Joseph Civello

Joseph Civello sought more color on Oxford Industries' competitive positioning within the wholesale channel, particularly as the company moves past tariff-related inventory pressures. He also asked for an update on the planned price increases for the spring 2026 season.

Answer

Chairman and CEO Tom Chubb stated that Oxford Industries performed well relative to competitors in the wholesale channel during Q3 and expects this trend to continue in Q4, attributing any softness to general market caution rather than competitive positioning. CFO and COO Scott Grassmyer and Mr. Chubb confirmed that price increases ranging from 4% to 8% are planned for spring 2026, with approximately 4% specifically targeting the mitigation of the dollar impact from tariffs.

Joseph Civello asked about the potential magnitude of price increases for spring collections, how they would be implemented (broader range, brand/region-specific), and the performance of Lilly Pulitzer's direct-to-consumer business versus wholesale.

Answer

Tom Chubb, Chairman and CEO, stated that price increases would remain conservative as long as tariffs are uncertain, with spring increases slightly higher than fall/resort but not cumulative. Scott Grassmyer, CFO and COO, added that fall wholesale prices were already set, but spring will see increases in both direct-to-consumer and wholesale, aiming to make up gross margin dollars for spring. Tom Chubb noted that Lilly Pulitzer's specialty accounts tend to be cautious during tough times, leading to conservative purchasing, but performance in major accounts has been good, expressing no concerns about Oxford's position with key accounts.

Joseph Civello followed up on the price increases, asking about the potential magnitude for spring, whether they would be implemented on a broader range of products, and if they would be brand or region-specific. He also inquired about the performance of Lilly Pulitzer's Direct business versus its Wholesale channel.

Answer

Tom Chubb, Chairman and CEO, stated that Oxford Industries plans to be conservative with price increases while tariff uncertainty persists, noting that spring prices might be slightly higher than fall/resort. Scott Grassmyer, CFO and COO, added that wholesale price increases for fall were already set, but spring would see increases across both direct-to-consumer and wholesale channels, aiming to recover gross margin dollars. For Lilly Pulitzer, Mr. Chubb explained that specialty accounts tend to be cautious during tough times, leading to conservative purchasing, but he has no concerns about the brand's position with key accounts.

Joseph Vincent Civello followed up on price increases, asking about the potential magnitude and implementation strategy for spring, including product and brand specificity. He also inquired about the performance of Lilly Pulitzer's direct-to-consumer business compared to its wholesale channel.

Answer

Chairman and CEO Tom Chubb indicated that price increases would remain conservative while tariff uncertainty persists, with spring increases slightly higher than fall/resort. CFO and COO Scott Grassmyer added that fall wholesale prices were already set without increases, but spring would see increases across both direct-to-consumer and wholesale channels, aiming to recover gross margin dollars. Mr. Chubb clarified that price increases are year-over-year, not cumulative. For Lilly Pulitzer, Mr. Chubb noted that specialty accounts tend to be cautious in tough times, leading to conservative purchasing, while performance in major accounts has been good despite their conservative forward buys.

Joseph Civello from Truist Securities asked about the 4% growth in the wholesale channel, how this result compared to internal expectations, and the outlook for the second half of the year based on conversations with retail partners.

Answer

Chairman and CEO Tom Chubb stated the company was pleased with the wholesale growth, viewing it as a sign of brand strength in a competitive environment. CFO and COO Scott Grassmyer clarified that performance tracked to expectations, with a strong spring order book but a more conservative outlook for the year's second half, noting that specialty stores remain more challenged than department stores.

Joseph Civello from Truist Securities asked about the 4% growth in the wholesale channel, seeking context on how this performance compared to internal expectations and what conversations with retailers suggest for the second half of the year.

Answer

Chairman, CEO & President Tom Chubb stated that the company was pleased with the wholesale growth, viewing it as a sign of brand strength in a competitive department store environment. EVP, CFO & COO Scott Grassmyer confirmed that the results were in line with expectations, noting a solid spring order book but a more conservative outlook for the second half, particularly within the challenged specialty store channel.

Joseph Civello asked about the potential growth contribution from Nike and Jordan in fiscal 2026 compared to 2025, considering factors like a tougher brand-specific comp, a broader assortment, incremental doors, and the World Cup. He also inquired about the margin benefits observed from the inventory pulled forward prior to tariffs.

Answer

CEO Steve Lawrence stated that the combined Nike-Jordan brands have grown in the high single to low double digits, and he expects similar growth next year due to further Jordan rollout into more doors, continued access to more fashion Nike products, and the World Cup. Regarding inventory pulled forward, Steve clarified that the primary goal was not a huge margin benefit but rather to hold pricing at pre-accelerated tariff levels to protect sales and offer value to consumers during the holiday season. CFO Carl Ford echoed this, noting the 'sweaty knuckles' effort in the first half to pull forward inventory, which allowed them to offer lower costs and value to consumers, a strategy they have no regrets about.

Joseph Civello asked for more color on demand trends between Canvas and Athletic footwear at Journeys, specifically if the divergence was expanding and the innovation pipeline for both categories in fiscal 2026. He also inquired about the drivers of boot growth (innovation vs. access) and any insights into the income demographics of the consumer pullback.

Answer

Mimi Vaughn, Board Chair, President, and Chief Executive Officer, explained that fashion is broadening, with teens embracing more wearing occasions, and Journeys' unique positioning covers fashion, fashion athletic, and casual brands. She noted that athletic footwear is being worn more year-round, leading to greater growth in the athletic assortment compared to casual, while Canvas is less in demand. Vaughn indicated more innovation is expected on the athletic lifestyle side for fiscal 2026. For boots, she clarified that growth is very brand-specific, driven by iconic brands and a shift from taller boots to shorter, moccasin-type styles, rather than new innovations or better access. Regarding consumer demographics, Vaughn stated that while higher-income customers spend more robustly, the overall consumer is stretching to buy desired items at higher price points but conserving cash in between peak shopping periods, rather than trading down to lower-priced products.

Joseph Civello asked for an update on the performance and scaling of new and reintroduced brands at Journeys and questioned how improved product access might affect long-term ticket and transaction trends.

Answer

Mimi Vaughn, Chairman, President & CEO, stated that new brands are crucial for validating Journeys in emerging categories like lifestyle running and enhancing trend relevancy, noting they become revenue drivers over time. She highlighted that product elevation and a stronger athletic assortment are increasing average selling prices (ASPs), and unlike in past cycles, today's consumer is willing to pay higher prices for "must-have" items.

Joseph Civello of Truist Securities inquired about the drivers of Journeys' Q1 strength, asking about the impact of new athletic brand relationships and the current trends in the vulcanized footwear category.

Answer

CEO Mimi Vaughn explained that while new brands like HOKA and Saucony are important for validating Journeys' strategy, the Q1 comp was driven by existing brand strength. She confirmed that the vulcanized category remains pressured, but robust growth in athletic and casual footwear is more than offsetting this weakness.

Joseph Civello of Truist Securities inquired about how customer traffic at House of Sport and Fieldhouse stores compares to the chain average and the expected future dynamics between ticket and transactions. He also asked about the scaling of the DICK'S Media Network.

Answer

CFO Navdeep Gupta declined to provide specific traffic metrics but expressed strong enthusiasm for the overall performance and community engagement of the new store formats. President & CEO Lauren Hobart described the DICK'S Media Network as a long-term growth and margin driver, highlighting its unique access to live youth sports via GameChanger, but noted it is still in the 'early innings' and did not provide financial projections.