Helen of Troy Limited Reports Disappointing First Quarter FY’26 Results

Helen of Troy Limited (NASDAQ: HELE) has released its first quarter fiscal 2026 results, showing a significant decline in net sales and a substantial GAAP diluted loss per share. The company also provided guidance for the second quarter, highlighting expectations amidst ongoing market challenges.

Helen of Troy Reports Net Sales Decline of 10.8%

In the first quarter of fiscal 2026, Helen of Troy Limited reported a consolidated net sales revenue decline of 10.8%, amounting to $371.7 million compared to $416.8 million in the previous year. This decrease was driven primarily by a 17% decline in organic business revenue, attributed to reduced sales in the Beauty & Wellness and Home & Outdoor segments.

The company faced challenges such as lower sales of thermometers, fans, and hair appliances, and a decrease in home and insulated beverageware sales.

Despite these setbacks, Helen of Troy noted positive contributions from the acquisition of Olive & June, which added $26.8 million to net sales. The gross profit margin decreased to 47.1% from 48.7% due to factors like consumer trade-down behavior and a less favorable brand mix. The company also faced an operating loss of $407 million, largely due to non-cash asset impairment charges amounting to $414.4 million.

Comparing the actual performance against expectations, the company fell short of the anticipated EPS of $0.91, reporting an adjusted diluted EPS of $0.41. Revenue expectations were also not met, as the actual figure of $371.7 million was below the expected $399.33 million. These results highlight the impact of ongoing challenges, including tariff-related pressures and shifting consumer behaviors.

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Helen of Troy Issues Catuious Outlook, Expects Sales to Decline

Looking ahead to the second quarter of fiscal 2026, Helen of Troy has provided a cautious outlook, reflecting the uncertainties in the global market. The company expects consolidated net sales to range between $408 million and $432 million, indicating a potential decline of 14.0% to 8.9% compared to the second quarter of fiscal 2025. This outlook considers continued softness in consumer spending, a more promotional market environment, and the impact of tariffs.

Helen of Troy anticipates a GAAP diluted EPS between $0.56 and $0.68, with an adjusted diluted EPS forecasted to fall between $0.45 and $0.60. The company is actively working to mitigate the impact of tariffs by diversifying production outside of China and implementing cost reduction measures. These efforts aim to reduce the net tariff impact on operating income to less than $15 million.

Despite the challenges, Helen of Troy remains committed to strategic growth investments, albeit with a disciplined approach due to tariff volatility. The company is focused on optimizing its marketing, promotional, and product development strategies to capture opportunities with the highest returns. As it navigates the current economic landscape, Helen of Troy is determined to create a more agile and efficient organization, poised for future success.

Disclaimer: The author does not hold or have a position in any securities discussed in the article. All stock prices were quoted at the time of writing.