Lands' End Announces Second Quarter Fiscal 2026 Results
| LANDS' END, INC. Condensed Consolidated Balance Sheets (Unaudited) | ||||||||||||
| (in thousands, except per share data) | July 31, 2026 | August 1, 2025 | January 30, 2026* | |||||||||
| ASSETS | ||||||||||||
| Current assets | ||||||||||||
| Cash and cash equivalents | $ | 16,113 | $ | 21,255 | $ | 17,694 | ||||||
| Restricted cash | 590 | 2,291 | 589 | |||||||||
| Accounts receivable, net | 38,329 | 39,028 | 41,265 | |||||||||
| Inventories | 342,040 | 301,797 | 268,803 | |||||||||
| Prepaid expenses | 30,243 | 30,400 | 27,856 | |||||||||
| Other current assets | 452 | 10,291 | 4,798 | |||||||||
| Total current assets | 427,767 | 405,062 | 361,005 | |||||||||
| Property and equipment, net | 128,576 | 117,205 | 115,701 | |||||||||
| Operating lease right-of-use asset | 13,995 | 18,856 | 15,680 | |||||||||
| Equity method investment | 377,589 | - | - | |||||||||
| Intangible asset | - | 257,000 | - | |||||||||
| Asset held for sale | - | - | 257,000 | |||||||||
| Other assets | 1,639 | 2,518 | 1,680 | |||||||||
| TOTAL ASSETS | $ | 949,566 | $ | 800,641 | $ | 751,066 | ||||||
| LIABILITIES AND STOCKHOLDERS' EQUITY | ||||||||||||
| Current liabilities | ||||||||||||
| Current portion of long-term debt | $ | - | $ | 13,000 | $ | 13,000 | ||||||
| Accounts payable | 162,346 | 147,846 | 115,436 | |||||||||
| Lease liability – current | 4,540 | 4,609 | 4,434 | |||||||||
| Accrued expenses and other current liabilities | 103,985 | 85,084 | 91,068 | |||||||||
| Total current liabilities | 270,871 | 250,539 | 223,938 | |||||||||
| Long-term borrowings under ABL Facility | 60,000 | 35,000 | - | |||||||||
| Long-term debt, net | - | 219,550 | 214,211 | |||||||||
| Lease liability – long-term | 12,128 | 17,986 | 14,264 | |||||||||
| Deferred tax liabilities | 109,339 | 50,319 | 52,392 | |||||||||
| Other liabilities | 4,358 | 2,123 | 1,966 | |||||||||
| TOTAL LIABILITIES | 456,696 | 575,517 | 506,771 | |||||||||
| STOCKHOLDERS' EQUITY | ||||||||||||
| Common stock, par value $0.01 authorized: 480,000 shares; issued and outstanding: 30,023, 30,517 and 30,575, respectively | 301 | 306 | 306 | |||||||||
| Additional paid-in capital | 338,876 | 346,841 | 349,429 | |||||||||
| Retained earnings (accumulated deficit) | 170,095 | (106,287 | ) | (88,850 | ) | |||||||
| Accumulated other comprehensive loss | (16,402 | ) | (15,736 | ) | (16,590 | ) | ||||||
| TOTAL STOCKHOLDERS' EQUITY | 492,870 | 225,124 | 244,295 | |||||||||
| TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $ | 949,566 | $ | 800,641 | $ | 751,066 | ||||||
* Derived from the audited consolidated financial statements included in the Company's Annual Report on Form 10-K for the fiscal year ended January 30, 2026.
