Bath & Body Works Drives progress on the Consumer First Formula across innovation, brand elevation, and marketplace expansion and Reports Fourth Quarter and Full-Year 2025 Results and Provides 2026 Guidance

Rhea-AI Summary

Bath & Body Works (NYSE: BBWI) reported fourth-quarter net sales of $2,724 million (down 2%) and diluted EPS of $1.99 (adjusted EPS $2.05/b). Full-year 2025 net sales were (down 0.2%) with diluted EPS of $3.11 (adjusted EPS $3.21/b).For fiscal 2026 the company guides net sales down 4.5% to 2.5%, EPS of $3.00 to $3.25 and adjusted EPS of $2.40 to $2.65. The company expects ~$600 million free cash flow and noted strategic actions including an earlier Amazon launch and brand rollout.

Positive

• Adjusted EPS 2025 of $3.21 (adjusted metric reported)
• Free cash flow guidance of approximately $600 million for fiscal 2026
• Cash balance increased to $953 million at Jan 31, 2026 from $674 million prior year
• Store footprint growth net increase to 1,927 company-operated stores and 573 partner-operated international stores

Negative

• Net income decline to $649 million in 2025 from $798 million in 2024 (-18.7%)
• Reported diluted EPS fell to $3.11 in 2025 from $3.61 in 2024 (-13.9%)
• Operating income decreased to $1,126 million in 2025 from $1,266 million in 2024 (-11.1%)
• 2026 adjusted EPS guidance of $2.40–$2.65 implies a material decline versus adjusted $3.21 in 2025

News Market Reaction – BBWI

+2.59%

3 alerts

+2.59% News Effect

+$116M Valuation Impact

$4.59B Market Cap

24K Volume

On the day this news was published, BBWI gained 2.59%, reflecting a moderate positive market reaction. Our momentum scanner triggered 3 alerts that day, indicating moderate trading interest and price volatility. This price movement added approximately $116M to the company's valuation, bringing the market cap to $4.59B at that time.

Data tracked by StockTitan Argus on the day of publication.

Key Figures

Q4 2025 net sales: $2,724M (down 2%) Q4 2025 EPS: $1.99 (adj. $2.05) FY 2025 net sales: $7,291M (down 0.2%) +5 more

8 metrics

Q4 2025 net sales $2,724M (down 2%) Quarter ended Jan 31, 2026 vs $2,788M prior year

Q4 2025 EPS $1.99 (adj. $2.05) Earnings per diluted share; adjusted excludes $15M transformation costs

FY 2025 net sales $7,291M (down 0.2%) Year ended Jan 31, 2026 vs $7,307M prior year

FY 2025 EPS $3.11 (adj. $3.21) Reported vs adjusted EPS; prior year adjusted EPS $3.29

2026 net sales guidance Down 4.5% to 2.5% Versus FY 2025 net sales of $7,291M

2026 EPS guidance $3.00–$3.25 (adj. $2.40–$2.65) Compared to FY 2025 EPS $3.11 and adjusted EPS $3.21

Expected 2026 free cash flow $600M Company’s fiscal 2026 outlook

2025 share repurchases 15.1M shares for $400M Repurchases of common stock in fiscal 2025

Market Reality Check

Price: $23.01 Vol: Volume 6,229,292 is 21% a...

normal vol

$23.01 Last Close

Volume Volume 6,229,292 is 21% above the 20-day average of 5,143,993 shares. normal

Technical Price at $22.43, trading below the 200-day MA of $25.65 and 39.2% under the 52-week high.

Peers on Argus

BBWI gained 1.77% ahead of results. Key specialty retail peers like MUSA (+3.11%...

1 Down

BBWI gained 1.77% ahead of results. Key specialty retail peers like MUSA (+3.11%), RH (+2.57%), FIVE (+2.11%), ASO (+2.79%) and MNSO (+0.90%) were also positive, but momentum scanners only flagged one unrelated peer, suggesting stock-specific focus on BBWI’s earnings and 2026 outlook.

