## Canada Goose Beats Q2 Earnings Expectations, Revenue Down 5% YoY
Canada Goose Holdings Inc. (GOOS) delivered a strong second-quarter fiscal 2025 performance, exceeding revenue estimates despite facing a challenging macro environment. The company reported adjusted earnings per share of 5 cents, surpassing analyst expectations for a loss of 4 cents.
Revenue for the quarter reached $267.8 million, beating the anticipated $260.47 million. However, total revenue experienced a 5% year-over-year decline. The drop was attributed to a 5% decrease in Direct-to-Consumer (DTC) revenue and a 15% decline in Wholesale revenue. Notably, Other revenue saw a significant increase of $16.9 million to $26.6 million, primarily driven by the clearing of slow-moving and discontinued inventory.
Canada Goose’s inventory levels also saw a positive development, decreasing 9% year-over-year to $473.4 million at the end of the quarter. This reduction was achieved through controlled production and sales strategies. Additionally, the company managed to reduce net debt to $826.4 million, down from $851.9 million a year ago.
“Our second quarter performance reflected steady progress across our operating priorities, as we navigated an increasingly challenging macro environment that affected consumer sentiment,” said Dani Reiss, chairman and CEO of Canada Goose. The company is actively investing in expanding its retail presence and ramping up marketing efforts ahead of the holiday season. This includes launching its Fall/Winter 2024 collection and engaging in live shopping experiences on the popular Chinese platform Douyin.
In light of the current market conditions, Canada Goose adjusted its fiscal 2025 outlook. The company now expects a low-single-digit decrease to low-single-digit increase in full-year revenue, reflecting increased pressure on global luxury consumer spending and planned marketing investments. Previously, the company had projected low-single-digit growth for the full year.
Despite the revised outlook, Canada Goose shares experienced a positive reaction, rising 2.56% to $9.84 at the time of writing. The company’s ability to outperform earnings expectations and manage its inventory effectively, coupled with its strategic investments in retail expansion and marketing, suggest a continued commitment to navigating the current market challenges and capturing future growth opportunities.