| LANDS' END, INC. Condensed Consolidated Statements of Operations (Unaudited) | ||||||||||||||||
| 13 Weeks Ended | 26 Weeks Ended | |||||||||||||||
| (in thousands, except per share data) | July 31, 2026 | August 1, 2025 | July 31, 2026 | August 1, 2025 | ||||||||||||
| Net revenue | $ | 302,038 | $ | 294,079 | $ | 540,954 | $ | 555,287 | ||||||||
| Cost of sales (exclusive of depreciation and amortization) | 145,023 | 150,661 | 272,427 | 279,143 | ||||||||||||
| Gross profit | 157,015 | 143,418 | 268,527 | 276,144 | ||||||||||||
| Selling and administrative | 135,250 | 129,356 | 261,702 | 252,818 | ||||||||||||
| Depreciation and amortization | 6,147 | 7,656 | 12,247 | 15,947 | ||||||||||||
| Equity method investment income | (4,243 | ) | - | (4,439 | ) | - | ||||||||||
| Other operating expense, net | 11,674 | 2,423 | 34,938 | 5,766 | ||||||||||||
| Operating income (loss) | 8,187 | 3,983 | (35,921 | ) | 1,613 | |||||||||||
| Interest expense | 1,021 | 9,262 | 6,535 | 18,527 | ||||||||||||
| Gain on WHP Transaction | - | - | (491,622 | ) | - | |||||||||||
| Loss on extinguishment of debt | - | - | 9,172 | - | ||||||||||||
| Other income, net | (1,051 | ) | (3 | ) | (915 | ) | (14 | ) | ||||||||
| Income (loss) before income taxes | 8,217 | (5,276 | ) | 440,909 | (16,900 | ) | ||||||||||
| Income tax expense (benefit) | 4,766 | (1,609 | ) | 106,765 | (4,971 | ) | ||||||||||
| NET INCOME (LOSS) | $ | 3,451 | $ | (3,667 | ) | $ | 334,144 | $ | (11,929 | ) | ||||||
| Earnings (loss) per common share | ||||||||||||||||
| Basic | $ | 0.12 | $ | (0.12 | ) | $ | 11.12 | $ | (0.39 | ) | ||||||
| Diluted | $ | 0.11 | $ | (0.12 | ) | $ | 10.96 | $ | (0.39 | ) | ||||||
| Weighted average common shares outstanding | ||||||||||||||||
| Basic | 29,902 | 30,743 | 30,052 | 30,721 | ||||||||||||
| Diluted | 30,108 | 30,743 | 30,498 | 30,721 | ||||||||||||
Definitions, Reconciliations and Uses of Non-GAAP Financial Measures
In addition to our Net income (loss) determined in accordance with GAAP, for purposes of evaluating operating performance, we report the following non-GAAP measures: Adjusted net income (loss) and Adjusted EBITDA. Adjusted net income (loss) is also expressed on a diluted per share basis.
We believe presenting non-GAAP financial measures provides useful information to investors, allowing them to assess how the business performed excluding the effects of significant non-recurring or non-operational amounts. We believe the use of the non-GAAP financial measures facilitates comparing the results being reported against past and future results by eliminating amounts that we believe are not comparable between periods and assists investors in evaluating the effectiveness of our operations and underlying business trends in a manner that is consistent with management's own methods for evaluating business performance.
Our management uses Adjusted net income (loss) and Adjusted EBITDA to evaluate the operating performance of our business for comparable periods and to discuss our business with our Board of Directors, institutional investors and other market participants. Adjusted EBITDA is also used as the basis for a performance measure used in executive incentive compensation.
The methods we use to calculate our non-GAAP financial measures may differ significantly from methods other companies use to compute similar measures. As a result, any non-GAAP financial measures presented herein may not be comparable to similar measures provided by other companies. Adjusted net income (loss) and Adjusted EBITDA should not be used by investors or other third parties as the sole basis for formulating investment decisions as these measures may exclude a number of important cash and non-cash recurring items.
Adjusted net income (loss) is defined as net income (loss) excluding significant non-recurring or non-operational items as set forth below. Adjusted net income (loss) is also presented on a diluted per share basis. While Adjusted net income (loss) is a non-GAAP measurement, management believes that it is an important indicator of operating performance and useful to investors.
