Q3 2026 G-III Apparel Group Ltd Earnings Call Transcript
Key Points
- G-III Apparel Group Ltd (GIII) delivered strong profitability in the third quarter, with earnings exceeding the high end of their guidance range.
- The company successfully replaced over 70% of the lost sales volume from the PVH licensing partnership through organic growth of their owned and licensed portfolio.
- G-III Apparel Group Ltd (GIII) ended the quarter with a strengthened balance sheet, holding a net cash position of $174 million.
- The company experienced a significant increase in digital traffic, with a 20% lift across their owned dot-com, driving substantial growth in conversion rates and overall sales.
- Donna Karan outperformed expectations, delivering impressive double-digit sales increases in North America and is expected to grow by 40% in fiscal 2026.
- Net sales for the third quarter were $989 million, a decline from $1.09 billion in the same period last year, primarily due to lower sales from Calvin Klein and Tommy Hilfiger license businesses.
- Gross margin declined to 38.6% from 39.8% in the previous year's third quarter, impacted by tariffs.
- The company is absorbing a larger share of tariff-related costs in the current fiscal year, which has pressured margins.
- The PVH sales decline accelerated quicker than anticipated, with the remaining PVH brand sales expected to be approximately $400 million in fiscal 2027.
- Non-GAAP net income for the third quarter was $83 million, or $1.90 per share, compared to $116 million, or $2.59 per share, in the previous year.
Ladies and gentlemen, thank you for standing by. Welcome to G-III Apparel Group third-quarter fiscal 2026 earnings call. (Operator Instructions) Please be advised that today's conference is being recorded.
I would like now to turn the conference over to Neal Nackman, Chief Financial Officer. Neal, please go ahead.
Good morning, and thank you for joining us.
Before we begin, I would like to remind participants that certain statements made on today's call and in the Q&A session may constitute forward-looking statements within the meaning of the federal security laws. Forward-looking statements are not guaranteed, and actual results may differ materially from those expressed or implied in forward-looking statements. Important factors that could cause actual results of operations or the financial condition of the company to differ are discussed in the documents filed by the company with the SEC. The company undertakes no duty to update any forward-looking statements.
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