Fiscal 2026 Revenue and Regional Growth
Fiscal 2026 revenue of $5.0B (down 4% YoY) with strength in EMEA (+9% FY) and pockets of growth in APAC and Latin America; Q4 revenue of $1.2B (down 1% YoY) with APAC Q4 +13% (8% cc) and Latin America Q4 +22% (8% cc).
Improving Direct-to-Consumer Performance
Q4 DTC revenue up 5% with owned & operated stores up 8% while e-commerce was flat, showing early improvements in brick-and-mortar owned retail performance and DTC execution.
Profitability Progress (Fiscal Year)
Fiscal '26 adjusted operating income of $107M and adjusted diluted EPS of $0.12, demonstrating positive adjusted profitability for the year despite headwinds.
Inventory Discipline and Assortment Simplification
Year-end inventory of $915M, down 3% YoY, and SKU count reduced ~25% over the past two years, signaling cleaner, higher-quality inventory and simpler assortment.
Planned Gross Margin Expansion for Fiscal '27
Company expects gross margin to expand ~220–270 bps in fiscal '27, driven primarily by a tariff-related refund (~150 bps) plus pricing, reduced promotions and more favorable channel mix.
Clear Strategic Focus and Product Innovation
Management emphasized product premiumization, category management (about a dozen sports), focus on top-10 volume-driving products, and upcoming product launches (e.g., BANT/Bounce, premium T-shirt innovations) to drive higher-quality revenue.
Targeted Marketing Investment to Accelerate Rebound
Planned incremental marketing investment (~$30M) within historical marketing envelope to better activate product and partnerships; management expects faster brand connection gains from marketing changes.
Balance Sheet Step Forward
Restricted investments of $605M set aside to cover senior notes due in June; after payoff that obligation the company expects a stronger balance sheet; ended year with $309M cash and $200M revolver borrowings.