- Other significant non-recurring or non-operational items, while periodically affecting our results, may vary significantly from period to period and have a disproportionate effect in a given period, which affects comparability of results and are described below:
- Corporate restructuring and other – composed of costs related to the strategic alternative process and completion and severance and benefit costs for the 13 and 26 weeks ended July 31, 2026 and August 1, 2025 as well as costs related to the transition of executive leadership for the 13 and 26 weeks ended July 31, 2026. Unmitigated tariff costs – unmitigated incremental product costs, net of the impact of vendor negotiations, incurred pursuant to International Emergency Economic Powers Act (“IEEPA”) tariffs that were subsequently ruled unlawful by the Supreme Court of the United States on February 20, 2026 for the 13 and 26 weeks ended July 31, 2026 and August 1, 2025. JV intangible asset amortization – Lands' End's proportionate share of intangible asset amortization expense recorded within the JV's financial results for the 13 and 26 weeks ended July 31, 2026. Unmitigated tariff recovery – unmitigated incremental product costs, net of the impact of vendor negotiations, incurred pursuant to International Emergency Economic Powers Act (“IEEPA”) tariffs that were subsequently ruled unlawful by the Supreme Court of the United States on February 20, 2026 recovered for the 13 and 26 weeks ended July 31, 2026. Loss on extinguishment of debt – prepayment premium associated with the repayment of the Term Loan Facility before the scheduled maturity date and the write off of related unamortized debt issuance costs of the Term Loan Facility for the 26 weeks ended July 31, 2026. Exit costs – charges associated to exit kids and footwear lines of business including inventory excess and obsolescence reserves, inventory discounts and operational charges recorded in the 26 weeks ended August 1, 2025 in conjunction with our licensing arrangements commencing in Fiscal 2024. Gain on WHP Transaction – Gain recognized in conjunction with the transfer of the Lands' End intellectual property to the JV, and immediately thereafter, sale of a 50% controlling ownership stake in the JV to WHP Global for the 26 weeks ended July 31, 2026.
The following table sets forth, for the periods indicated, a reconciliation of Net income (loss) to Adjusted net income (loss) and Adjusted diluted earnings (loss) per share:
| Unaudited | 13 Weeks Ended | |||||||
| (in thousands, except per share amounts) | July 31, 2026 | August 1, 2025 | ||||||
| Net income (loss) | $ | 3,451 | $ | (3,667 | ) | |||
| Corporate restructuring and other | 11,677 | 2,434 | ||||||
| Unmitigated tariff costs(1) | 5,100 | 1,000 | ||||||
| JV intangible asset amortization | 5,090 | - | ||||||
| Unmitigated tariff recovery | (24,900 | ) | - | |||||
| Tax effects on adjustments(2) | 2,261 | (873 | ) | |||||
| ADJUSTED NET INCOME (LOSS) | $ | 2,679 | $ | (1,106 | ) | |||
| ADJUSTED DILUTED EARNINGS (LOSS) PER SHARE | $ | 0.09 | $ | (0.04 | ) | |||
| Diluted weighted average common shares outstanding | 30,108 | 30,743 | ||||||
(1) Beginning in Fourth Quarter 2025, the Company adjusts for unmitigated tariff costs. Prior-period amounts have been recast on a comparable basis to reflect this adjustment.
(2) The tax impact of adjustments is calculated at the applicable U.S. and non-U.S. Federal and State statutory rates.
| Unaudited | 26 Weeks Ended | |||||||
| (in thousands, except per share amounts) | July 31, 2026 | August 1, 2025 | ||||||
| Net income (loss) | $ | 334,144 | $ | (11,929 | ) | |||
| Corporate restructuring and other | 34,967 | 5,766 | ||||||
| Unmitigated tariff costs(1) | 11,900 | 1,000 | ||||||
| Loss on extinguishment of debt | 9,172 | - | ||||||
| JV intangible asset amortization | 6,787 | - | ||||||
| Unmitigated tariff recovery | (24,900 | ) | - | |||||
| Gain on WHP Transaction | (491,622 | ) | - | |||||
| Exit costs | - | 257 | ||||||
| Tax effects on adjustments(2) | 118,721 | (1,619 | ) | |||||
| ADJUSTED NET LOSS | $ | (831 | ) | $ | (6,525 | ) | ||
| ADJUSTED DILUTED LOSS PER SHARE | $ | (0.03 | ) | $ | (0.21 | ) | ||
| Diluted weighted average common shares outstanding | 30,498 | 30,721 | ||||||
(1) Beginning in Fourth Quarter 2025, the Company adjusts for unmitigated tariff costs. Prior-period amounts have been recast on a comparable basis to reflect this adjustment.
