By Prerna Bedi (Reuters) -Bath & Body Works forecast a surprise sales decline for the crucial holiday quarter on Thursday, signalling weak appetite for scented candles and fragrances among cash-strapped shoppers and sending its shares down nearly 24%. The retailer, whose shares have lost 46% of their value so far this year, slashed its annual […]
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Bath & Body Works forecasts sales dip as holiday demand wanes; shares plunge
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By Prerna Bedi
(Reuters) -Bath & Body Works forecast a surprise sales decline for the crucial holiday quarter on Thursday, signalling weak appetite for scented candles and fragrances among cash-strapped shoppers and sending its shares down nearly 24%.
The retailer, whose shares have lost 46% of their value so far this year, slashed its annual sales and profit forecast and missed market estimates for the third quarter.
The Ohio-based company expects its fourth-quarter net sales to be down in high single digit from $2.79 billion it reported a year earlier, weighed down by cash-strapped consumers’ preference for cheaper alternatives over the retailer’s higher-priced products, as fluctuating tariff policies overcast the busy holiday season.
Analysts on average were expecting a 1.5% rise in sales, according to data compiled by LSEG.
Although insulated from direct impact of tariffs, thanks to its domestic sourcing, the firm has been pressured by mounting marketing and promotional costs to attract customers.
Bath & Body Works is aiming to rightsize its offerings, coupled with investing heavily to innovate and market itself in a bid to attract customers looking for deeper discounts before splurging on self care products, its executives said on a call with investors.
It launched a transformation plan on Thursday under which it will deliver $250 million in cost savings over the next two years, with over half of them in 2026.
“With …. a surprisingly weak Q4 outlook, the recovery appears to be entering a more prolonged phase than originally anticipated,” Telsey Advisory Group analyst Dana Telsey said in a note.
It now expects 2025 net sales to decline by low single digit, compared with its prior forecast of growth between 1.5% and 2.7%. It slashed its fiscal 2025 earnings per share forecast to at least $2.87, from previous range of $3.35 to $3.60.
Bath & Body Works posted an adjusted profit of 35 cents per share for the quarter ended November 1, missing market expectations of 39 cents.
Its quarterly sales fell 1% to $1.59 billion from a year ago, trailing estimates of $1.63 billion.
(Reporting by Prerna Bedi in Bengaluru; Editing by Maju Samuel)