Columbia Sportswear Q4 Earnings Beat Estimates, Sales Down Y/Y

Columbia Sportswear Company COLM reported fourth-quarter 2025 results, wherein both sales and earnings beat the Zacks Consensus Estimate. However, both top and bottom lines decreased year over year.The company reported fourth-quarter results above guidance, driven by stronger-than-expected demand in the United States, despite ongoing challenges in the domestic market. International markets continued to grow and early signs suggest the company’s ACCELERATE Growth Strategy, supported by new product launches and refreshed marketing, is gaining traction with consumers.COLM’s Quarterly Performance: Key Metrics & InsightsThis designer, marketer and distributor of outdoor and active lifestyle apparel, footwear and accessories reported earnings of $1.73 per share, surpassing the Zacks Consensus Estimate of $1.22. However, the bottom line decreased 3.9% from $1.80 reported in the prior-year period.Columbia Sportswear Company Price, Consensus and EPS Surprise Columbia Sportswear Company price-consensus-eps-surprise-chart | Columbia Sportswear Company QuoteThe company generated net sales of $1,070.2 million, which exceeded the Zacks Consensus Estimate of $1,037 million. The metric fell 2.4% from the year-ago period. The decline was largely timing-related, as some Fall 2025 wholesale shipments were pulled forward into earlier periods. This was partly offset by continued momentum in the direct-to-consumer (“DTC”) channel and solid performance in international markets, which helped cushion weaker demand in the United States. Net sales decreased 3% at constant currency.Gross profit decreased 1.6% year over year to $551.7 million. The gross margin increased 50 basis points (bps) to 51.6%, which fared better than our estimate of 50.7%, mainly driven by improved inventory quality that reduced markdowns and promotional activity, along with lower inventory write-downs. These benefits were partially offset by higher U.S. tariffs, which negatively affected gross margin by $20 million before mitigation measures.SG&A expenses were up 2.5% to $441.5 million from $430.6 million reported in the year-ago quarter. As a percentage of sales, the same increased 200 bps to 41.3%. The increase was primarily driven by higher DTC-related spending and one-time costs tied to the company’s profit improvement initiatives. These increases were partly offset by savings in technology and supply-chain operations.Columbia Sportswear reported an operating income of $116.7 million, down 15% from the year-ago quarter. Operating margin decreased 160 bps to 10.9%.COLM’s Sales by Channels & Regional SegmentsIn the United States, net sales declined 8% year over year to $626 million, which slightly missed our estimate of $633.3 million. Net sales surged 8% to $174.4 million in Europe, the Middle East and Africa, surpassing our estimate of $147.1 million. Latin America and Asia Pacific net sales grew 8% to $203.2 million, beating our estimate of $186.3 million. In Canada, net sales increased 2% to $66.5 million, which lagged our estimate of $74.4 million.During the quarter, DTC sales increased 1% to $640.8 million. Our model expected total DTC sales of $610.1 million for the quarter. Wholesale channel sales went down 7% to $429.4 million, which missed our estimate of $431 million.COLM’s Sales by Product Category & BrandNet sales in the Apparel, Accessories and Equipment category inched down 2% to $855 million, which beat our estimate of $816.8 million. Footwear's net sales fell 5% to $215.3 million, which lagged our estimate of $224.3 million. Columbia, SOREL and Mountain Hardwear brands registered sales declines of 1%, 18% and 5%, respectively. Sales for the prAna brand increased 6% year over year.Other Financial Updates of COLMThe company ended the quarter with cash and cash equivalents of $442 million, short-term investments of $348.8 million and shareholders’ equity of almost $1,710.1 million. COLM had no debt on its balance sheet as of Dec. 31, 2025. Inventories remained broadly stable at $689.5 million compared with $690.5 million reported in the year-ago quarter.For the year ended Dec. 31, 2025, Columbia Sportswear’s cash provided by operating activities was $282.9 million and capital expenditures were $66.2 million. For