(2) The tax impact of adjustments is calculated at the applicable U.S. and non-U.S. Federal and State statutory rates.
While Adjusted EBITDA is a non-GAAP measurement, management believes that it is an important indicator of operating performance, and is useful to investors, because EBITDA excludes the effects of financings, investing activities and tax structure by eliminating the effects of interest, depreciation and income tax.
- Other significant items, while periodically affecting our results, may vary significantly from period to period and have a disproportionate effect in a given period, which affects comparability of results and are described below:
- Corporate restructuring and other – composed of costs related to the strategic alternative process and completion and severance and benefit costs for the 13 and 26 weeks ended July 31, 2026 and August 1, 2025 as well as costs related to the transition of executive leadership for the 13 and 26 weeks ended July 31, 2026. Unmitigated tariff costs – unmitigated incremental product costs, net of the impact of vendor negotiations, incurred pursuant to International Emergency Economic Powers Act (“IEEPA”) tariffs that were subsequently ruled unlawful by the Supreme Court of the United States on February 20, 2026 for the 13 and 26 weeks ended July 31, 2026 and August 1, 2025. JV intangible asset amortization – Lands' End's proportionate share of intangible asset amortization expense recorded within the JV's financial results for the 13 and 26 weeks ended July 31, 2026. Unmitigated tariff recovery – unmitigated incremental product costs, net of the impact of vendor negotiations, incurred pursuant to International Emergency Economic Powers Act (“IEEPA”) tariffs that were subsequently ruled unlawful by the Supreme Court of the United States on February 20, 2026 recovered for the 13 and 26 weeks ended July 31, 2026. Net gain on disposal of property and equipment – disposal of property and equipment for the 13 and 26 weeks ended July 31, 2026 and August 1, 2025. Exit costs - charges associated to exit kids and footwear lines of business including inventory excess and obsolescence reserves, inventory discounts and operational charges recorded in the 26 weeks ended August 1, 2025 in conjunction with our licensing arrangements commencing in Fiscal 2024.
The following table sets forth, for the periods indicated, selected income statement data, both in dollars and as a percentage of Net revenue and a reconciliation of Net income (loss) to Adjusted EBITDA:
| Unaudited | 13 Weeks Ended | |||||||||||||||
| (in thousands) | July 31, 2026 | August 1, 2025 | ||||||||||||||
| Net income (loss) | $ | 3,451 | 1.1 | % | $ | (3,667 | ) | (1.2 | )% | |||||||
| Income tax expense (benefit) | 4,766 | 1.6 | % | (1,609 | ) | (0.5 | )% | |||||||||
| Interest expense | 1,021 | 0.3 | % | 9,262 | 3.1 | % | ||||||||||
| Other income, net | (1,051 | ) | (0.3 | )% | (3 | ) | (0.0 | )% | ||||||||
| Operating income | 8,187 | 2.7 | % | 3,983 | 1.4 | % | ||||||||||
| Depreciation and amortization | 6,147 | 2.0 | % | 7,656 | 2.6 | % | ||||||||||
| Corporate restructuring and other | 11,677 | 3.9 | % | 2,434 | 0.8 | % | ||||||||||
| Unmitigated tariff costs(1) | 5,100 | 1.7 | % | 1,000 | 0.3 | % | ||||||||||
| JV intangible asset amortization | 5,090 | 1.7 | % | - | - | % | ||||||||||
| Unmitigated tariff recovery | (24,900 | ) | (8.2 | )% | - | - | % | |||||||||
| Gain on disposal of property and equipment | (3 | ) | (0.0 | )% | (11 | ) | (0.0 | )% | ||||||||
| Adjusted EBITDA | $ | 11,298 | 3.7 | % | $ | 15,062 | 5.1 | % | ||||||||
(1)Beginning in Fourth Quarter 2025, the Company adjusts for unmitigated tariff costs. Prior-period amounts have been recast on a comparable basis to reflect this adjustment.
