Q1 revenue +4% but operating margin falls 730bp on tariffs, Americas weakness, proxy costs

Filed June 4, 2026 · Period ending May 3, 2026 · Compared to 10-Q Jun 5, 2025 · ~2 min read

Key Changes

• high

  Operating margin fell 730 basis points to 11.2% as gross margin compressed 410bp (tariff hit 330bp) and SG&A rose 310bp as % of revenue. Diluted EPS dropped 35% to $1.69.

  MD&A: Operating Margin & Gross Margin verify on EDGAR →
• high

  Americas comparable sales declined 5% (6% constant dollar) on lower conversion and traffic. Management launched action plan focused on full-price selling to reverse trend.

  MD&A: Americas Segment verify on EDGAR →
• high

  Supreme Court invalidated IEEPA tariffs Feb 2026; company paid $230M under IEEPA, filed refund claims (recovery uncertain, no asset recognized), but new tariffs imposed under different authority.

  MD&A: Tariff Landscape verify on EDGAR →