Historical Context

5 past events · Latest: Feb 27 (Positive)

Pattern 5 events

Date	Event	Sentiment	Move	Catalyst
Feb 27	PEEPS® collaboration launch	Positive	-2.4%	Limited-time PEEPS® spring collection across body care and home fragrance.
Feb 20	Amazon storefront launch	Positive	+1.0%	Official launch of authorized Bath & Body Works storefront on Amazon U.S.
Feb 18	Earnings date announcement	Neutral	-3.1%	Announcement of Q4 and fiscal 2025 earnings release date and call details.
Feb 11	Disney collection launch	Positive	-0.3%	Debut of Disney Princess Collection with new and returning fragrances.
Feb 06	Dividend declaration	Positive	+3.6%	Regular quarterly cash dividend of <b>$0.20</b> per share announced.

Pattern Detected

Recent product and partnership announcements have sometimes seen negative short-term reactions despite generally positive commercial themes.

Recent Company History

Over the past few months, Bath & Body Works has focused on product collaborations and channel expansion while executing its Consumer First Formula. Launches such as the Disney Princess Collection and a PEEPS® collaboration, along with the official Amazon U.S. storefront debut, highlight efforts to diversify assortments and broaden distribution. A $0.20 quarterly dividend declared on Feb 6, 2026 underscores ongoing capital returns. Against this backdrop, the latest quarter and 2025 results provide a fuller picture of how these initiatives translate into sales, earnings and guidance.

Market Pulse Summary

This announcement detailed Q4 and full-year 2025 performance alongside a reset 2026 outlook. Net sal...

Analysis

This announcement detailed Q4 and full-year 2025 performance alongside a reset 2026 outlook. Net sales were $2.724B in Q4 and $7.291B for 2025, with EPS of $1.99 for Q4 and $3.11 for the year, and adjusted figures modestly ahead of guidance. Management forecast 2026 net sales down 4.5% to 2.5% and adjusted EPS of $2.40–$2.65, while expecting about $600M of free cash flow. Investors may track progress on the Consumer First Formula, margin trends, and the impact of Amazon and international expansion against this guidance baseline.

Key Terms

free cash flow, operating income, net income, operating lease liabilities, +3 more

7 terms

free cash flow financial

"In fiscal 2026, we expect to generate free cash flow of approximately $600 million."

Free cash flow is the amount of money a company has left over after paying all its expenses and investing in its business, like buying equipment or updating facilities. It shows how much cash is available to reward shareholders, pay down debt, or save for future growth. This helps investors understand if a company is financially healthy and able to grow.

operating income financial

"Fourth quarter operating income was $599 million compared to $678 million last year"

Operating income is the profit a company earns from its regular business activities after subtracting the costs directly related to running the business, such as wages, rent, and supplies. It shows how well the core operations are performing, ignoring income or expenses from non-regular activities like investments or one-time events. Investors use it to assess the company's efficiency and profitability from its main work.

net income financial

"and net income was $403 million compared to $453 million last year."

Net income is the amount of money a company keeps after paying all its costs, interest, taxes and one-time charges — effectively the company’s profit “left over” at the end of a reporting period. Investors use it like a report card: it shows whether the business is generating real profit, influences earnings per share and dividend potential, and helps determine valuation and long-term financial health.

operating lease liabilities financial

"Long-term Operating Lease Liabilities | | 867 | | 883"

Long-term lease payments a company is legally committed to because it rents assets such as offices, factories, or equipment; under modern accounting rules these future rent obligations are recorded on the balance sheet as liabilities. Investors care because operating lease liabilities act like debt that drains future cash, affects measures of leverage and borrowing capacity, and can change profitability and valuation — think of them as a company’s large, ongoing rent payments that limit its financial flexibility.

loss on extinguishment of debt financial

"Loss on Extinguishment of Debt | | — | | 10"

Loss on extinguishment of debt is the accounting hit a company records when it retires or restructures a loan or bond for an amount that exceeds the debt’s recorded value—like paying more than the remaining balance to settle a loan early. It matters to investors because it reduces reported profit and can use cash, but may also cut future interest costs or signal financial stress; understanding it helps assess earnings quality and balance-sheet strength.

non-gaap financial measures financial

"See Notes to Reconciliation of GAAP Financial Measures to Non-GAAP Financial Measures."

