Bath & Body Works Posts Strong Results, Outlook on High Demand, Customer Loyalty
Key Takeaways
- Bath & Body Works exceeds quarterly estimates on positive growth in store traffic and its loyalty program.
- The retailer also raised its full-year guidance on optimism about the key holiday season ahead.
- The company benefited from having a predominately U.S.-based supply chain.
Bath & Body Works (BBWI) shares skyrocketed when the personal care items retailer posted better-than-expected results and boosted its outlook on strong store traffic, customer loyalty and optimism about the upcoming holiday season.
The owner of its namesake locations reported third-quarter adjusted earnings per share (EPS) of $0.49, with revenue up 3.1% to $1.61 billion. Both exceeded forecasts.
The company noted that sales of home fragrance, body care, and soap and sanitizer products all rose in the low-single-digit percent. It set a record for customer retention rates, and active members of its loyalty program rose 4% from the previous quarter to approximately 38 million. More than 80% of its U.S. sales came from program members.
CEO Gina Boswell said Bath & Body Works was “capitalizing on our agile business model and predominantly U.S.-based supply chain, and we believe we are well-positioned to navigate a volatile retail environment and shorter holiday calendar.”
The company now sees full-year adjusted EPS of $3.15 to $3.28, compared to its earlier guidance of $3.06 to $3.26. It predicts revenue to decline 1.7% to 2.5%, versus the previous expectation of a drop of 2.0% to 4.0%.
Despite today’s gains, shares of Bath & Body Works remain lower year-to-date.
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