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Bath & Body Works, Inc. (NYSE: BBWI) delivered a robust performance in the third quarter of 2024, surpassing both its own guidance and market expectations. The company reported net sales of $1.61 billion, marking a 3% increase compared to the same period last year.

Earnings per diluted share came in at $0.49, slightly down from $0.52 in the previous year but still exceeding the adjusted EPS of $0.48 from last year after accounting for a $12 million pre-tax gain from debt extinguishment. Operating income was $218 million, a minor decrease from $221 million in the prior year, while net income stood at $106 million, down from $119 million.

CEO Gina Boswell attributed the company’s success to its strategic focus on innovation and the effective execution of its agile business model. She highlighted the positive impact of investments in marketing and technology, which have resonated with both new and existing customers.

Boswell emphasized the company’s strong positioning to navigate the volatile retail environment, especially as it heads into the critical holiday season. The company’s predominantly U.S.-based supply chain has been a key factor in maintaining operational efficiency and supporting sustainable growth.
 

Outperformance Against Expectations in Third Quarter for BBWI

Analysts had anticipated an EPS of $0.4695 and revenue of $1.58 billion for the quarter. The actual EPS of $0.49 and revenue of $1.61 billion showed that the firm outperformed in a challenging retail landscape.

Despite a slight decline in net income compared to the previous year, the company’s adjusted earnings per share of $0.49 indicate a stable underlying business performance. The company’s U.S. and Canada store sales grew by 4.4%, contributing significantly to the overall sales increase.

However, international sales saw a decline of 11.1%, highlighting potential areas for improvement in global markets. The direct-to-consumer segment also showed a modest growth of 1.5%, further supporting the company’s strong performance.
 

Bath & Body Works Revises Full-Year Guidance Upwards

Following its strong third-quarter performance, Bath & Body Works has revised its full-year guidance upwards. The company now expects fiscal 2024 net sales to decline by 1.7% to 2.5%, a slight improvement from previous guidance.

The adjusted earnings per diluted share for the full year are projected to be between $3.15 and $3.28, compared to $3.27 in fiscal 2023. The company anticipates a headwind of approximately 100 basis points due to the absence of an extra week in the fiscal year compared to 2023.

For the fourth quarter, Bath & Body Works expects net sales to decline by 4.5% to 6.5%, with earnings per diluted share projected between $1.94 and $2.07. This outlook factors in a significant calendar shift, which is expected to impact sales by 500 basis points.

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