Non-GAAP financial measures are numbers companies use to show their financial performance that exclude certain expenses or income. They help investors see how the company might perform without one-time costs or other unusual items, giving a different perspective from official reports. However, since they can be adjusted, they don’t always tell the full story and should be looked at alongside standard financial figures.

forward-looking statements regulatory

"We caution that any forward-looking statements (as such term is defined in the Private"

Forward-looking statements are predictions or plans that companies share about what they expect to happen in the future, like estimating sales or profits. They matter because they help investors understand a company's outlook, but since they are based on guesses and assumptions, they can sometimes be wrong.

AI-generated analysis. Not financial advice.

03/04/2026 - 06:55 AM

• Delivers Q4 net sales and earnings per share results above guidance
• Fourth quarter net sales of $2.7 billion, down 2%. Earnings per diluted share of $1.99; Adjusted earnings per diluted share of $2.05
• Provides full-year 2026 guidance of net sales down 4.5% to down 2.5%, earnings per diluted share of $3.00 to $3.25; and adjusted earnings per diluted share of $2.40 to $2.65
  

COLUMBUS, Ohio, March 04, 2026 (GLOBE NEWSWIRE) -- Bath & Body Works, Inc. (NYSE: BBWI) today reported fourth quarter and full-year 2025 results.

Daniel Heaf, chief executive officer of Bath & Body Works, commented, “Our fourth quarter results exceeded the guidance we provided. Since launching the Consumer First Formula in the third quarter, we have moved with urgency to accelerate innovation in our hero categories, refresh and modernize our brand, expand distribution, and simplify our operating model. The earlier-than-planned launch on Amazon and the rollout of our new brand identity are clear examples of our team’s focused execution.”

Heaf continued, “We are making progress, but transformations of this scale take time. We are undertaking a comprehensive, end-to-end evolution of our business - building a Bath & Body Works that is more innovative, more relevant, and easier to shop. This work lays the foundation for sustained, long-term growth as we reposition the company from a specialty retailer to a premier global brand.”

Fourth Quarter 2025 Results

The company reported net sales of $2,724 million for the quarter ended January 31, 2026, a decrease of 2% compared to net sales of $2,788 million for the quarter ended February 1, 2025.

Earnings per diluted share were $1.99 for the fourth quarter of 2025, compared to $2.09 last year. Fourth quarter operating income was $599 million compared to $678 million last year, and net income was $403 million compared to $453 million last year.

Reported fourth quarter 2025 results included pre-tax costs of $15 million ($12 million after tax) associated with business transformation activities. Excluding this item, adjusted earnings per diluted share for the fourth quarter of 2025 was $2.05, adjusted operating income was $614 million and adjusted net income was $415 million.

At the conclusion of this press release is a reconciliation of reported‐to‐adjusted results, including a description of the adjusted items.

Full-Year 2025 Results

The company reported net sales of $7,291 million for the year ended January 31, 2026, a decrease of 0.2% compared to net sales of $7,307 million for the year ended February 1, 2025.

Earnings per diluted share were $3.11 for the year, compared to $3.61 in 2024. Full-year operating income was $1,126 million compared to $1,266 million last year, and net income was $649 million compared to $798 million last year. In fiscal 2025, the company repurchased 15.1 million shares of common stock for $400 million.

Reported full-year 2025 results included pre-tax costs of $15 million ($14 million after tax) associated with the transition of certain members of the leadership team, an $8 million pre-tax gain ($6 million after tax) associated with the sale of a non-core asset and pre-tax costs of $15 million ($12 million after tax) associated with business transformation activities.

