Bath & Body Works Beats Q2, Raises FY26 EPS Guidance, but Q3 Outlook Signals Sharp Decline
BBWI sits 26% above its 52-week low of $14.275 on elevated volume (2.1× avg).
Summary
Bath & Body Works beat Q2 expectations with adjusted EPS of $0.62 and raised full-year guidance, but Q3 guidance of $0.05-$0.10 signals a sharp sequential decline. Q2 results were boosted by $80 million in tariff refunds.
Key Events · Earnings and Guidance · BBWI
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Q2 Results Beat Guidance
Net sales of $1,514 million (down 2.3% YoY) and adjusted EPS of $0.62 exceeded guidance. Reported EPS was $0.58 versus $0.30 last year.
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Tariff Refunds Inflate Q2
Q2 results included approximately $80 million of tariff refunds. Excluding this benefit, adjusted EPS would have been $0.31, revealing underlying operational pressure.
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Q3 Guidance Signals Sharp Decline
Q3 2026 EPS guidance of $0.05-$0.10 compares to $0.37 in Q3 2025 and $0.58 reported in Q2 2026. Net sales are expected to decline 5% to 2.5%.
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Full-Year Guidance Raised
Full-year 2026 adjusted EPS guidance raised to $2.60-$2.80 (from prior), but this includes one-time gains: $88 million interchange fee settlement and $62 million tax benefit.
Analysis · BBWI · Trade & Services
Bath & Body Works delivered Q2 adjusted EPS of $0.62, beating guidance, and raised full-year adjusted EPS guidance to $2.60-$2.80. However, the Q3 guidance of $0.05-$0.10 EPS represents a sharp sequential decline from Q2 and a steep drop from $0.37 in Q3 2025. The company also disclosed that Q2 results included approximately $80 million in tariff refunds — excluding that benefit, adjusted EPS would have been only $0.31, revealing underlying operational pressure. The raised full-year guidance is largely driven by one-time items, including an $88 million interchange fee settlement gain and a $62 million tax benefit, rather than core business improvement.
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At the time of this filing, BBWI was trading at $17.97 on NYSE in the Trade & Services sector, with a market capitalization of approximately $3.5B. The 52-week trading range was $14.28 to $32.32. This filing was assessed with neutral market sentiment and an importance score of 7 out of 10.