Hanesbrands reported mixed Q3 2025 results, with a slight decrease in net sales but significant improvements in operating profit and adjusted EPS, driven by cost savings and a discrete tax benefit. The company is progressing towards its full-year EPS outlook despite a late-quarter sales shift.
Operating Profit increased 14% over prior year to $108 million and Operating Margin increased 160 basis points to 12.1%.
positiveAdjusted Operating Profit increased 3% to $116 million and Adjusted Operating Margin increased 45 basis points to 13.0%.
positiveAdjusted EPS increased 25% to $0.15.
positiveLeverage decreased to 3.3 times net debt-to-adjusted EBITDA, an improvement of 1.0 times compared to prior year.
positiveHanes brand continued to gain market share during the back-to-school season.
positiveNet Sales of $892 million decreased 1% compared to prior year.
negativeOn an organic constant currency basis, Net Sales decreased 4.9% compared to prior year.
negativeGross Profit decreased 3% to $363 million and Gross Margin decreased 70 basis points to 40.8% as compared to prior year, driven by unfavorable business and customer mix.
attentionInventory at the end of third-quarter 2025 of $991 million increased 10%, or $94 million, year-over-year, with the vast majority of the increase driven by the impact from tariffs.
attentionCash Flow from Operations was $28 million in third-quarter 2025, compared to $92 million last year. Free Cash Flow for the quarter was $22 million as compared to $88 million last year.
negativeMargin expansion indicates improving profitability and operational efficiency. Measured in basis points (bps): 100 bps = 1.0%.
Forward-looking guidance is subject to change and does not constitute a guarantee. Actual results may differ materially from these estimates.
Special items are non-recurring events that may distort period-over-period comparisons. Analysts typically adjust for these when calculating normalized earnings.
The top-line results reflect an unanticipated late quarter shift in replenishment orders at one of our large U.S. retail partners.
Underlying fundamentals of our business continue to improve, with inventory position at retail strong and unit point-of-sale trends sequentially improving each month.
Strong back-to-school season as the Hanes brand continued to gain market share.
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