Reported full-year 2024 results include a $39 million pre-tax gain ($25 million after tax) related to the sales of certain Easton investments and a $44 million tax benefit related to the release of a valuation allowance on a deferred tax asset.

Excluding these items, adjusted full-year earnings per diluted share was $3.21 in 2025 compared to $3.29 last year, adjusted full-year operating income of $1,156 million compared to $1,266 million last year and adjusted full-year net income was $669 million in 2025 compared to $729 million last year.

At the conclusion of this press release is a reconciliation of reported‐to‐adjusted results, including a description of the adjusted items.

2026 Guidance

For fiscal 2026, the company is forecasting net sales to decline between 4.5% to 2.5% compared to $7,291 million in fiscal 2025. Full-year 2026 earnings per diluted share is expected to be between $3.00 and $3.25 compared to $3.11 in fiscal 2025. The company’s full-year outlook includes the interest savings from the redemption of the remaining $284 million outstanding notional of our January 2027 bonds. There are no share repurchases assumed in our outlook. In fiscal 2026, we expect to generate free cash flow of approximately $600 million.

We expect that our 2026 results will include an $88 million pre-tax gain ($65 million after tax) related to cash proceeds received, net of legal fees, for a favorable settlement of payment card interchange fee litigation, a $62 million tax benefit associated with the resolution of certain tax matters, and a $9 million pre-tax loss ($7 million after tax) associated with the anticipated redemption of our January 2027 bonds.

Excluding these items, forecasted adjusted earnings per diluted share for the full-year 2026 is expected to be between $2.40 and $2.65, compared to adjusted earnings per share of $3.21 in full-year 2025.

For the first quarter of fiscal 2026, the company is forecasting net sales to decline between 6% to 4% compared to $1,424 million in the first quarter of 2025. First quarter 2026 earnings per diluted share is expected to be between $0.84 and $0.90 compared to $0.49 in the first quarter of 2025. Excluding the items referenced above, forecasted adjusted earnings per diluted share for the first quarter of 2026 is expected to be between $0.24 and $0.30, compared to earnings per diluted share of $0.49 in the first quarter of 2025.

At the conclusion of this press release is a reconciliation of our guidance-to-adjusted guidance, including a description of the adjusted items.

Earnings Call and Additional Information

Bath & Body Works, Inc. will conduct its fourth quarter earnings call at 8:30 a.m. ET on March 4. To listen, call 877-407-9219 (international dial-in number: 412-652-1274). For an audio replay, call 877-660-6853 (international replay number: 201-612-7415); access code 13758304 or log onto www.BBWInc.com. A slide presentation has been posted on the company’s Investor Relations website that summarizes certain information in the company‘s prepared remarks from the earnings call as well as some additional facts and figures regarding the company’s operating performance and guidance.

ABOUT BATH & BODY WORKS
Bath & Body Works is a global leader in personal care and home fragrance, driven by the belief that everybody deserves to feel good.

The brand’s beloved and iconic scents are expertly crafted for exceptional performance and a luxury fragrance experience. Formulated with thoughtfully chosen ingredients, Bath & Body Works’ body care products are available in multiple forms including fine fragrance mist, body cream, lotion, eau de parfum, body wash, hand soap, sanitizer and more. The brand’s famous 3-wick candles are made with rich, high quality fragrance oils layered throughout a premium soy wax base, for up to 45 hours of room-filling fragrance.

Consumers can shop Bath & Body Works anytime and anywhere they choose, from welcoming, in-store experiences at more than 1,900 stores in the U.S. and Canada, 500-plus international locations, online at bathandbodyworks.com and on Amazon.

