G-III (NASDAQ:GIII) Falls Short of Q4 CY2025 Revenue Expectations, Shares Decline 12.3%

G-III (NASDAQ:GIII) Q4 CY2025 Earnings Recap

G-III, a major player in the fashion industry, reported fourth-quarter results for calendar year 2025 that fell short of Wall Street’s revenue projections. The company posted sales of $771.5 million, representing an 8.1% decrease compared to the same period last year. However, G-III’s full-year revenue forecast of $2.71 billion was largely in line with analyst expectations. Adjusted earnings per share came in at $0.30, which was 49% below consensus estimates.

Is this a good moment to consider investing in G-III?

Highlights from G-III’s Q4 CY2025 Report

• Revenue: $771.5 million, missing analyst expectations of $792 million (an 8.1% year-over-year drop and a 2.6% shortfall)
• Adjusted EPS: $0.30, well below the anticipated $0.59 (a 49% miss)
• Guidance for Adjusted EPS (FY2027): Midpoint of $2.05, which is 30% under analyst projections
• EBITDA Guidance (FY2027): $160 million at the midpoint, compared to analyst expectations of $214.2 million
• Operating Margin: -3.8%, down from 8.5% in the prior year’s quarter
• Market Cap: $1.25 billion

Morris Goldfarb, Chairman and CEO of G-III, commented, “Fiscal 2026 marked a significant year for our company. The global strength of our brands, combined with disciplined operations and a robust balance sheet, allowed us to achieve solid results despite a tough market. Our core brands led the way, delivering higher-quality revenue, better full-price sell-throughs, and increasing international relevance. I’m proud of our team’s accomplishments and the strides we’ve made toward our long-term objectives.”

About G-III

G-III (NASDAQ:GIII) began as a small leather goods company and has grown into a leading fashion and apparel group, managing a wide array of brands.

Revenue Trends

Long-term sales growth is a key indicator of a company’s strength. While short-term gains can happen, sustained expansion is a hallmark of a high-quality business. Over the past five years, G-III’s revenue increased at a modest compounded annual rate of 7.5%, which is below the typical benchmark for consumer discretionary firms and sets a challenging context for evaluation.

At StockStory, we prioritize long-term growth, but it’s important to recognize that consumer-focused companies can sometimes benefit from new trends or products. G-III’s recent performance shows that while it experienced growth in the past, it has lost ground over the last two years, with annual revenue declining by 2.3%.

For the most recent quarter, G-III missed analyst forecasts, reporting an 8.1% year-over-year drop in revenue to $771.5 million.

Looking Forward

Analysts predict that G-III’s revenue will decrease by 7% over the next year, which is a steeper decline than seen in the previous two years. This outlook suggests the company may face ongoing challenges in generating demand for its products and services.

Profitability: Operating Margin

Operating margin is a crucial measure of profitability, reflecting earnings before taxes and interest. Over the past year, G-III’s operating margin has narrowed, averaging 6.5% over the last two years—a middling result for a consumer discretionary company. This indicates the company has struggled to offset rising operating costs.

In the latest quarter, G-III’s operating margin was negative 3.8%, a sharp decline of 12.3 percentage points from the previous year, highlighting increased inefficiency as expenses outpaced revenue.

Earnings Per Share (EPS) Performance

We monitor long-term EPS growth to assess profitability alongside revenue trends. Over the last five years, G-III’s EPS grew at a compounded annual rate of 34%, outpacing its revenue growth. However, this improvement in EPS did not coincide with better operating margins, limiting its significance as a quality indicator.

In Q4, adjusted EPS dropped to $0.30 from $1.27 a year earlier, missing analyst expectations. While short-term EPS fluctuations matter, we focus more on sustained growth. Wall Street anticipates G-III’s full-year EPS will rise 14.9% to $2.64 over the next 12 months.

Summary and Investment Considerations

Overall, G-III’s latest results were underwhelming, with both EBITDA guidance and EPS falling short of expectations. Following the announcement, shares fell 12.3% to $25.93. While the recent quarter was disappointing, investors should weigh these results against the company’s long-term fundamentals and valuation before making any decisions.

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