Oct 29, 2026 earnings call — ACCELERATE progress, strong DTC and fleece momentum
Q3 net sales increased 2% to $963 million, driven by international growth and DTC strength.
Revenue $1.0B (est $0.9B) · EPS $1.66 (est $1.28)
Key quotes
"From a consumer standpoint, it's been just over 13 months since we launched our ACCELERATE Growth Strategy into the marketplace."
"We're particularly pleased with the momentum we saw in DTC e-commerce, which provides the pinnacle expression of our brands."
"Wholesale delivery timing was the primary driver of upside versus our Q3 revenue guidance, followed by stronger-than-expected U.S. DTC performance."
Analyst Q&A 8
U.S. direct-to-consumer trend
Q (Jonathan Komp · Baird): Will the improvement in U.S. D2C continue and what is driving it? Also, does the stronger Spring '27 order book reflect better D2C performance or other factors?
A: Management said e-commerce is part of the ACCELERATE program and the site and product presentation are much improved. They said improvements come from better traffic, better conversion, and a better consumer experience. They also said the Spring '27 order book has continued to strengthen, buoyed by ACCELERATE activations and marketing.
"So that's really how we're seeing the improvements in North American e-com." — Timothy Boyle (CEO·CHAIR)
SG&A and margin drivers for 2027
Q (Jim Swanson): Do you plan to use SG&A more aggressively to drive margin expansion in 2027, given refunds and inflation? Any other color on cost factors?
A: They said they are not providing forward guidance but would expect to leverage the SG&A line next year, dependent on full-year revenue growth. Management highlighted gross margin uncertainty while planning and noted product input cost pressures and the possibility of additional tariffs. They also said they are taking surgical price increases where possible.
Inventory delivered and order book stability
Q (Robert Drbul · BTIG): Has the in-transit inventory normalized and are there any material order cancellations or changes to the Fall '26 order book? Any weather risk for wholesale in Q4?
A: They said the in-transit inventory has primarily been delivered to distribution centers and is on its way to customers, so logistics issues are behind them. They said they receive orders and cancellations daily but have seen no meaningful change to the order book. They added they accelerated Spring '27 production for longer logistics lead times and see no unusual weather expectations for Q4.
"So Bob, as it relates to the in-transit inventory, that's primarily now been delivered to our various distribution centers and is on its way if it has not already been received by our customers." — Timothy Boyle (CEO·CHAIR)
Spring '27 orders and consumer growth
Q (Peter McGoldrick · Stifel): How is the Spring/Summer '27 order book trending by region and what is the split of growth from volume, price, and mix? Also, how is recruiting younger active consumers progressing?
A: They said the Spring '27 order book has strengthened and they now anticipate first-half wholesale growth in the mid-single-digit range, including low- to mid-single-digit growth in U.S. wholesale and stronger growth internationally. Management noted footwear growth was larger than apparel. They also said Engineered for Whatever is driving year-over-year improvements in consideration and purchase intent among target audiences and new customer growth in e-commerce.
"As it relates to the -- so first and foremost, I'd say we're awfully encouraged by where the Spring '27 order book has come in." — Jim Swanson (CFO)
Retail sell-through and Q3 beat drivers
Q (Mitchel Kummetz · Seaport): How are retail partners feeling about early winter sell-through and channel inventory? What drove the Q3 sales and EBIT beat and are there any timing shifts into Q1 '27?
A: They said merchandise delivered is selling through, especially the Amaze collection and improved fleece like the Helvetia, and that recent activations have changed retailer perceptions. Management said retailers entered the season with clean inventory positions. For Q3, the revenue beat was largely timing: management said a revenue beat in the $25 million range with about $20 million related to better wholesale shipments and the balance from D2C; they see no meaningful timing differences between Q4 and Q1.
"As it relates to the third quarter, the beat from a revenue standpoint, certainly the lion's share of that related to timing." — Jim Swanson (CFO)
China growth and tariffs/promotions
Q (Laurent Vasilescu · BNP Paribas): What's driving stronger China growth and can that momentum continue? Also, what assumptions drive the tariff pressure and why was the DTC promotions headwind removed?
A: They said China acceleration was driven by local marketplace strategies and strong execution, despite a challenging and more competitive macro environment. Management reiterated a full-year expectation of double-digit percent level growth in China. On tariffs, they said this year reflects the full-year impact of incremental U.S. tariffs versus last year, and that the tariff impact is offset by the high single-digit price increases implemented for Spring '26 and Fall '26; they also cited better full-price realization and a pullback in promotions as reasons to remove a DTC promotions headwind.
"The offset to that is the high single-digit price increases that we implemented for both Spring '26 and Fall '26." — Jim Swanson (CFO)
Q4 guide, shipment timing, DTC outlook
Q (Mauricio Serna Vega · UBS): How much of the Q4 growth range is due to shipment timing, and can the U.S. DTC positive trend sustain across channels? How should we think about 2027 gross margin?
A: They said timing shifts between Q3 and Q4 are about a $30 million shift, which equates to a 2.5 to 3 percentage points impact to revenue growth in each quarter. For DTC, brick-and-mortar is planned more or less in line with Q3 (DTC brick-and-mortar was up 4% in Q3), and e-commerce is planned at a low double-digit percent level for Q4 after finishing high-single digit (8%, 9%) in Q3. On 2027 gross margin, they said it's too early to provide detail beyond adjusting for tariff refunds and factory accommodations and that many variables remain; they will give an update at the year-end call in February.
"As it relates to the timing shifts between Q3 and Q4, it's about a $30 million shift." — Jim Swanson (CFO)
ACCELERATE strategy progress
Q (Tom Nikic · Needham): How much progress have you made on ACCELERATE for product and marketing? Are more improvements needed?
A: They said ACCELERATE is a long-term strategy and they are encouraged by momentum, especially in consumer focus and marketing. Engineered for Whatever is only a little more than a year old and is helping reach target consumers. Management also said product work is progressing with new items like the Amaze Puff, MTR fleece, Helvetia fleece, and new footwear focused on Omni-MAX.
"We're very encouraged with some of the momentum we're seeing, particularly around our consumer focus and being able to reach them with the marketing, which I'll remind, Engineered for Whatever is just a little more than a year old." — Joseph Boyle (PRESIDENT)