BUCKLE INC (BKE)·Q1 2026 Earnings Summary

Executive Summary

• Q1 2026 delivered modest topline and EPS beats versus consensus: revenue $272.1M vs $268.1M est. (+1.5%) and diluted EPS $0.70 vs $0.693 est. (+1%) driven by merchandise margin strength and slight occupancy leverage . Gross margin expanded 70 bps YoY to 46.7%, while operating margin was 16.0% (down 20 bps YoY) as SG&A rose to 30.7% of sales .
• Comparable store sales increased 3.0% and online sales grew 4.5% to $46.4M; women’s merchandise sales rose ~10.5% with women’s denim +11%, offset by men’s merchandise (-2.5%) and persistent weakness in footwear (-7%) .
• Inventory remained well-balanced at $132.4M (+1.3% YoY), with $320M total cash and investments; capex was $11.4M in Q1 as Buckle completed five remodels and plans seven new stores and 16 additional full remodels in the remainder of the year .
• Catalyst: continued private-label penetration (47.5%) and strong regular-price sell-through in women’s categories support margins; tariff risk managed via vendor sourcing diversification and cost controls, but SG&A inflation remains a watch item for estimate revisions .

What Went Well and What Went Wrong

What Went Well

• Merchandise margins +60 bps YoY; gross margin 46.7% (+70 bps YoY) supported by increased private label mix and strong regular-price sell-through; slight occupancy leverage (+10 bps) aided results .
• Women’s momentum: merchandise sales +~10.5% YoY with women’s denim +~11% and AUR increases; women’s now ~50% of sales (vs 47% prior year) .
• Healthy balance sheet and reinvestment: $320M total cash/investments; $11.4M Q1 capex with five full remodels, planning seven new stores and 16 additional full remodels for the rest of the year .

What Went Wrong

• SG&A deleverage: SG&A at 30.7% of sales (vs 29.8% prior year) on higher incentive comp accruals (+45 bps), health insurance costs (+25 bps), equity comp (+20 bps) and other items (+40 bps), partly offset by lower e-commerce shipping (-25 bps) and marketing (-15 bps) .
• Men’s softness and category mix headwinds: men’s merchandise -~2.5% YoY; footwear -~7% and ~5.5% of sales, continuing a multi-quarter drag despite modest accessories growth (+~3.5%) .
• Operating margin dipped to 16.0% (vs 16.2% prior year) despite gross margin gains, reflecting SG&A pressures and only slight occupancy leverage .

Financial Results

Segment/Mix

KPIs and Operating Metrics

Guidance Changes

Earnings Call Themes & Trends

Management Commentary

• “Gross margin for the quarter was 46.7%, a 70 basis point increase… the result of a 60 basis point increase in merchandise margins along with 10 basis points of leverage in buying, distribution and occupancy expenses.”
• “We continued to see nice growth in our private brands across nearly every category… private label represented 47.5% of sales versus 46% in the first quarter of 2024.”
• “Women’s business continued its strong momentum… women’s denim increased approximately 11%… driven by growth in Buckle Black Label and higher price-point national brands.”
• “Tariffs: we have vendors… with no increases, others with low to mid-single-digit increases; we’re managing tariffs and product has worked out well.”
• “Operating margin for the quarter was 16% compared to 16.2% for the first quarter of fiscal 2024… SG&A increase due to incentive compensation, health insurance, equity comp, and other items.”

Q&A Highlights

• Tariffs and sourcing: Management noted vendor cost increases are generally low to mid-single-digits and vendors are sourcing across countries; strong vendor relationships help manage pricing and quality .
• Merchandise margin drivers: Growth in private label and strong regular-price selling were primary drivers of the 60 bps merchandise margin expansion; footwear mix decline is margin-accretive .
• Occupancy leverage: Total occupancy costs up ~3.5%; with sales growth, delivered ~10 bps leverage in Q1 .
• SG&A outlook: SG&A dollars +$5M YoY; store payroll was the largest driver (+$2M) with variable labor tied to topline, plus higher incentive comp, equity comp, and health insurance costs .
• Balance sheet: Increase in operating lease right-of-use assets driven by new stores and remodels; inventory up 1.3% YoY and cash/investments ~$320M .

Estimates Context

• Results vs Wall Street consensus (S&P Global): BKE modestly beat revenue and EPS.
  • Revenue: Actual $272.1M vs Consensus $268.1M* .
  • EPS (diluted): Actual $0.70 vs Consensus $0.693* .
  • Number of estimates: EPS 2*, Revenue 2*.

Values retrieved from S&P Global.*

Implications: Modest beats likely reflect stronger women’s performance and private-label mix; SG&A inflation partially offsets, suggesting limited upward estimate revisions to margins unless cost pressures ease .

Key Takeaways for Investors

• Private-label and women’s category strength continue to underpin merchandise margins and gross margin expansion; sustainment of these trends is key to the near-term bull case .
• SG&A inflation (labor, incentive comp, health insurance, equity comp) is compressing operating margin despite gross margin gains; monitor expense discipline and leverage as comps improve .
• Footwear remains a drag and mix headwind; continued weakness caps margin upside even as accessories modestly grow .
• Tariff risk is being actively managed with vendor diversification and strong relationships; near-term impact appears contained to low/mid-single-digit cost changes .
• Healthy cash/investment position ($320M) and ongoing store remodels/openings provide optionality for reinvestment and shareholder returns (quarterly $0.35 dividend) .
• Near-term trading setup: modest beat with improving gross margins and strong women’s categories vs SG&A headwinds; watch monthly sales cadence and any tariff/expense commentary for directional cues .
• Medium-term thesis: execution on digital improvements, continued mix shift to private label, and relocations to outdoor centers should support margins; category breadth and inventory balance reduce downside risk in a choppy consumer backdrop .