the 12 months ended Dec. 31, 2025, the company repurchased 2,972,889 shares of common stock for a total of $201.1 million. As of Dec. 31, 2025, $426.5 million remained available under its stock repurchase authorization. Management announced a regular quarterly cash dividend of 30 cents per share, payable on March 20, 2026, to its shareholders of record as of March 9.What to Expect From COLM AheadFor 2026, the company expects net sales to grow 1% to 3%, implying revenues of $3.43 billion to $3.50 billion, up from $3.40 billion in 2025. Favorable foreign exchange movements are anticipated to contribute roughly 50-100 basis points to reported sales growth.Gross margin is projected to decline to a range of 49.8% to 50% compared with 50.5% in 2025, indicating a contraction of 50 bps to 70 bps. This outlook incorporates an estimated 300 bps headwind from incremental tariffs before any mitigating actions. Operating margin is expected to improve modestly to between 6.2% and 6.9%, compared with 6.1% in the prior year, implying incremental operating leverage despite margin pressures at the gross profit level.Earnings per share are forecasted to range from $3.20 to $3.65, broadly in line with the $3.23 reported in 2025.The company expects first-quarter 2026 net sales of $747 million to $759 million, implying a year-over-year decline of approximately 2.5% to 4% from $778 million in the prior-year period. Favorable foreign exchange effects are expected to add roughly 200 bps to reported revenues. Operating margin is projected to fall sharply to a range of 2.1% to 2.9%, compared with 6% in the same quarter of 2025. Earnings per share for the first quarter are expected to decline between 29 cents and 37 cents, compared with 75 cents in the comparable period last year.Shares of this Zacks Rank #3 (Hold) company have gained 14.4% in the past three months compared with the industry’s 8.6% growth.Image Source: Zacks Investment ResearchKey PicksVince Holding Corp. VNCE provides luxury apparel and accessories in the United States and internationally. At present, the company flaunts a Zacks Rank of 1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.The Zacks Consensus Estimate for VNCE’s current fiscal-year sales and earnings implies growth of 2.1% and 26.3%, respectively, from the year-ago figures. VNCE delivered a trailing four-quarter earnings surprise of 229.6%, on average.Ralph Lauren Corporation RL designs, markets and distributes lifestyle products in North America, Europe, Asia and internationally. At present, RL has a Zacks Rank of 2 (Buy). RL delivered a trailing four-quarter earnings surprise of 9.8%, on average.The Zacks Consensus Estimate for Ralph Lauren’s current fiscal-year sales and earnings implies growth of 10% and 25.6%, respectively, from the year-ago figures. Revolve Group, Inc. RVLV operates as an online fashion retailer for millennial and generation z consumers in the United States and internationally. It currently carries a Zacks Rank of 2. RVLV delivered a trailing four-quarter average earnings surprise of 61.7%.The Zacks Consensus Estimate for Revolve Group’s current fiscal-year sales and earnings implies growth of 6.8% and 8.7%, respectively, from the year-ago figures.Free Report: Profiting from the 2nd Wave of AI ExplosionThe next phase of the AI explosion is poised to create significant wealth for investors, especially those who get in early. It will add literally trillion of dollars to the economy and revolutionize nearly every part of our lives.Investors who bought shares like Nvidia at the right time have had a shot at huge gains.But the rocket ride in the "first wave" of AI stocks may soon come to an end. The sharp upward trajectory of these stocks will begin to level off, leaving exponential growth to a new wave of cutting-edge companies.Zacks' AI Boom 2.0: The Second Wave report reveals 4 under-the-radar companies that may soon be shining stars of AI’s next leap forward.Access AI Boom 2.0 now, absolutely free >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Columbia Sportswear Company (COLM): Free Stock Analysis Report Ralph Lauren Corporation (RL): Free Stock Analysis Report Vince Holding Corp. (VNCE): Free Stock Analysis Report Revolve Group, Inc. (RVLV): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks