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Americas Retail Revenue

Americas Wholesale Revenue

Licensing Revenue

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Product sales (USD, thousands)

Net royalties (USD, thousands)

Net revenue (USD, thousands)

Cost of product sales (USD, thousands)

Gross profit (USD, thousands)

Selling, general and administrative expenses (USD, thousands)

Asset impairment charges (USD, thousands)

Net (gains) losses on lease modifications (USD, thousands)

Gain on sale of assets (USD, thousands)

(Gain) loss on equity method investment (USD, thousands)

Earnings from operations (USD, thousands)

Interest expense (USD, thousands)

Interest income (USD, thousands)

Loss on extinguishment of debt (USD, thousands)

Other expense, net (USD, thousands)

Earnings (loss) before income tax expense (benefit) (USD, thousands)

Income tax expense (benefit) (USD, thousands)

Net earnings (loss) (USD, thousands)

Net earnings attributable to noncontrolling interests (USD, thousands)

Net earnings (loss) attributable to Guess?, Inc. (USD, thousands)

Net earnings (loss) per common share attributable to common stockholders: Basic (USD)

Net earnings (loss) per common share attributable to common stockholders: Diluted (USD)

Weighted average common shares outstanding attributable to common stockholders: Basic

Weighted average common shares outstanding attributable to common stockholders: Diluted

8305982f4e9be7b0a6037d985b5e61561dae1706ce3bbef760e02168a48f8d41

Net cash provided by (used in) operating activities (USD, thousands)

Net cash used in investing activities (USD, thousands)

Net cash used in financing activities (USD, thousands)

Effect of exchange rates on cash, cash equivalents and restricted cash (USD, thousands)

Net change in cash, cash equivalents and restricted cash (USD, thousands)

Depreciation and amortization (USD, thousands)

Purchases of property and equipment (USD, thousands)

Repayments on borrowings and finance lease obligations (USD, thousands)

Cash, cash equivalents and restricted cash at the beginning of the year (USD, thousands)

Cash, cash equivalents and restricted cash at the end of the period (USD, thousands)

1129e693e4b2dc8ab81b61131a0ab35bf7ed0bc8bb2b2c7abbd5e090642d7264

In **Q1 2023**, the operating cash flow was low due to a combination of factors that increased cash outflows. The company reported a net cash use of **(54,570) thousand USD**. This was primarily driven by a **substantial increase in inventories to 37,698 thousand USD** (versus 9,574 thousand USD in the previous Q1), a significant decrease in **accounts payable and accrued expenses by 59,351 thousand USD**, a larger negative impact from **operating lease assets and liabilities with a decrease of 16,434 thousand USD**, and an increase in **accounts receivable by 20,317 thousand USD**. These working capital changes collectively contributed to the lower operating cash flow in Q1 2023.  **[0000912463-22-000098_ges-20220430.htm:4]** **[GES_361570_6]** **[GES_361570_2]** 

Why was Operating Cash Flow so low in Q1 2023?

The spike in capital expenditures in Q1 2023 was driven by **substantial investments in remodels, new stores, and technology**.  **[0000912463-22-000098_ges-20220430.htm:4]** **[GES_361570_6]** 

What drove the spike in capital expenditures in Q1 2023?

The significant increase in proceeds from borrowings in Q1 2023 is likely attributable to the finalization of a **€250 million revolving credit facility in Europe**, which replaced several short-term borrowing arrangements and increased the region's borrowing capacity. Additionally, the facility included an option for a **€100 million expansion** and a two-year extension under certain conditions, which may have further contributed to the marked change in borrowing levels.  **[GES_361570_6]** **[GES_361570_3]** 

What led to the significant increase in proceeds from borrowings in Q1 2023?

The significant negative net change in cash in Q1 2023 was primarily driven by large cash outflows across several activities. **Financing activities** consumed about **$(176,794) thousand** mainly due to spending on an equity forward contract, treasury stock repurchases, and higher dividend payments. **Investing activities** contributed further with a notable increase in capital expenditures—about **$28.7 million**—primarily for remodels, new stores, and technology investments. Additionally, **operating activities** used slightly more cash due to changes in working capital and there was an unfavorable impact from **exchange rates** amounting to about **$(7,108) thousand**. These factors collectively led to the dramatic negative shift in cash for Q1 2023.  **[0000912463-22-000084_a991erq1fy23narrative.htm:13]** **[0000912463-22-000098_ges-20220430.htm:4]** 

Why did the net change in cash turn so negative in Q1 2023?

