Bath & Body Works Posts Q2 Beat Amid Transformation Push
Event summary
- Q2 net sales of $1.5B, down 2.3% YoY, but exceeding guidance
- Adjusted EPS of $0.62, up from $0.37 in Q2 2025
- First direct net sales growth since 2021, driven by digital enhancements
- Raised full-year 2026 adjusted EPS guidance to $2.60-$2.80
- Expects net sales decline of 4%-2.5% for full-year 2026
The big picture
Bath & Body Works is navigating a challenging retail environment with its 'Consumer First Formula' strategy, focusing on digital enhancements and product innovation. The company's ability to deliver sequential improvements in key categories suggests early traction, but sustained growth will depend on maintaining momentum in its transformation efforts. With over 1,900 stores in the U.S. and Canada and a strong digital presence, the company is positioning itself for what it believes will be durable growth in 2027.
What we're watching
- Digital Momentum
- Whether the company can sustain direct sales growth through continued digital experience improvements
- Product Innovation
- How new product launches will impact average unit retail (AUR) and overall sales trajectory
- Marketplace Strategy
- The pace at which marketplace partnerships will contribute to revenue diversification
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