Bath & Body Works Slides Despite Earnings Beat as Guidance Disappoints

Shares of retailer Bath & Body Works (BBWI) slid in premarket trading Tuesday despite a first-quarter earnings report that surpassed analyst expectations and the company’s own guidance.

Net sales slipped less than 1% year-over-year to $1.38 billion, just above analyst expectations of $1.37 billion, according to estimates compiled by Visible Alpha. Profit rose 7% to $87 million, or 38 cents per share, better than the $72.4 million and 32 cents per share analysts had expected. In guidance released in its previous quarterly report, Bath & Body Works had projected a first-quarter sales decline of 2% to 4.5%, with EPS expected between 28 cents to 33 cents.

Full-Year Outlook Narrowed, Q2 Guidance Misses Estimates

The retailer also lifted the floor of its guidance ranges for the full fiscal year, projecting net sales to range from a 2.5% decline to flat from the 2023 mark of $7.43 billion, while EPS is expected between $3.05 to $3.35, down from last year’s $3.84 figure.

Originally, Bath & Body Works projected sales to range from a 3% decline to flat, while EPS was projected between $3.00 and $3.35. Analysts project revenue of $7.41 billion for the full year, and EPS of $3.31.

For the second quarter, Bath & Body Works projects sales to range from a 2% drop to flat compared to last year’s $1.56 billion, while analysts project $1.54 billion. The retailer guided EPS from 31 cents to 36 cents, with the top of that range matching the number analysts anticipate.

Shares fell 5.4% to $49.00 about 30 minutes before the opening bell Tuesday, but are still up more than 13% from the start of the year.