G-III Apparel 2026 Q3 Earnings EPS Declines 27.1% Amid Revenue Drop

G-III Apparel (GIII) reported fiscal 2026 Q3 earnings on Dec 9, 2025, with revenue declining 9.0% year-over-year to $988.65 million. The company raised fiscal 2026 guidance to $2.98 billion in revenue and non-GAAP EPS of $2.80–$2.90, reflecting Q3 outperformance and tariff pressures.

Revenue

G-III Apparel’s total revenue for Q3 2026 fell to $988.65 million, a 9.0% decline from $1.09 billion in the prior year. Wholesale operations led with $977.31 million, while the retail segment contributed $45.67 million. Eliminations reduced the total by $34.33 million, reflecting intersegment adjustments. The revenue shortfall was attributed to macroeconomic challenges and tariff impacts, though the company highlighted strength in owned brands and full-price sales.

Earnings/Net Income

Earnings per share (EPS) dropped 27.1% to $1.91 in Q3 2026, compared to $2.62 in the prior year. Net income also fell sharply, declining 29.8% to $80.59 million from $114.77 million. The decline was driven by gross margin contraction and higher operating expenses, despite cost mitigation efforts. This marked a significant underperformance relative to the company’s historical profitability.

Post-Earnings Price Action Review

The strategy of buying GIII when earnings beat and holding for 30 days delivered moderate performance but underperformed the benchmark. The strategy achieved a 53.41% return, trailing the benchmark by 34.88%. With a maximum drawdown of 0.00% and a Sharpe ratio of 0.18, the strategy indicated a low-risk profile but lacked significant growth potential.

CEO Commentary

Morris Goldfarb, Chairman and CEO, emphasized Q3 profitability exceeding guidance despite tariff challenges, driven by owned brands’ strength and full-price sales. He highlighted replacing 70% of PVH licensing losses through organic growth, with Donna Karan and Karl Lagerfeld leading with pricing power and category expansion. Goldfarb expressed confidence in G-III’s agility, strong balance sheet ($174M net cash), and long-term growth through owned brands, strategic partnerships, and disciplined inventory management.

Guidance

G-III raised fiscal 2026 guidance to $2.98B revenue and non-GAAP EPS of $2.80–$2.90, reflecting Q3 outperformance and tariff pressures. The company expects $135M total tariff impact (unmitigated: $65M), 200 bps gross margin contraction, and $40M CAPEX for brand expansions and tech. Adjusted EBITDA is projected at $208–$213M, with a 29.5% tax rate and $1.5M interest expense. Neal Nackman, CFO, noted gross margins will normalize in 2027 as higher-margin owned brands expand and pricing adjustments offset costs. The Board also approved a $0.10/share dividend.

Additional News

G-III Apparel announced a $0.10/share quarterly dividend, marking its first dividend program. KeyBanc upgraded its price target to $33 from $30 while maintaining an Overweight rating. Additionally, the company raised fiscal 2026 guidance, citing strong Q3 performance and strategic focus on brand investments, DTC growth, and international expansion. These moves underscore confidence in G-III’s ability to navigate tariff pressures and deliver long-term value.