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Get filing alertsBath & Body Works beats Q2 guidance on $80M tariff refund, raises full-year EPS outlook
Filed August 26, 2026 · Period ending August 26, 2026 · ~1 min read
Key Changes
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Q2 2026 adjusted EPS of $0.62 included $80M in tariff refunds; excluding the one-time benefit, adjusted EPS would have been $0.31, below the prior-year $0.30.
Exhibit 99.1 view on EDGAR → -
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Raised full-year 2026 adjusted EPS guidance to $2.60–$2.80 (vs. $3.21 in fiscal 2025); narrowed sales guidance to a decline of 4%–2.5% vs. fiscal 2025's $7,291M.
Exhibit 99.1 view on EDGAR → -
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Exhibit 99.1 view on EDGAR →
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Direct (online) sales grew 3.0% in Q2 2026 to $275M, the first direct sales growth since 2021, while store sales fell 5.4% to $1,131M.
Exhibit 99.1 view on EDGAR → -
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Q2 2026 net sales of $1,514M declined 2.3% year-over-year; operating income rose to $216M from $157M, aided by the tariff refund and transformation cost controls.
Exhibit 99.1 view on EDGAR →
Summary
Bath & Body Works reported second-quarter 2026 results that exceeded guidance, but the headline beat was driven almost entirely by an $80 million tariff refund. A bright spot: direct (online) sales grew 3% in the quarter, the first growth since 2021, though store sales fell 5.4%.
Management expects to generate approximately $650 million in free cash flow for the year with no share repurchases assumed. Investors should watch whether the online momentum can offset persistent store weakness and whether profitability stabilizes after the third-quarter trough.
Section-by-Section Diff
Event · Exhibit 99.1
Added in current filing · view on EDGAR →
The company reported net sales of $1,514 million for the quarter ended August 1, 2026, a decrease of 2.3% compared to net sales of $1,549 million for the quarter ended August 2, 2025. Earnings per diluted share were $0.58 for the second quarter of 2026 compared to $0.30 last year. Second quarter operating income was $216 million compared to $157 million last year, and net income was $118 million compared to $64 million last year. Reported second quarter 2026 results included aggregate pre-tax costs of $9 million ($7 million after tax) associated with business transformation activities. Excluding this item, adjusted earnings per diluted share was $0.62, adjusted operating income was $225 million and adjusted net income was $125 million.
Bath & Body Works reported Q2 2026 net sales of $1,514 million, down 2.3% year-over-year. Reported EPS was $0.58, up from $0.30 last year; adjusted EPS was $0.62 (excluding $9 million in transformation costs). Operating income rose to $216 million from $157 million. The company noted sequential improvement in Body Care, stronger pricing on new products, and first direct sales growth since 2021.
Added in current filing · view on EDGAR →
The company is narrowing its full-year 2026 guidance of net sales to decline between 4% to 2.5% compared to $7,291 million in fiscal 2025. The company is also raising its full-year 2026 earnings per diluted share guidance to between $3.13 and $3.33 compared to $3.11 in fiscal 2025 and full-year 2026 adjusted earnings per diluted share guidance to between $2.60 and $2.80, compared to adjusted earnings per diluted share of $3.21 in 2025. There are no share repurchases assumed in our outlook. In fiscal 2026, we now expect to generate free cash flow of approximately $650 million.
Bath & Body Works raised its full-year 2026 EPS guidance to $3.13-$3.33 (from $3.11 prior year) and adjusted EPS guidance to $2.60-$2.80. The company narrowed its sales guidance to a decline of 4% to 2.5% versus fiscal 2025's $7,291 million. Free cash flow is expected to be approximately $650 million, with no share repurchases assumed.
Added in current filing · view on EDGAR →
For the third quarter of 2026, the company is forecasting net sales to decline between 5% to 2.5% compared to $1,594 million in the third quarter of 2025. Third quarter 2026 earnings per diluted share is expected to be between $0.05 and $0.10, compared to earnings per diluted share of $0.37 in the third quarter of 2025 and third quarter 2026 adjusted earnings per diluted share is expected to be between $0.07 and $0.12 compared to adjusted earnings per diluted share of $0.35 in the third quarter of 2025.
For Q3 2026, the company forecasts net sales to decline 5% to 2.5% versus Q3 2025's $1,594 million. Q3 2026 EPS is expected at $0.05-$0.10 (down from $0.37 last year) and adjusted EPS at $0.07-$0.12 (down from $0.35 last year), indicating continued near-term pressure on profitability.
Added in current filing · view on EDGAR → · paraphrased
Direct - U.S. and Canada 275 267 3.0 % 521 517 0.8 % Stores - U.S. and Canada (a) $ 1,131 $ 1,196 (5.4 %) $ 2,194 $ 2,307 (4.9 %) Total Company-operated Stores: | Stores Stores | 1/31/2026 Opened Closed 8/1/2026 | United States 1,814 36 (27) 1,823 | Canada 113 1 — 114 Total Bath & Body Works 1,927 37 (27) 1,937
Direct (online) sales in the U.S. and Canada grew 3.0% in Q2 2026 to $275 million, marking the first direct sales growth since 2021. Store sales declined 5.4% to $1,131 million. The company operated 1,937 stores as of August 1, 2026, a net increase of 10 stores from January 31, 2026, with 37 openings and 27 closures.
Event · Item 2.02 — Results of Operations and Financial Condition
Item 2.02 — Results of Operations and Financial Condition filed; see Key Changes for terms.
Added in current filing · view on EDGAR → · paraphrased
The company delivered second quarter comparable sales growth of 2% in the U.S. and Canada.
The company achieved 2% comparable sales growth in the U.S. and Canada during Q2 2024, indicating positive same-store performance in its core markets.
Added in current filing · view on EDGAR → · paraphrased
During the second quarter, the company repurchased 4.8 million shares for $175 million.
Bath & Body Works repurchased 4.8 million shares for $175 million during Q2 2024, representing capital returned to shareholders through buybacks.
Event · Item 7.01 — Regulation FD Disclosure
Bath & Body Works disclosed Q2 2026 financial results and updated earnings guidance for Q3 and full-year 2026.
Added in current filing · verify on EDGAR →
On August 26, 2026, Bath & Body Works, Inc. issued a press release setting forth its unaudited financial results for the second quarter of 2026 and its earnings guidance for the third quarter of 2026. In addition, the press release contains updated earnings guidance for the full-year 2026.
The company released its second quarter 2026 financial results and provided earnings guidance for the third quarter and updated full-year 2026 guidance. The 8-K body does not contain the actual financial figures; those are in the attached press release (Exhibit 99.1), which was not provided in the input text.
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Figures/quotes linked to EDGAR · Narrative written by AI · Aug 27, 2026 · How we verify