Safe Harbor Statement Under the Private Securities Litigation Reform Act of 1995

We caution that any forward-looking statements (as such term is defined in the Private Securities Litigation Reform Act of 1995) contained in this press release or made by our Company or our management involve risks and uncertainties and are subject to change based on various factors, many of which are beyond our control. Accordingly, our future performance and financial results may differ materially from those expressed or implied in any such forward-looking statements. Words such as “estimate,” “project,” “plan,” “believe,” “expect,” “anticipate,” “intend,” “potential,” “target,” “goal” and any similar expressions may identify forward-looking statements. There are risks, uncertainties and other factors that in some cases have affected and, in the future, could affect our financial performance and actual results and could cause actual results to differ materially from those expressed or implied in any forward-looking statements included in this report or otherwise made by the Company or our management. These factors can be found in Item 1A. Risk Factors in our 2024 Annual Report on Form 10-K and our subsequent filings.

We are not under any obligation and do not intend to make publicly available any update or other revisions to any of the forward-looking statements contained in this press release to reflect circumstances existing after the date of this press release or to reflect the occurrence of future events even if experience or future events make it clear that any expected results expressed or implied by those forward-looking statements will not be realized.

We announce material financial and operational information using our investor relations website, press releases, SEC filings and public conference calls and webcasts.  Information about the Company, our business and our results of operations may also be announced by posts on our accounts on social media channels, including the following: Facebook, Instagram, X, LinkedIn, Pinterest, TikTok and YouTube.   The information that we post through these social media channels and on our website may be deemed material.  As a result, we encourage investors, the media and others interested in the Company to monitor these social media channels in addition to following our investor relations website, press releases, SEC filings and public conference calls and webcasts.  The list of social media channels we use may be updated from time to time on our investor relations website. 

For further information, please contact:

Bath & Body Works, Inc.:
Luke Long
InvestorRelations@bbw.com

Media Relations
Emmy Beach
Communications@bbw.com

BATH & BODY WORKS, INC.
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
(In millions, except per share amounts)
	Fourth Quarter								Full-Year
		2025				2024				2025				2024
Net Sales	$	2,724			$	2,788			$	7,291			$	7,307
Costs of Goods Sold, Buying and Occupancy		(1,480	)			(1,487	)			(4,102	)			(4,073	)
Gross Profit		1,244				1,301				3,189				3,234
General, Administrative and Store Operating Expenses		(645	)			(623	)			(2,063	)			(1,968	)
Operating Income		599				678				1,126				1,266
Interest Expense		(68	)			(76	)			(276	)			(312	)
Other Income, Net		7				10				32				74
Income Before Income Taxes		538				612				882				1,028
Provision for Income Taxes		(135	)			(159	)			(233	)			(230	)
Net Income	$	403			$	453			$	649			$	798
Net Income Per Diluted Share	$	1.99			$	2.09			$	3.11			$	3.61
Weighted Average Diluted Shares Outstanding		203				217				209				221

BATH & BODY WORKS, INC.
CONSOLIDATED CONDENSED BALANCE SHEETS
(Unaudited)
(In millions)
	January 31, 2026				February 1, 2025
ASSETS
Current Assets:
Cash and Cash Equivalents	$	953			$	674
Accounts Receivable, Net		180				205
Inventories		699				734
Easton Assets Held for Sale		81				96
Other		106				114
Total Current Assets		2,019				1,823
Property and Equipment, Net		1,127				1,127
Operating Lease Assets		941				949
Goodwill		628				628
Trade Name		165				165
Deferred Income Taxes		112				130
Other Assets		77				50
Total Assets	$	5,069			$	4,872
LIABILITIES AND EQUITY (DEFICIT)
Current Liabilities:
Accounts Payable	$	465			$	338
Accrued Expenses and Other		579				584
Current Debt		280				—
Current Operating Lease Liabilities		195				192
Income Taxes		72				117
Total Current Liabilities		1,591				1,231
Deferred Income Taxes		65				24
Long-term Debt		3,612				3,884
Long-term Operating Lease Liabilities		867				883
Other Long-term Liabilities		213				233
Total Equity (Deficit)		(1,279	)			(1,383	)
Total Liabilities and Equity (Deficit)	$	5,069			$	4,872

