months was $189 million, with $200 million generated in Q3.

• Net debt at quarter-end was $1.74 billion, with a leverage ratio of 2.0x net debt to trailing twelve months adjusted EBITDA.

Outlook and guidance

• 2025 revenue growth expected at mid-single digits; adjusted operating margin to rise by ~70 basis points; capex to be ~4% of sales.

• Adjusted diluted EPS guidance narrowed to $3.45–$3.51, up 15–17% year-over-year; free cash flow expected at ~$400 million.

• No further share repurchases planned for 2025 due to the HanesBrands acquisition; adjusted effective tax rate to remain stable.

• Company expects to largely mitigate the impact of new U.S. tariffs through supply chain flexibility and pricing actions, but acknowledges ongoing uncertainty.

• Assumes no significant deterioration in market, pricing, or labor conditions.