Guess?, Inc., the American fashion retailer, has reported an improvement in earnings for the third quarter. The company’s net earnings reached $26.4 million, or $0.41 per diluted share, compared to $12.4 million, or $0.18 per diluted share, in the same quarter last year. Despite a decrease in total net revenue of 7.6% (10.1% in constant currencies), from $615.9 million to $569.3 million, Guess managed to significantly expand its operating margin. The operating margin rose by 410 basis points to 7.8% due to successful cost-cutting measures.

The Covid-19 pandemic had a significant impact on Guess, particularly in its Americas wholesale segment. Revenues in this segment declined by 36.2% year over year. The retail revenues in the same region also decreased by 26.7%. However, Guess saw a 16% increase in revenues in Europe, despite a 9% decline in retail sales. CEO Carlos Alberini expressed satisfaction with the company’s performance in the third quarter, considering the challenging circumstances caused by the pandemic. Alberini emphasized the company’s ongoing efforts to transform its business model and elevate its brand.

However, for the year-to-date, Guess reported a net loss of $151.6 million, or $2.35 per diluted share, compared to net earnings of $16.4 million, or $0.22 per diluted share, in the same period last year. Total net revenue for the period decreased by 33.1%, reaching $1.23 billion, down from $1.84 billion in the previous year.

Guess did not provide detailed financial guidance for the fourth quarter due to the uncertainty surrounding the Covid-19 pandemic. However, the company expects revenues for the period to decrease in the low to mid-twenties. This is mainly due to government-mandated store closures in Europe and Canada as a result of the health crisis.

Despite these challenges, Guess remains confident in its brand, product, and team’s ability to navigate through the current market conditions. The company operates a significant number of stores globally and aims to overcome the obstacles presented by the pandemic and continue its growth trajectory.

Useful Links:
Guess Official Website
Guess Q3 Financial Results