Bath & Body Works Reports First Quarter Results Exceeding Guidance and Progress Against the Consumer First Formula
Rhea-AI Summary
Bath & Body Works (NYSE:BBWI) reported first-quarter 2026 results with net sales of $1.378 billion, down 3% year over year, and earnings per diluted share of $0.90.
Adjusted EPS was $0.32, above guidance. The company reaffirmed full-year 2026 sales, EPS and free cash flow guidance and announced CFO Eva Boratto will step down June 12, with Tom Javitch named interim CFO.
AI-generated analysis. Not financial advice.
Positive
- Q1 2026 net sales of $1.378 billion, exceeding prior guidance
- Q1 2026 earnings per diluted share of $0.90 versus $0.49 in 2025
- Q1 2026 operating income of $231 million versus $209 million in 2025
- Net income of $183 million in Q1 2026 versus $105 million in 2025
- Cash from operating activities of $244 million versus $188 million in Q1 2025
- Long-term debt reduced to $3.613 billion from $3.886 billion year over year
- Full-year 2026 EPS guidance of $3.00–$3.25 versus $3.11 in 2025
- Company expects approximately $600 million of free cash flow in fiscal 2026
Negative
- Q1 2026 total net sales declined 3.2% year over year to $1.378 billion
- Q1 2026 adjusted operating income of $151 million versus $209 million in 2025
- Full-year 2026 net sales expected to decline 4.5% to 2.5% versus 2025
- Full-year 2026 adjusted EPS guidance of $2.40–$2.65 versus $3.21 in 2025
- Q2 2026 net sales forecast to decline 5% to 3% versus Q2 2025
- Q2 2026 EPS expected at $0.20–$0.25 versus EPS of $0.30 in Q2 2025
- Chief Financial Officer Eva Boratto to leave the company effective June 12, 2026
News Market Reaction – BBWI
On the day this news was published, BBWI gained 9.70%, reflecting a notable positive market reaction. Argus tracked a peak move of +14.9% during that session. Our momentum scanner triggered 17 alerts that day, indicating notable trading interest and price volatility. This price movement added approximately $316M to the company's valuation, bringing the market cap to $3.57B at that time.
Data tracked by StockTitan Argus on the day of publication.
Key Figures
Market Reality Check
Peers on Argus
Sector peers showed mixed moves, with MNSO down about 3.24% and limited momentum elsewhere. With only one peer in the momentum scan and no same-day peer news, BBWI’s setup appears more company-specific than part of a broad Specialty Retail move.
Previous Earnings Reports
| Date | Event | Sentiment | Move | Catalyst |
|---|---|---|---|---|
| May 29 | Q1 2025 earnings | Positive | -6.2% | Stronger Q1 sales and EPS with maintained full-year 2025 guidance. |
| Nov 25 | Q3 2024 earnings | Positive | +16.5% | Q3 beat on sales and EPS with raised full-year 2024 guidance. |
| Aug 28 | Q2 2024 earnings | Neutral | -7.0% | Q2 EPS beat but lower sales and guidance for 2024 net sales decline. |
| Jun 04 | Q1 2024 earnings | Positive | -12.8% | Raised 2024 EPS guidance despite slightly lower Q1 sales year over year. |
Earnings releases often skew positive fundamentally but have more frequently been met with negative price reactions, suggesting a pattern of sell-the-news or skepticism toward guidance.
Across the last four earnings-related announcements since June 2024, Bath & Body Works has generally reported solid profitability with either maintained or adjusted guidance. Events included Q1 and Q2 2024 updates, a strong Q3 2024 beat with raised guidance, and robust Q1 2025 results with net sales around $1.4 billion and EPS rising to $0.49. Despite this, three of these four earnings reports saw negative next-day moves, framing today’s results within a history of cautious market reactions.
Historical Comparison
In the past year, BBWI’s four earnings releases produced an average move of -2.38%. This context shows that even fundamentally solid results have often faced skeptical or selling pressure from the market.
Recent earnings updates trace a shift from modest growth in 2024 to maintained or more cautious guidance, with recurring emphasis on profitability and cash returns while the stock has frequently sold off on otherwise solid reports.
Market Pulse Summary
The stock moved +9.7% in the session following this news. A strong positive reaction aligns with prior instances where solid earnings and cash flow supported optimism, even as sales trends softened. Past earnings reports saw an average move of -2.38%, so a sharp gain would mark a departure from the usual sell-the-news pattern. Investors would likely weigh resilient profitability, high forecasted free cash flow of $600 million, and leadership changes against ongoing sales declines and lower adjusted EPS guidance.
Key Terms
operating income financial
net cash provided by operating activities financial
free cash flow financial
loss on extinguishment of debt financial
business transformation activities financial
forward-looking statements regulatory
AI-generated analysis. Not financial advice.
- Delivers Q1 net sales and adjusted earnings per share results above guidance
- First quarter net sales of
$1.4 billion , down3% . Earnings per diluted share of$0.90 ; Adjusted earnings per diluted share of$0.32 - Reaffirms full-year 2026 guidance of net sales down
4.5% to down2.5% , earnings per diluted share of$3.00 t o$3.25 ; and adjusted earnings per diluted share of$2.40 t o$2.65 - Chief Financial Officer Eva Boratto to step down June 12; Company appoints interim CFO with active search in progress
COLUMBUS, Ohio, May 27, 2026 (GLOBE NEWSWIRE) -- Bath & Body Works, Inc. (NYSE: BBWI) today reported first quarter 2026 results.
Daniel Heaf, chief executive officer of Bath & Body Works, commented, “Our first-quarter results exceeded guidance, but remain below the standard our brand is capable of delivering. That reality reinforces the urgency with which we are executing the Consumer First Formula. Our efforts to strengthen our hero categories, modernize the brand, and expand our reach are beginning to resonate with consumers, and we are encouraged by the early proof points we are seeing.”
“We believe that the foundation we are building will drive improved performance over time, with the impact expected to build through the balance of 2026 and more meaningfully into 2027, as we position the company to return to sustainable, durable growth.”
First Quarter 2026 Results
The company reported net sales of
Earnings per diluted share were
Reported first quarter 2026 results included an
At the conclusion of this press release is a reconciliation of reported‐to‐adjusted results, including a description of the adjusted items.
2026 Guidance
The company is maintaining its full-year 2026 guidance of net sales to decline between
For the second quarter of 2026, the company is forecasting net sales to decline between
At the conclusion of this press release is a reconciliation of our guidance-to-adjusted guidance, including a description of the adjusted items.
For a reconciliation of our reported GAAP to adjusted non-GAAP earnings per diluted share for fiscal 2025 and the second quarter of 2025, refer to our Annual Report on Form 10-K, filed with the SEC on March 12, 2026, and our Quarterly Report on Form 10-Q, filed with the SEC on August 28, 2025, respectively.
Chief Financial Officer Transition
Chief Financial Officer Eva Boratto will step down from her role effective June 12 to pursue another professional opportunity. The company has initiated a comprehensive search process, supported by a leading executive search firm, to identify its next Chief Financial Officer.
Tom Javitch has been appointed Interim Chief Financial Officer effective upon Boratto’s departure. Javitch has been with Bath & Body Works for more than 16 years and L Brands for 25 years. He has held a number of senior finance leadership roles across the organization, including Executive Vice President of Brand Finance of Bath & Body Works.
Daniel Heaf said, “We are grateful to Eva for her leadership and many contributions to Bath & Body Works during an important period for the company. We thank her for her partnership and wish her continued success in her next chapter. While we search for a successor, I’m confident in Tom Javitch’s interim leadership, deep understanding of Bath & Body Works and expertise across the business—from product to store operations to supply chain.”
Boratto said, “It has been a pleasure to serve on the leadership team at Bath & Body Works, and I would like to thank Daniel, my colleagues in the finance organization, the Board and all of our associates for the support during my time at this remarkable company. I leave with confidence in Daniel’s leadership and the strategy he has put in place, and I look forward to watching as Bath & Body Works continues to regain momentum in the marketplace.”
Earnings Call and Additional Information
Bath & Body Works, Inc. will conduct its first quarter earnings call at 8:30 a.m. ET on May 27th. 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 13760165 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 2025 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. First Quarter 2026 | ||||||||
| Total Sales (In millions): | ||||||||
| First Quarter | ||||||||
| 2026 | 2025 | % Change | ||||||
| Stores - U.S. and Canada (a) | $ | 1,062 | $ | 1,110 | (4.3 | %) | ||
| Direct - U.S. and Canada | 246 | 250 | (1.5 | %) | ||||
| International and Other (b) | 70 | 64 | 9.0 | % | ||||
| Total Bath & Body Works | $ | 1,378 | $ | 1,424 | (3.2 | %) | ||
| __________ | ||||||||
| (a) Results include fulfilled buy online pick up in store orders. | ||||||||
| (b) Results include royalties associated with franchised stores, as well as international and domestic wholesale sales. | ||||||||
Total Company-operated Stores:
| Stores | Stores | |||||||
| 1/31/2026 | Opened | Closed | 5/2/2026 | |||||
| United States | 1,814 | 13 | (17 | ) | 1,810 | |||
| Canada | 113 | — | — | 113 | ||||
| Total Bath & Body Works | 1,927 | 13 | (17 | ) | 1,923 | |||
Total Partner-operated Stores:
| Stores | Stores | |||||||
| 1/31/2026 | Opened | Closed | 5/2/2026 | |||||
| International | 536 | 8 | (2 | ) | 542 | |||
| International - Travel Retail | 37 | — | — | 37 | ||||
| Total International (a) | 573 | 8 | (2 | ) | 579 | |||
| __________ | ||||||||
| (a) Includes store locations only and does not include kiosks, shop-in-shops, gondola or beauty counter locations. | ||||||||
| BATH & BODY WORKS, INC. | |||||||
| CONSOLIDATED STATEMENTS OF INCOME | |||||||
| (Unaudited) | |||||||
| (In millions, except per share amounts) | |||||||
| First Quarter | |||||||
| 2026 | 2025 | ||||||
| Net Sales | $ | 1,378 | $ | 1,424 | |||
| Costs of Goods Sold, Buying and Occupancy | (791 | ) | (778 | ) | |||
| Gross Profit | 587 | 646 | |||||
| General, Administrative and Store Operating Expenses | (356 | ) | (437 | ) | |||
| Operating Income | 231 | 209 | |||||
| Interest Expense | (69 | ) | (71 | ) | |||
| Other Income, Net | 4 | 8 | |||||
| Income Before Income Taxes | 166 | 146 | |||||
| Benefit (Provision) for Income Taxes | 17 | (41 | ) | ||||
| Net Income | $ | 183 | $ | 105 | |||
| Net Income per Diluted Share | $ | 0.90 | $ | 0.49 | |||
| Weighted Average Diluted Shares Outstanding | 202 | 215 | |||||
| BATH & BODY WORKS, INC. CONSOLIDATED CONDENSED BALANCE SHEETS (Unaudited) (In millions) | |||||||
| May 2, 2026 | May 3, 2025 | ||||||
| ASSETS | |||||||
| Current Assets: | |||||||
| Cash and Cash Equivalents | $ | 820 | $ | 636 | |||
| Accounts Receivable, Net | 98 | 103 | |||||
| Inventories | 782 | 869 | |||||
| Easton Assets Held for Sale | 81 | 97 | |||||
| Other | 118 | 115 | |||||
| Total Current Assets | 1,899 | 1,820 | |||||
| Property and Equipment, Net | 1,106 | 1,111 | |||||
| Operating Lease Assets | 974 | 970 | |||||
| Goodwill | 628 | 628 | |||||
| Trade Name | 165 | 165 | |||||
| Deferred Income Taxes | 110 | 133 | |||||
| Other Assets | 81 | 54 | |||||
| Total Assets | $ | 4,963 | $ | 4,881 | |||
| LIABILITIES AND EQUITY (DEFICIT) | |||||||
| Current Liabilities: | |||||||
| Accounts Payable | $ | 557 | $ | 452 | |||
| Accrued Expenses and Other | 513 | 495 | |||||
| Current Operating Lease Liabilities | 206 | 201 | |||||
| Income Taxes | 101 | 146 | |||||
| Total Current Liabilities | 1,377 | 1,294 | |||||
| Deferred Income Taxes | 115 | 23 | |||||
| Long-term Debt | 3,613 | 3,886 | |||||
| Long-term Operating Lease Liabilities | 894 | 895 | |||||
| Other Long-term Liabilities | 95 | 233 | |||||
| Total Equity (Deficit) | (1,131 | ) | (1,450 | ) | |||
| Total Liabilities and Equity (Deficit) | $ | 4,963 | $ | 4,881 | |||
| BATH & BODY WORKS, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) (In millions) | |||||||
| First Quarter | |||||||
| 2026 | 2025 | ||||||
| Operating Activities: | |||||||
| Net Income | $ | 183 | $ | 105 | |||
| Adjustments to Reconcile Net Income to Net Cash Provided by Operating Activities: | |||||||
| Depreciation of Long-lived Assets | 61 | 64 | |||||
| Share-based Compensation Expense | 8 | 10 | |||||
| Gain on Sale of Non-core Asset | (3 | ) | — | ||||
| Loss on Extinguishment of Debt | 8 | — | |||||
| Tax Benefit from Resolution of Certain Tax Matters | (62 | ) | — | ||||
| Changes in Assets and Liabilities: | |||||||
| Accounts Receivable | 82 | 103 | |||||
| Inventories | (83 | ) | (134 | ) | |||
| Accounts Payable, Accrued Expenses and Other | 34 | 14 | |||||
| Income Taxes Payable | 29 | 34 | |||||
| Other Assets and Liabilities | (13 | ) | (8 | ) | |||
| Net Cash Provided by (Used for) Operating Activities | 244 | 188 | |||||
| Investing Activities: | |||||||
| Capital Expenditures | (49 | ) | (37 | ) | |||
| Proceeds from Sale of Non-core Asset | 8 | — | |||||
| Other Investing Activities | (1 | ) | (2 | ) | |||
| Net Cash Used for Investing Activities | (42 | ) | (39 | ) | |||
| Financing Activities: | |||||||
| Payments for Long-term Debt | (289 | ) | — | ||||
| Repurchases of Common Stock | — | (136 | ) | ||||
| Dividends Paid | (40 | ) | (43 | ) | |||
| Tax Payments related to Share-based Awards | (3 | ) | (4 | ) | |||
| Other Financing Activities | (3 | ) | (5 | ) | |||
| Net Cash Used for Financing Activities | (335 | ) | (188 | ) | |||
| Effects of Exchange Rate Changes on Cash and Cash Equivalents | — | 1 | |||||
| Net Decrease in Cash and Cash Equivalents | (133 | ) | (38 | ) | |||
| Cash and Cash Equivalents, Beginning of Year | 953 | 674 | |||||
| Cash and Cash Equivalents, End of Period | $ | 820 | $ | 636 | |||
| BATH & BODY WORKS, INC. | ||||||
| ADJUSTED FINANCIAL INFORMATION | ||||||
| (Unaudited) | ||||||
| (Dollars in millions, except per share amounts) | ||||||
| First Quarter | ||||||
| 2026 | 2025 | |||||
| Reconciliation of Reported Operating Income to Adjusted Operating Income | ||||||
| Reported Operating Income | $ | 231 | $ | 209 | ||
| Interchange Fee Settlements | (88 | ) | — | |||
| Business Transformation Activities | 8 | — | ||||
| Adjusted Operating Income | $ | 151 | $ | 209 | ||
| Reconciliation of Reported Net Income to Adjusted Net Income | ||||||
| Reported Net Income | $ | 183 | $ | 105 | ||
| Interchange Fee Settlements | (88 | ) | — | |||
| Business Transformation Activities | 8 | — | ||||
| Loss on Extinguishment of Debt | 8 | — | ||||
| Gain on Sale of Non-core Asset | (3 | ) | — | |||
| Tax Effect of Adjustments | 19 | — | ||||
