Lands' End (LE) Q1 2026 earnings summary

Executive summary

• Net revenue for Q1 was $261.2M, down 8.5% year-over-year; excluding inventory transition, revenue declined 4.2%.

• Gross margin improved by 210 bps to 50.8%, a record for the quarter, driven by licensing transitions and inventory actions.

• Adjusted net loss was $5.4M ($0.18/share), improved from $6.2M ($0.20/share) prior year; adjusted EBITDA was $9.5M, down from $11.6M.

• $3.3M in restructuring charges incurred, including a 6% reduction in corporate office positions and costs related to strategic alternatives.

• Strategic alternatives process, including a potential sale or merger, remains ongoing.

Financial highlights

• U.S. Digital segment revenue was $227.7M, down 0.4% year-over-year; U.S. eCommerce revenue was flat at $170.7M.

• Europe eCommerce revenue fell 28.4% to $17.9M, reflecting brand repositioning and inventory cleanup.

• Licensing revenue increased over 60% year-over-year, with new categories added.

• Gross profit was $132.7M, down 4.5% year-over-year; selling and administrative expenses decreased by $3.9M.

• Cash and equivalents were $18.1M at quarter end; inventories down 9% to $262M.

Outlook and guidance

• Fiscal 2025 guidance: net revenue $1.33B–$1.45B, GMV mid- to high-single digit growth, adjusted net income $15M–$27M, adjusted EPS $0.48–$0.86, adjusted EBITDA $95M–$107M.

• Guidance incorporates 30% China tariffs and 10% for rest of world, with mitigation measures in place.

• $25M in capital expenditures expected for the year.

• Management expects cash on hand, operations, and ABL Facility to be adequate for at least the next 12 months.