BATH & BODY WORKS, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(In millions)
	Full-Year
		2025				2024
Operating Activities:
Net Income	$	649			$	798
Adjustments to Reconcile Net Income to Net Cash Provided by Operating Activities:
Depreciation of Long-lived Assets		254				282
Share-based Compensation Expense		31				40
Gain on Sale of Non-core Asset		(8	)			—
Gain on Sales of Easton Investments		—				(39	)
Loss on Extinguishment of Debt		—				10
Deferred Income Taxes		63				(112	)
Changes in Assets and Liabilities:
Accounts Receivable		25				18
Inventories		37				(26	)
Accounts Payable, Accrued Expenses and Other		111				(50	)
Income Taxes Payable		(57	)			(23	)
Other Assets and Liabilities		(3	)			(12	)
Net Cash Provided by Operating Activities	$	1,102			$	886
Investing Activities:
Capital Expenditures	$	(237	)		$	(226	)
Proceeds from Sale of Non-core Asset		9				—
Proceeds from Sales of Easton Investments, Net of Fees Paid		—				40
Other Investing Activities		1				24
Net Cash Used for Investing Activities	$	(227	)		$	(162	)
Financing Activities:
Payments for Long-term Debt	$	—			$	(522	)
Repurchases of Common Stock		(401	)			(401	)
Dividends Paid		(167	)			(177	)
Payments of Finance Lease Obligations		(14	)			(17	)
Tax Payments related to Share-based Awards		(8	)			(16	)
Other Financing Activities		(9	)			1
Net Cash Used for Financing Activities	$	(599	)		$	(1,132	)
Effects of Exchange Rate Changes on Cash and Cash Equivalents	$	3			$	(2	)
Net Increase (Decrease) in Cash and Cash Equivalents		279				(410	)
Cash and Cash Equivalents, Beginning of Year		674				1,084
Cash and Cash Equivalents, End of Year	$	953			$	674

BATH & BODY WORKS, INC.
Fourth Quarter 2025
Total Sales (In millions):
	Fourth Quarter									Full-Year
		2025			2024		% Change				2025			2024		% Change
Stores - U.S. and Canada (a)	$	2,054		$	2,109		(2.6	%)		$	5,582		$	5,534		0.9	%
Direct - U.S. and Canada		579			595		(2.5	%)			1,395			1,474		(5.4	%)
International (b)		91			84		8.6	%			314			299		4.9	%
Total Bath & Body Works	$	2,724		$	2,788		(2.3	%)		$	7,291		$	7,307		(0.2	%)

________________

(a) Results include fulfilled buy online-pick up in store orders.

(b) Results include royalties associated with franchised stores and wholesale sales.

Total Company-operated Stores:
	Stores							Stores
	2/1/2025		Opened		Closed			1/31/2026
United States	1,782		94		(62	)		1,814
Canada	113		—		—			113
Total Bath & Body Works	1,895		94		(62	)		1,927

Total Partner-operated Stores:
	Stores							Stores
	2/1/2025		Opened		Closed			1/31/2026
International	494		70		(28	)		536
International - Travel Retail	35		4		(2	)		37
Total International (a)	529		74		(30	)		573

________________

(a) Includes store locations only and does not include kiosks, shop-in-shops, gondola or beauty counter locations.