| Tax Benefit from Resolution of Certain Tax Matters | (62 | ) | — | |||
| Adjusted Net Income | $ | 65 | $ | 105 | ||
| Reconciliation of Reported Net Income per Diluted Share to Adjusted Net Income per Diluted Share | ||||||
| Reported Net Income per Diluted Share | $ | 0.90 | $ | 0.49 | ||
| Interchange Fee Settlements | (0.43 | ) | — | |||
| Business Transformation Activities | 0.04 | — | ||||
| Loss on Extinguishment of Debt | 0.04 | — | ||||
| Gain on Sale of Non-core Asset | (0.02 | ) | — | |||
| Tax Effect of Adjustments | 0.09 | — | ||||
| Tax Benefit from Resolution of Certain Tax Matters | (0.31 | ) | — | |||
| Adjusted Net Income per Diluted Share | $ | 0.32 | $ | 0.49 | ||
See Notes to Adjusted Financial Information.
| BATH & BODY WORKS, INC. | |||||||
| FORECASTED ADJUSTED FINANCIAL INFORMATION | |||||||
| (Unaudited) | |||||||
| (In millions, except per share amounts) | |||||||
| Full-Year | |||||||
| 2026 | |||||||
| Reconciliation of Forecasted Net Income Per Diluted Share to Forecasted Adjusted Net Income per Diluted Share | |||||||
| Low | High | ||||||
| Forecasted Net Income per Diluted Share | $ | 3.00 | $ | 3.25 | |||
| Interchange Fee Settlements | (0.43 | ) | (0.43 | ) | |||
| Business Transformation Activities | 0.04 | 0.04 | |||||
| Loss on Extinguishment of Debt | 0.04 | 0.04 | |||||
| Gain on Sale of Non-core Asset | (0.02 | ) | (0.02 | ) | |||
| Tax Effect of Adjustments | 0.09 | 0.09 | |||||
| Tax Benefit from Resolution of Certain Tax Matters | (0.31 | ) | (0.31 | ) | |||
| Forecasted Adjusted Net Income Per Diluted Share | $ | 2.40 | $ | 2.65 | |||
| Full-Year | |||||||
| Reconciliation of Forecasted Net Cash Provided by Operating Activities to Forecasted Free Cash Flow | 2026 | ||||||
| Forecasted Net Cash Provided by Operating Activities | $ | 870 | |||||
| Forecasted Capital Expenditures | (270 | ) | |||||
| Forecasted Free Cash Flow | $ | 600 | |||||
See Notes to Adjusted Financial Information.
BATH & BODY WORKS, INC.
NOTES TO ADJUSTED FINANCIAL INFORMATION
(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 2026
In the first quarter of 2026, adjusted results exclude the following:
- An
$88 million pre-tax gain ($66 million after tax), included as a reduction to General, Administrative and Store Operating Expenses, related to cash proceeds received, net of legal fees, for favorable settlements of payment card interchange fee litigation; - Aggregate pre-tax costs of
$8 million ($6 million after tax), primarily included in General, Administrative and Store Operating Expenses, resulting from business transformation activities in connection with the Consumer First Formula; - An
$8 million pre-tax loss ($6 million after tax), included in Other Income, Net, related to the repurchase and early extinguishment of outstanding debt; - A
$3 million pre-tax gain ($3 million after tax), included in Other Income, Net, related to the sale of a non-core asset; and - A
$62 million tax benefit associated with the resolution of certain tax matters.
Full-year 2026 Forecasted Adjusted Net Income per Diluted Share excludes the adjustments referenced above.
Fiscal 2025
There were no adjustments to results in the first quarter of 2025.
Forecasted Free Cash Flow
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.
