HanesBrands (HBI) Q2 2025 earnings summary

Executive summary

• Net sales rose 2% year-over-year to $991 million in Q2 2025, with operating profit up 345% to $155 million and EPS at $0.24, compared to a loss of $0.39 last year, driven by growth strategy, transformation, and cost savings.

• Raised full-year 2025 guidance for net sales, operating profit, and EPS due to strong execution, cost savings, and improved business momentum.

• Strategic exits from the global Champion business, U.S.-based outlet stores, and Champion Japan were completed or are in process, with results reported as discontinued operations.

• Continued investment in brands, innovation, and expansion into new categories such as loungewear and scrubs.

• Realigned segments to U.S. and International, eliminating the former Activewear segment.

Financial highlights

• Q2 2025 sales increased 2% year-over-year to $991 million; organic constant currency sales were flat.

• Operating profit rose 345% to $155 million, with operating margin expanding to 15.6% from (6.5)% last year.

• Gross margin increased to 41.6%, up 1,100 basis points year-over-year.

• SG&A expenses decreased 28.8% year-over-year, supporting margin expansion.

• EPS grew 60% year-over-year to $0.24, aided by higher margins and lower interest expense.

Outlook and guidance

• Full-year 2025 guidance raised: net sales expected at ~$3.53 billion, operating profit up to ~$485 million, adjusted EPS projected at $0.66, and free cash flow expected to reach $300 million.

• Q3 2025 guidance: net sales of ~$900 million, operating profit of ~$122 million, adjusted EPS of ~$0.16.

• Conservative outlook maintained due to muted consumer environment and tariff impacts, with mitigation plans in place.

• Capital expenditures for 2025 projected at $65 million, including $50 million in capex and $15 million for cloud computing.

• Management expects sufficient cash and available borrowings to support operations and strategies for at least the next 12 months.