BATH & BODY WORKS, INC.
ADJUSTED FINANCIAL INFORMATION
(Unaudited)
(In millions, except per share amounts)
	Fourth Quarter							Full-Year
		2025				2024			2025				2024
Reconciliation of Reported Operating Income to Adjusted Operating Income
Reported Operating Income	$	599			$	678		$	1,126			$	1,266
Business Transformation Activities		15				—			15				—
Leadership Transition Costs		—				—			15				—
Adjusted Operating Income	$	614			$	678		$	1,156			$	1,266
Reconciliation of Reported Net Income to Adjusted Net Income
Reported Net Income	$	403			$	453		$	649			$	798
Business Transformation Activities		15				—			15				—
Leadership Transition Costs		—				—			15				—
Gain on Sale of Non-core Asset		—				—			(8	)			—
Gain on Sales of Easton Investments		—				—			—				(39	)
Tax Effect of Adjustments		(3	)			—			(2	)			14
Tax Benefit from Valuation Allowance Release		—				—			—				(44	)
Adjusted Net Income	$	415			$	453		$	669			$	729
Reconciliation of Reported Net Income Per Diluted Share to Adjusted Net Income Per Diluted Share
Reported Net Income Per Diluted Share	$	1.99			$	2.09		$	3.11			$	3.61
Business Transformation Activities		0.07				—			0.07				—
Leadership Transition Costs		—				—			0.07				—
Gain on Sale of Non-core Asset		—				—			(0.04	)			—
Gain on Sales of Easton Investments		—				—			—				(0.18	)
Tax Effect of Adjustments		(0.01	)			—			(0.01	)			0.06
Tax Benefit from Valuation Allowance Release		—				—			—				(0.20	)
Adjusted Net Income Per Diluted Share	$	2.05			$	2.09		$	3.21			$	3.29

See Notes to Reconciliation of GAAP Financial Measures to Non-GAAP Financial Measures.

BATH & BODY WORKS, INC.
FORECASTED ADJUSTED FINANCIAL INFORMATION
(Unaudited)
(In millions, except per share amounts)
		First Quarter								Full-Year
			2026								2026
Reconciliation of Forecasted Net Income Per Diluted Share to Forecasted Adjusted Net Income Per Diluted Share
		Low				High				Low				High
Forecasted Net Income Per Diluted Share		$	0.84			$	0.90			$	3.00			$	3.25
Interchange Fee Settlement			(0.43	)			(0.43	)			(0.43	)			(0.43	)
Loss on Extinguishment of Debt			0.04				0.04				0.04				0.04
Tax Effect of Adjustments			0.10				0.10				0.10				0.10
Tax Benefit from the Resolution of Certain Tax Matters			(0.31	)			(0.31	)			(0.31	)			(0.31	)
Forecasted Adjusted Net Income Per Diluted Share		$	0.24			$	0.30			$	2.40			$	2.65
														Full-Year
															2026
Reconciliation of Forecasted Net Cash Provided by Operating Activities to Forecasted Free Cash Flow
Forecasted Net Cash Provided by Operating Activities														$	870
Forecasted Capital Expenditures															(270	)
Forecasted Free Cash Flow														$	600

See Notes to Reconciliation of GAAP Financial Measures to Non-GAAP Financial Measures.

BATH & BODY WORKS, INC.

NOTES TO RECONCILIATION OF GAAP FINANCIAL MEASURES

TO NON-GAAP FINANCIAL MEASURES

(Unaudited)

The adjusted financial information should not be construed as an alternative to the results determined in accordance with generally accepted accounting principles. Further, the company’s definitions of adjusted income information may differ from similarly titled measures used by other companies. Management believes that the presentation of adjusted financial information provides additional information to investors to facilitate the comparison of past and present operations. While it is not possible to predict future results, management believes the adjusted financial information is useful for the assessment of the operations of the company because the adjusted items are not indicative of the company’s ongoing operations due to their size and nature. Additionally, management uses adjusted financial information as key performance measures for the purpose of evaluating performance internally. The adjusted financial information should be read in conjunction with the company’s historical financial statements and notes thereto contained in the company’s Quarterly Reports on Form 10-Q and Annual Report on Form 10-K.

The “Adjusted Financial Information” provided in the attached reflects the following non-GAAP financial measures:

Fiscal 2025

In the fourth quarter of 2025, adjusted results exclude the following:

• Aggregate pre-tax costs of $15 million ($12 million net of tax of $3 million), primarily included in general, administrative and store operating expenses, resulting from business transformation activities in connection with the Consumer First Formula. These costs primarily related to severance benefits.
  

