Bath & Body Works (BBWI) BBWI Q2 Financial Results Summary
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Bath & Body Works, Inc. (BBWI) Q2 2026: Earnings Beat Guidance, Sales Decline — Cautiously Optimistic
Bath & Body Works, Inc. (NYSE: BBWI) reported its second quarter results for 2026, revealing a mixed performance that exceeded earnings expectations but showed a decline in net sales compared to the previous year.
Key Findings:
- Net Sales: $1.514 billion, down $35 million or -2.3% from $1.549 billion in Q2 2025.
- Earnings Per Share (EPS): Reported at $0.58, up +93% from $0.30 in Q2 2025. Adjusted EPS was $0.62.
- Operating Income: Increased to $216 million from $157 million, a rise of +37.6%.
- Net Income: Rose to $118 million compared to $64 million last year, marking an 84.4% increase.
Analyst View:
This quarter can be viewed as a cautiously optimistic outcome for shareholders. While the decline in net sales is concerning, the significant increase in earnings per share and operating income indicates that the company is effectively managing costs and improving profitability. The reported EPS of $0.58 and adjusted EPS of $0.62 both surpassed market expectations, reflecting the company's ability to navigate challenging market conditions.
Detailed Metrics:
- Net Sales:
- Q2 2026: $1,514 million
- Q2 2025: $1,549 million
- Change: -2.3%
- Earnings Per Diluted Share:
- Q2 2026: $0.58
- Q2 2025: $0.30
- Change: +93%
- Adjusted Earnings Per Diluted Share:
- Q2 2026: $0.62
- Q2 2025: $0.37
- Change: +67%
- Operating Income:
- Q2 2026: $216 million
- Q2 2025: $157 million
- Change: +37.6%
- Net Income:
- Q2 2026: $118 million
- Q2 2025: $64 million
- Change: +84.4%
Dividend and Guidance Changes:
Bath & Body Works has not announced any changes to its dividend policy, which remains a critical aspect for income-focused investors. However, the company has raised its full-year 2026 earnings per diluted share guidance to a range of $3.13 to $3.33, compared to $3.11 in fiscal 2025. The adjusted earnings per diluted share guidance has also been increased to $2.60 to $2.80, while net sales guidance has been narrowed to a decline between 4% to 2.5% compared to $7,291 million in fiscal 2025.
Forward Catalysts:
Investors should closely monitor the third quarter results, particularly the anticipated net sales decline forecasted between 5% to 2.5% compared to $1,594 million in Q3 2025. The company expects earnings per diluted share for Q3 2026 to be between $0.05 and $0.10, significantly lower than the $0.37 reported in Q3 2025. Additionally, the ongoing transformation strategy, dubbed the Consumer First Formula, will be crucial in determining the company's ability to regain sales momentum and improve customer engagement.
In summary, while Bath & Body Works faces challenges with declining sales, the substantial improvement in profitability metrics and raised guidance provide a foundation for cautious optimism among shareholders. The upcoming quarter will be pivotal in assessing the effectiveness of the company's strategic initiatives and overall market performance.
Note: All amounts in the following tables are in millions.
| Second Quarter 2026 | Second Quarter 2025 | Year-to-Date 2026 | Year-to-Date 2025 | |
|---|---|---|---|---|
| Net Sales | $1,514 | $1,549 | $2,892 | $2,974 |
| Costs of Goods Sold, Buying and Occup | -$822 | -$909 | -$1,613 | -$1,687 |
| Gross Profit | $692 | $640 | $1,279 | $1,287 |
| General, Admin... and Store Opera... | -$476 | -$483 | -$832 | -$920 |
| Operating Income | $216 | $157 | $447 | $367 |
| Interest Expense | -$63 | -$68 | -$132 | -$139 |
| Other Income | $11 | $6 | $15 | $13 |
| Net Income Before Income Taxes | $164 | $95 | $330 | $241 |
| Provision for Income Taxes | -$46 | -$31 | -$29 | -$72 |
| Net Income | $118 | $64 | $301 | $169 |
| Net Income per Diluted Share | $0.58 | $0.30 | $1.49 | $0.79 |
| Weighted-average Shares Outstanding | 202 | 211 | 202 | 213 |
| August 1, 2026 | August 2, 2025 | |
|---|---|---|
| ASSETS | ||
| Current Assets: | ||
| Cash and Cash Equivalents | $794 | $364 |
| Accounts Receivable, Net | $154 | $131 |
| Inventories | $883 | $977 |
| Easton Assets Held for Sale | $81 | $81 |
| Other | $138 | $153 |
| Total Current Assets | $2,050 | $1,706 |
| Property and Equipment, Net | $1,106 | $1,124 |
| Operating Lease Assets | $1,012 | $984 |
| Goodwill | $628 | $628 |
| Trade Name | $165 | $165 |
| Deferred Income Taxes | $108 | $133 |
| Other Assets | $87 | $74 |
| Total Assets | $5,156 | $4,814 |
| LIABILITIES AND EQUITY (DEFICIT) | ||
| Current Liabilities: | ||
| Accounts Payable | $676 | $567 |
| Accrued Expenses and Other | $556 | $541 |
| Current Debt | $248 | $— |
| Current Operating Lease Liabilities | $199 | $194 |
| Income Taxes | $28 | $1 |
| Total Current Liabilities | $1,707 | $1,303 |
| Deferred Income Taxes | $115 | $23 |
| Long-term Debt | $3,366 | $3,888 |
| Long-term Operating Lease Liabilities | $931 | $912 |
| Other Long-term Liabilities | $91 | $235 |
| Total Equity (Deficit) | -$1,054 | -$1,547 |
| Total Liabilities and Equity (Deficit) | $5,156 | $4,814 |
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