Helen of Troy Limited (HELE) Reports Mixed Q2 Results

Helen of Troy Limited, a global consumer products company, recently released its second-quarter fiscal 2026 results. The company faced challenges this quarter, including a decline in sales and increased costs, but also provided insights into its future guidance.

HELE: Net Sales Fall to $431.8 Million, EPS Beats Adjusted Estimates

In the second quarter of fiscal 2026, Helen of Troy Limited (NASDAQ: HELE) reported a consolidated net sales revenue of $431.8 million, marking an 8.9% decline compared to the same period in fiscal 2025. This decrease was primarily driven by a 16.0% reduction in the company’s organic business, reflecting lower sales in the Beauty & Wellness and Home & Outdoor segments. Despite these challenges, the acquisition of Olive & June contributed $33.4 million, offsetting some of the losses.

Compared to the expected earnings per share (EPS) of $0.54, the company achieved an adjusted diluted EPS of $0.59, surpassing expectations. However, the GAAP diluted loss per share was $13.44, a significant drop from the previous year’s earnings per share of $0.74. The loss was largely attributed to non-cash asset impairment charges amounting to $326.4 million.

Gross profit margin fell to 44.2% from 45.6% in the previous year, driven by higher tariffs on goods sold and increased promotional expenses. The operating margin was deeply affected, recording a loss of 73.1%, compared to a positive margin of 7.3% in the prior year. This was primarily due to the impairment charges and increased selling, general, and administrative expenses, which rose to 41.0% from 37.9%.

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Helen of Troy Reaffirms Fiscal 2026 Outlook, Focuses on Cost Control

Looking ahead, Helen of Troy Limited has set a fiscal 2026 outlook with consolidated net sales projected to be between $1.739 billion and $1.780 billion, implying a decline of 8.8% to 6.7% from the previous fiscal year. The company anticipates a GAAP diluted loss per share between $29.90 and $29.40, with adjusted diluted EPS expected to range from $3.75 to $4.25.

The company is actively working on mitigating the impact of tariffs by diversifying its production outside of China and implementing cost reductions and strategic price increases. These efforts are aimed at reducing the net tariff impact on operating income to less than $20 million. Additionally, Helen of Troy plans to continue investing in growth opportunities and new product development to support future revenue expansion.

For the third quarter of fiscal 2026, the company expects net sales revenue to be between $491 million and $512 million, reflecting a decline of 7.5% to 3.5% compared to the same quarter last year. The forecast includes a projected contribution from the Olive & June acquisition. Helen of Troy remains cautious, acknowledging ongoing challenges such as consumer spending softness and macroeconomic uncertainties, but remains committed to strategic investments and operational efficiency improvements.

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.