G-III Apparel increases full year earnings guidance despite Q1 sales dip

US fashion group G-III Apparel Group (G-III) has reported its financial results for the first quarter of fiscal year 2027, ended April 30, 2026. The company reported net sales of 536 million dollars, representing an 8 percent decrease compared to the same period of the prior year.

Despite the revenue decline, net income for the first quarter increased to 66.50 million dollars, or 1.50 dollars per diluted share, including a 77.90 million dollar benefit under the International Emergency Economic Powers Act. On a non-GAAP basis, net income per share for the first quarter was a loss of 0.21 dollars per share, compared to an income of 0.19 dollars per diluted share last year, while gross margin increased by 2,270 basis points to 64.9 percent.

G-III chairman and chief executive officer, Morris Goldfarb, stated: “The quarter was better than expected with both our net sales and earnings coming in ahead of guidance. Our go-forward portfolio saw continued momentum and healthy full-price selling, which contributed to meaningful gross margin expansion versus the prior year.”

Strategic acquisition of Marc Jacobs

The financial report follows the company's recently announced definitive agreement to acquire the US designer brand Marc Jacobs in partnership with brand management firm WHP Global. The transaction will establish a 50/50 joint venture to hold the intellectual property of the brand, with G-III managing the global operating business.

Goldfarb added: “Marc Jacobs is one of the most influential brands in fashion, and we see tremendous opportunity to build on its strong foundation and drive long-term growth across categories, channels, and geographies.” The current financial outlook does not incorporate any potential impact from this pending transaction.

Revision of fiscal year 2027 earnings outlook

Based on the first quarter performance, G-III has updated its financial guidance for the full fiscal year ending January 31, 2027. Net sales are projected to reach approximately 2.71 billion dollars, down from 2.96 billion dollars in fiscal year 2026. This estimation accounts for an anticipated loss of approximately 470 million dollars in sales from Calvin Klein and Tommy Hilfiger products.

Full year net income is expected to range between 171 million dollars and 175 million dollars, with diluted earnings per share between 3.85 dollars and 3.95 dollars. This is an increase from the net income of 67.40 million dollars reported in fiscal year 2026. Non-GAAP net income is projected between 95.00 million dollars and 99 million dollars, down from 116.20 million dollars in the prior year. Adjusted EBITDA is forecast between 178 million dollars and 182 million dollars, compared to 192.40 million dollars in fiscal year 2026.

For the second quarter ending July 31, 2026, G-III expects net sales of approximately 570 million dollars, compared to 613.30 million dollars in the second quarter of the prior year. Second quarter net income and non-GAAP net income are both projected to sit between 7 million dollars and 11 million dollars, compared to 10.90 million dollars and 11.20 million dollars respectively in the same period last year.