| Unaudited | 26 Weeks Ended | |||||||||||||||
| (in thousands) | July 31, 2026 | August 1, 2025 | ||||||||||||||
| Net income (loss) | $ | 334,144 | 61.8 | % | $ | (11,929 | ) | (2.1 | )% | |||||||
| Income tax expense (benefit) | 106,765 | 19.7 | % | (4,971 | ) | (0.9 | )% | |||||||||
| Interest expense | 6,535 | 1.2 | % | 18,527 | 3.3 | % | ||||||||||
| Loss on extinguishment of debt | 9,172 | 1.7 | % | - | - | % | ||||||||||
| Gain on WHP Transaction | (491,622 | ) | (90.9 | )% | - | - | % | |||||||||
| Other income, net | (915 | ) | (0.2 | )% | (14 | ) | (0.0 | )% | ||||||||
| Operating (loss) income | (35,921 | ) | (6.6 | )% | 1,613 | 0.3 | % | |||||||||
| Depreciation and amortization | 12,247 | 2.3 | % | 15,947 | 2.9 | % | ||||||||||
| Corporate restructuring and other | 34,967 | 6.5 | % | 5,766 | 1.0 | % | ||||||||||
| Unmitigated tariff costs(1) | 11,900 | 2.2 | % | 1,000 | 0.2 | % | ||||||||||
| JV intangible asset amortization | 6,787 | 1.3 | % | - | - | % | ||||||||||
| Unmitigated tariff recovery | (24,900 | ) | (4.6 | )% | - | - | % | |||||||||
| Exit costs | - | - | % | 257 | 0.0 | % | ||||||||||
| Gain on disposal of property and equipment | (28 | ) | (0.0 | )% | - | - | % | |||||||||
| Adjusted EBITDA | $ | 5,052 | 0.9 | % | $ | 24,583 | 4.4 | % | ||||||||
(1)Beginning in Fourth Quarter 2025, the Company adjusts for unmitigated tariff costs. Prior-period amounts have been recast on a comparable basis to reflect this adjustment.
| Third Quarter Fiscal 2026 Guidance Adjusted EBITDA | 13 Weeks Ended | |||||||
| (in millions) | October 30, 2026 | |||||||
| Net (loss) income | $ | (1.0 | ) | - | $ | 3.0 | ||
| Depreciation, interest, other income, taxes and other significant items | 15.0 | - | 15.0 | |||||
| Adjusted EBITDA | $ | 14.0 | - | $ | 18.0 |
| Third Quarter Fiscal 2026 Guidance Adjusted Net Income and Adjusted Diluted Earnings per Share | 13 Weeks Ended | |||||||
| (in millions) | October 30, 2026 | |||||||
| Net (loss) income | $ | (1.0 | ) | - | $ | 3.0 | ||
| Restructuring and other significant items | 3.0 | - | 3.0 | |||||
| Adjusted net income | $ | 2.0 | - | $ | 6.0 | |||
| Adjusted diluted earnings per share | $ | 0.07 | - | $ | 0.20 |
| Fiscal 2026 Guidance Adjusted EBITDA | 52 Weeks Ended | |||||||
| (in millions) | January 29, 2027 | |||||||
| Net income | $ | 317.0 | - | $ | 325.0 | |||
| Depreciation, interest, other income, taxes and other significant items | (255.0 | ) | - | (255.0 | ) | |||
| Adjusted EBITDA | $ | 62.0 | - | $ | 70.0 |
| Fiscal 2026 Guidance Adjusted Net Income and Adjusted Diluted Earnings per Share | 52 Weeks Ended | |||||||
| (in millions) | January 29, 2027 | |||||||
| Net income | $ | 317.0 | - | $ | 325.0 | |||
| Restructuring and other significant items | (304.0 | ) | - | (304.0 | ) | |||
| Adjusted net income | $ | 13.0 | - | $ | 21.0 | |||
| Adjusted diluted earnings per share | $ | 0.44 | - | $ | 0.72 |
| LANDS' END, INC. Condensed Consolidated Statements of Cash Flows (Unaudited) | ||||||||
| 26 Weeks Ended | ||||||||
| (in thousands) | July 31, 2026 | August 1, 2025 | ||||||
