Guess? 2026 Q1 Earnings Call: Contradictions on Americas Retail Performance, Growth Strategies, and Margin Recovery

Americas Retail Business Performance and Initiatives, Future Growth and Revenue Expectations, Rag & Bone Brand Growth Strategy, Operating Margin Recovery and Long-term Expectations, Americas Retail Business Trajectory are the key contradictions discussed in Guess?'s latest 2026Q1 earnings call.



Revenue Growth and Strategic Acquisitions:
- Guess achieved a 9% increase in total company revenues to $648 million in U.S. dollars for Q1 fiscal 2026, reflecting a 12% increase in constant currency.
- This growth was primarily driven by the acquisition of rag & bone, which added 9 percentage points to top-line growth, and strong wholesale businesses in Europe and the Americas.

Operating Profitability Improvement:
- The company reported an adjusted operating loss of $26 million for the quarter, resulting in an adjusted operating margin of 4%, a significant improvement over expectations.
- This improvement was due to disciplined expense management and better-than-expected top-line performance, despite a currency headwind.

Regional Performance Variability:
- Guess's European wholesale business showed mid-teen growth, driven by strong product performance and reliable shipping, while Asia experienced a 20% revenue decline due to challenging market conditions and internal strategic adjustments.
- In the Americas, retail sales exceeded expectations, with a 10% constant currency comp sales decline, while wholesale grew by 63% in U.S. dollars.

Tariff Impact and Business Optimization:
- Despite tariffs, Guess expected the year-over-year impact on margins to be less than $10 million, mainly through supply chain shifts and cost rework.
- Strategic initiatives include reducing non-strategic store fleets, optimizing business models, and restructuring global infrastructure to enhance operational efficiency.