Vestis 2025 Q4 Earnings Widening Losses Amid 4.1% Revenue Growth

Vestis (VSTS) reported Q4 2025 earnings on Dec 1, 2025, with revenue rising 4.1% to $712.01 million but net losses widening 446.1% to $12.55 million. The stock surged 28.49% MTD but underperformed the S&P 500 in a 3-year annualized comparison.

Revenue

The total revenue of Vestis increased by 4.1% to $712.01 million in 2025 Q4, up from $684.28 million in 2024 Q4. This growth was driven by an additional week of operations, though underlying revenue declined 3.5% year-over-year when adjusted for the extra week.

Earnings/Net Income

Vestis's losses deepened to $0.10 per share in 2025 Q4 from a loss of $0.02 per share in 2024 Q4, reflecting a 400.0% wider loss. The company’s net loss widened to $-12.55 million, a 446.1% increase from the $-2.30 million loss in 2024 Q4. Despite these losses, Vestis has maintained profitability for three years over the corresponding fiscal quarter, indicating stable business performance. The EPS performance, however, signals deteriorating profitability.

Price Action

The stock price of Vestis has climbed 4.19% during the latest trading day, has jumped 10.53% during the most recent full trading week, and has surged 28.49% month-to-date.

Post Earnings Price Action Review

The strategy of buying Vestis (VSTS) shares on the date of its quarterly earnings release and holding for 30 days yielded moderate returns but underperformed the market. The 3-year annualized return was 4.3%, compared with the S&P 500's 8.6% return over the same period. While the strategy capitalized on the earnings release event, with a 6.75% return during the week following the earnings release, the stock subsequently experienced a decline, as evidenced by a -9.08% drop in after-hours trading following the release of Q4 results. The stock's volatility posed a risk to the strategy, as evidenced by significant fluctuations in price following the earnings release, compounded by broader market conditions and investor sentiment. The strategy's return was better than holding the stock outright, as the S&P 500 returned 8.6% over the same period, but underperformed compared to a buy-and-hold approach, which may have been more beneficial in the long term. In conclusion, while the strategy generated returns, they were modest and inconsistent with the broader market, with success hinging on the immediate post-earnings reaction marked by volatility. For a more stable return, investors may consider a longer-term perspective or robust risk management frameworks.

CEO Commentary

Jim Barber, President and CEO of Vestis, emphasized fiscal 2025’s strong finish as a foundation for fiscal 2026 strategic priorities. He outlined a transformation plan centered on Commercial Excellence (enhancing customer retention and profitability), Operational Excellence (standardizing processes and reducing costs), and Asset & Network Optimization (improving logistics). Barber noted initiatives under the plan would “progressively realize improvements in fiscal 2026,” reflecting an optimistic tone focused on unlocking operating leverage and durable financial performance. The plan aims to generate $75 million in annual operating cost savings by 2026 while enhancing revenue.

Guidance

Vestis provided fiscal 2026 guidance: revenue flat to down 2% compared to normalized 2025 revenue, Adjusted EBITDA of $285–315 million, and Free Cash Flow of $50–60 million. The strategic transformation plan is expected to cost $25–30 million and be substantially complete by 2027. The company anticipates cost savings of $75 million annually by 2026, with CFO Kelly Janzen emphasizing near-term focus on profitability and cash flow to strengthen long-term value creation.

Additional News

Vestis announced a multi-year strategic restructuring plan to enhance Commercial Excellence, Operational Excellence, and Asset & Network Optimization, aiming for $75 million in annual cost savings by 2026. CEO Jim Barber reiterated confidence in the company’s ability to strengthen performance and unlock operating leverage. The plan includes $15.4 million in Q4 2025 investments for market center facility improvements. CFO Kelly Janzen highlighted the importance of prioritizing profitability and cash flow to bolster long-term value creation.