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Executive Summary

Bath & Body Works reported Q1 2026 adjusted EPS of $0.32, beating consensus of $0.29 by 10.3%, while revenue of $1.378B slightly exceeded the $1.36B estimate. However, net sales declined 3% YoY and full-year guidance was maintained at a lower level, with Q2 guidance below prior year. Additionally, CFO Eva Boratto will step down on June 12, adding uncertainty. The stock may see modest reaction given the beat offset by weak trends and leadership change.

Key Financial Metrics

Key Facts

• Q1 net sales $1.378B, down 3% YoY from $1.424B
• Adjusted EPS $0.32 vs consensus $0.29 (beat by 10.3%)
• GAAP EPS $0.90 includes $88M pre-tax interchange fee settlement gain
• Full-year FY2026 guidance maintained: net sales down 4.5%-2.5%, adj EPS $2.40-$2.65
• Q2 FY2026 guidance: net sales down 5%-3% YoY, EPS $0.20-$0.25 (vs $0.30 prior year)
• CFO Eva Boratto to step down June 12; Tom Javitch named interim CFO
• Free cash flow guidance ~$600M for FY2026
• Operating cash flow Q1 $244M; capital expenditures $49M

Financial Impact

Adjusted EPS beat consensus by ~$0.03 (10%), but revenue beat modestly by ~$18M (1.3%). Full-year guidance maintained at levels below prior year, indicating limited near-term improvement.

Risk Factors

• Ongoing sales decline and negative comparable store sales
• CFO transition may disrupt financial planning and investor confidence
• Maintained guidance implies no near-term catalyst for growth acceleration
• Tariff and macroeconomic headwinds could pressure margins further

Market Snapshot

Investment Themes

Documents Analyzed

This report is based on 1 press release from GlobeNewswire.

US Market Status