| CASH FLOWS FROM OPERATING ACTIVITIES | ||||||||
| Net income (loss) | $ | 334,144 | $ | (11,929 | ) | |||
| Adjustments to reconcile net income (loss) to net cash (used in) provided by operating activities: | ||||||||
| Depreciation and amortization | 12,247 | 15,947 | ||||||
| Amortization of debt issuance costs | 424 | 1,391 | ||||||
| Gain on disposal of property and equipment | (28 | ) | - | |||||
| Equity method investment income | (4,439 | ) | - | |||||
| Distributions received from equity method investment | 2,411 | - | ||||||
| Gain on WHP Transaction | (491,622 | ) | - | |||||
| Loss on extinguishment of debt | 9,172 | - | ||||||
| Stock-based compensation | 2,867 | 2,250 | ||||||
| Deferred income taxes | 57,073 | (1,182 | ) | |||||
| Other | (346 | ) | (422 | ) | ||||
| Change in operating assets and liabilities: | ||||||||
| Accounts receivable, net | 2,745 | 9,363 | ||||||
| Inventories | (73,930 | ) | (35,420 | ) | ||||
| Accounts payable | 45,790 | 36,250 | ||||||
| Other operating assets | 3,387 | (1,343 | ) | |||||
| Other operating liabilities | 13,624 | (14,436 | ) | |||||
| Net cash (used in) provided by operating activities | (86,481 | ) | 469 | |||||
| CASH FLOWS FROM INVESTING ACTIVITIES | ||||||||
| Sales of property and equipment | 43 | 11 | ||||||
| Proceeds from WHP Transaction | 300,000 | - | ||||||
| Cash contribution to JV | (1,250 | ) | - | |||||
| Purchases of property and equipment | (24,013 | ) | (17,163 | ) | ||||
| Net cash provided by (used in) investing activities | 274,780 | (17,152 | ) | |||||
| CASH FLOWS FROM FINANCING ACTIVITIES | ||||||||
| Proceeds from borrowings under ABL Facility | 142,000 | 68,000 | ||||||
| Payments of borrowings under ABL Facility | (82,000 | ) | (33,000 | ) | ||||
| Payments on term loan | (234,000 | ) | (6,500 | ) | ||||
| Payments on debt extinguishment | (2,437 | ) | - | |||||
| Payments of debt issuance costs | - | (1,103 | ) | |||||
| Proceeds from exercise of stock options | 908 | - | ||||||
| Payments for taxes related to net share settlement of equity awards | (4,313 | ) | (810 | ) | ||||
| Purchases and retirement of common stock, including excise tax paid | (10,848 | ) | (4,513 | ) | ||||
| Net cash (used in) provided by financing activities | (190,690 | ) | 22,074 | |||||
| Effects of exchange rate changes on cash, cash equivalents and restricted cash | 811 | (657 | ) | |||||
| NET (DECREASE) INCREASE IN CASH, CASH EQUIVALENTS AND RESTRICTED CASH | (1,580 | ) | 4,734 | |||||
| CASH, CASH EQUIVALENTS AND RESTRICTED CASH, BEGINNING OF PERIOD | 18,283 | 18,812 | ||||||
| CASH, CASH EQUIVALENTS AND RESTRICTED CASH, END OF PERIOD | $ | 16,703 | $ | 23,546 | ||||
| SUPPLEMENTAL CASH FLOW DATA | ||||||||
| Unpaid liability to acquire property and equipment | $ | 4,085 | $ | 1,725 | ||||
| Income taxes paid (refunded) | 25,988 | (153 | ) | |||||
| Interest paid | 6,710 | 17,172 | ||||||
| Operating lease right-of-use-assets obtained in exchange for lease liabilities | 148 | 386 |
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