In the third quarter of 2025, adjusted results exclude the following:

• An $8 million pre-tax gain ($6 million net of tax of $2 million), included in other income, net, related to the sale of a non-core asset.
  

In the second quarter of 2025, adjusted results exclude the following:

• Aggregate pre-tax costs of $15 million ($14 million net of tax of $1 million), included in general, administrative and store operating expenses, due to the transition of certain members of the leadership team, primarily related to severance benefits.
  

There were no adjustments to results in the first quarter of 2025.

Fiscal 2024

There were no adjustments to results in the first, third or fourth quarters of 2024.

In the second quarter of 2024, adjusted results exclude the following:

• A $39 million aggregate pre-tax gain ($25 million net of tax of $14 million), included in other income, net, related to the sales of certain Easton investments; and
• A $44 million tax benefit related to the release of a valuation allowance on a deferred tax asset.

The “Forecasted Adjusted Financial Information” provided in the attached reflects the following non-GAAP financial measures:

Fiscal 2026

The 2026 forecasted adjusted results exclude the following items, which we expect to recognize in the first quarter of fiscal 2026:

• An $88 million pre-tax gain ($65 million net of tax of $23 million), which will be included in general, administrative and store operating expenses, related to cash proceeds received, net of legal fees, for a favorable settlement of payment card interchange fee litigation;
• A $9 million pre-tax loss ($7 million net of tax of $2 million), which will be included in other income, net, associated with the anticipated early extinguishment of outstanding notes; and
• A $62 million tax benefit associated with the resolution of certain tax matters.
  

Our Forecasted Free Cash Flow is defined as Forecasted Net Cash Provided by Operating Activities less our Forecasted Capital Expenditures. Our Forecasted Free Cash Flow is a non-GAAP financial measure which we believe is useful to analyze our anticipated ability to generate cash. Our Forecasted Free Cash Flow calculation may not be comparable to similarly titled measures reported by other companies. Our Forecasted Free Cash Flow should be evaluated in addition to, and not considered a substitute for, other GAAP financial measures.

FAQ

What were Bath & Body Works (BBWI) fourth-quarter 2025 sales and EPS results?

BBWI reported Q4 2025 net sales of $2,724 million and diluted EPS of $1.99. According to the company, adjusted Q4 EPS was $2.05, with operating income of $599 million and a $15 million pre-tax transformation charge included.

What full-year 2025 guidance did Bath & Body Works (BBWI) provide for fiscal 2026?

BBWI guided fiscal 2026 net sales down 4.5% to 2.5% and EPS of $3.00–$3.25. According to the company, adjusted EPS is expected to be $2.40–$2.65 and free cash flow about $600 million.

How did Bath & Body Works (BBWI) adjusted earnings per share change year-over-year?

Adjusted EPS fell to $3.21 in 2025 from $3.29 in 2024 on an adjusted basis. According to the company, adjusted full-year results exclude transformation, leadership transition items, and certain gains.

What is Bath & Body Works (BBWI) first-quarter 2026 outlook for sales and EPS?

BBWI forecasts Q1 2026 net sales to decline 6%–4% versus $1,424 million in Q1 2025 and diluted EPS of $0.84–$0.90. According to the company, adjusted Q1 EPS is expected to be $0.24–$0.30 excluding special items.

Did Bath & Body Works (BBWI) repurchase shares in fiscal 2025 and are repurchases in 2026 assumed?

The company repurchased 15.1 million shares for $400 million in fiscal 2025. According to the company, no share repurchases are assumed in the 2026 outlook.

What one-time items did Bath & Body Works (BBWI) include in its 2026 outlook?

BBWI expects an $88 million pre-tax gain from interchange litigation proceeds, a $62 million tax benefit, and a $9 million pre-tax loss on bond redemption. According to the company, these items are excluded from adjusted EPS guidance.