Guess', Inc.

Total revenue increased 9% year over year in U.S. dollars to $648 million, and 12% in constant currency. Total company gross margin was 39.9%, down 200 basis points from last year. Adjusted operating loss was $26 million, adjusted operating loss margin was 4%, and adjusted diluted loss per share was $0.44 versus $0.27 a year ago. For Q2, management expects U.S. dollar revenue growth of 2.9% to 4.7%, adjusted operating margin of 2.5% to 3.3%, and adjusted EPS of $0.11 to $0.21. For the full year, guidance is revenue growth of 5.5% to 7.4%, adjusted operating margin of 4.4% to 5.1%, adjusted EPS of $1.32 to $1.64, and free cash flow of roughly $55 million including $65 million of capex.

Carlos Alberini said the quarter beat expectations across key metrics and reflected successful rag & bone integration plus better-than-expected wholesale momentum in Europe and the Americas. He framed retail productivity, marketing, pricing, and assortment changes as the company’s highest-priority levers, and said early reads in North America and Europe were encouraging, with sequential improvements in conversion and retail comps in Q2. His tone was constructive and execution-focused, but he also acknowledged continued traffic weakness, Asia challenges, and the need to simplify the business.

Dennis Secor quantified the quarter and the balance sheet: revenue of $648 million, gross margin of 39.9%, SG&A of $285 million, adjusted operating loss of $26 million, and adjusted diluted loss per share of $0.44. He noted inventory of $638 million, up 15% in dollars, receivables of $331 million, cash of $151 million, and about $0.5 billion of available liquidity, with free cash flow for the year expected to be roughly $55 million including $65 million of capex. He also said the tariff impact on margins should be less than $10 million this year and is already embedded in guidance.

Analysts focused on rag & bone organic growth, the trajectory of Americas retail, inventory levels, Guess Jeans, and whether margins could stabilize or improve in the second half. Management said rag & bone is exceeding expectations, with strong wholesale and direct-to-consumer performance, plans for more stores and new categories, and a target above $320 million in business this year. On Americas retail, they said traffic remains weak but conversion, AUR, product mix, and pricing changes are improving results; on inventory, they said the increase is intentional to offset supply-chain risk and should unwind over time.