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Operating earnings turned negative in Q1 2025 because the company faced **increased expenses** (including a **44%** rise in corporate overhead and higher costs related to marketing, infrastructure, and the integration of the **rag & bone acquisition**, which added **$11 million** in charges), **unfavorable currency impacts**—particularly in Europe where these factors reduced operating margins—and significant **segment-specific challenges**. For example, Americas Retail experienced a notable decline in its operating margin due to negative retail comparable sales, and other regions also faced pressure, contributing to an overall operating loss of **$19.9 million** in Q1 2025.  **[0000912463-24-000040_a991erq1fy25narrative.htm:11]** **[0000912463-24-000051_ges-20240504.htm:71]** **[GES_3391184_6]** **[0000912463-24-000040_a991erq1fy25narrative.htm:2]** 

Why did operating earnings turn negative in Q1 2025?

The Q3 2025 net earnings turned negative primarily due to several factors. First, a **net unrealized loss of $39.8 million on derivatives** significantly increased other expenses, marking a considerable change from the previous year.  **[0000912463-24-000081_a991erq3fy25narrative.htm:1]** **[0000912463-24-000081_a991erq3fy25narrative.htm:2]** **[0000912463-24-000096_ges-20241102.htm:76]**  Additionally, **SG&A expenses increased by $45.3 million (19.3%)**—largely driven by higher advertising spends, store labor costs, and costs linked to the recent rag & bone acquisition.  **[0000912463-24-000096_ges-20241102.htm:76]** **[0000912463-24-000096_ges-20241102.htm:79]**  The shift in tax impact further contributed, as the company recorded an **income tax expense of $11.7 million** in Q3 2025 compared to an **income tax benefit of $18.3 million** in Q3 2024.  **[0000912463-24-000096_ges-20241102.htm:76]** **[0000912463-24-000096_ges-20241102.htm:3]**  Finally, weakening operating conditions — a drop in the **operating margin from 8.4% to 5.7%**, a **decline in gross margin by 1.1 percentage points**, and **negative retail comparable sales** in key regions — compounded the negative earnings outcome.  **[0000912463-24-000081_a991erq3fy25narrative.htm:1]** **[0000912463-24-000096_ges-20241102.htm:79]** 

What factors contributed to the net earnings turning negative in Q3 2025?

Basic EPS turned negative in Q3 2025 due to several key factors. **First**, a **$39.8 million net unrealized loss on derivatives**—stemming from the fair value remeasurement related to the convertible senior notes and the corresponding hedge—had a major impact on earnings.  **[0000912463-24-000081_a991erq3fy25narrative.htm:1]** **[0000912463-24-000081_a991erq3fy25narrative.htm:2]**  **Second**, **SG&A expenses increased by 20% to $279 million**, which put additional pressure on profitability.  **[GES_3410142_7]**  **Third**, a **110 basis point deterioration in gross margin to 43.6%**—driven by an unfavorable channel mix and occupancy deleverage—further eroded margins.  **[GES_3410142_7]**  **Additionally**, a stronger U.S. dollar negatively affected revenue and operating profit (reducing operating profit by approximately **$3 million**) and the adjusted effective tax rate of **36.6%** also contributed to the decline.  **[GES_3410142_7]**  Together, these factors drove the EPS into negative territory in Q3 2025.

What drove basic EPS to turn negative in Q3 2025?

The reversal to a positive income tax expense in **Q3 2025** is primarily explained by two key factors. First, the company recorded a **$40 million unrealized loss on derivatives** related to the 2028 Notes and the related convertible note hedge, which was **disregarded for tax purposes**. This exclusion significantly impacted the effective tax rate, resulting in a **negative 128.9% effective income tax rate** for that quarter. Second, the contrast with **Q3 2024**—when a **discrete income tax benefit** was recognized due to the consolidation of certain business functions into Switzerland—meant that the benefit reducing the prior-year tax expense was absent in Q3 2025. These elements combined to reverse the expense from a negative to a positive value in Q3 2025.  **[0000912463-24-000096_ges-20241102.htm:78]** 

Why did the income tax expense reverse to a positive value in Q3 2025?

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Guess? Inc (GES)

Financials