Core Insights - Zumiez Inc. is focusing on its North American operations to drive a strong recovery in fiscal 2025, with regional net sales reaching $180 million in Q2, a 2.1% increase year-over-year, and comparable sales growing 4.2% for the sixth consecutive quarter [1][8] - The company has implemented a refined merchandising and pricing strategy, introducing over 120 new brands in 2024 and increasing private-label products to 30% of total sales, contributing to higher average unit retail prices and sales [2][5] - Gross profit for the fiscal second quarter was $76 million, a 5.9% increase from the previous year, with gross margin improving by 130 basis points to 35.5% due to product margin gains and better store occupancy cost leverage [3][8] Sales and Growth Expectations - Management anticipates comparable sales growth of 5.5% to 7.5% for Q3, with a strong start to the fall season indicated by a 13% increase in North American comps during the first 30 days of the fiscal third quarter [4][8] - Despite planned store closures, the company expects North America to contribute significantly to its targeted total sales growth of 3% to 4% for fiscal 2025 [4] Financial Performance and Valuation - Zumiez shares have increased by 4.5% year-to-date, contrasting with an 8.9% decline in the industry [6] - The company trades at a forward price-to-sales ratio of 0.37X, significantly lower than the industry average of 1.76X, indicating a favorable valuation [7] - The Zacks Consensus Estimate for Zumiez's fiscal 2025 earnings suggests a remarkable year-over-year growth of 566.7%, with upward revisions in estimates for both fiscal 2025 and 2026 [9][10]

Group 1 - Two apparel stocks, Zumiez Inc. and Shoe Carnival Inc., are experiencing significant declines in their Growth scores within Benzinga's Edge Stock Rankings [1][2] - A dip in growth scores indicates poor quarterly performance, negatively impacting the compounded annual growth rate and relative rankings among stocks [3] Group 2 - Zumiez Inc. has seen a drop of 39.8 points in its Growth score, falling from 62.57 to 22.77, primarily due to a disappointing second-quarter performance with same-store sales increasing only 2.5% year-over-year [4] - The company is facing ongoing losses attributed to margin pressures, litigation expenses, and macroeconomic uncertainties, including tariffs [4] - Shoe Carnival Inc.'s Growth score has decreased from 90.37 to 59.97, influenced by multiple headwinds affecting its core business and a reduction in full-year sales forecasts [6] - The decline in Shoe Carnival's Growth score has negatively impacted investment sentiment and stock performance [6]

Core Viewpoint - Zumiez (ZUMZ) is showing solid improvement in earnings estimates, indicating potential for continued stock price momentum due to an improving earnings outlook [1][2]. Estimate Revisions - Analysts are increasingly optimistic about Zumiez's earnings prospects, as reflected in the upward trend of estimate revisions, which correlates strongly with near-term stock price movements [2]. - The current-quarter earnings estimate is projected at $0.28 per share, representing a year-over-year increase of +366.7%. Over the last 30 days, the Zacks Consensus Estimate has risen by 93.02% with three upward revisions and no negative changes [6]. - For the full year, the earnings estimate stands at $0.42 per share, reflecting a significant change of +566.7% from the previous year. There have been two upward revisions in the past month, contributing to the positive consensus estimate [7]. Zacks Rank - Zumiez has achieved a Zacks Rank 1 (Strong Buy), indicating strong agreement among analysts in raising earnings estimates. This rank is based on a proven track record of outperforming the market, with Zacks 1 Ranked stocks averaging a +25% annual return since 2008 [3][8]. - Stocks with Zacks Rank 1 and 2 (Buy) have been shown to significantly outperform the S&P 500 [8]. Stock Performance - Zumiez shares have increased by 49.9% over the past four weeks, suggesting that investors are responding positively to the company's impressive estimate revisions [9].

Group 1 - The Seattle-based retailer has not delivered satisfactory returns for investors over both the long term and short term [1] - There is no indication of any stock, option, or similar derivative positions held by the analyst in the companies mentioned [1] Group 2 - The article expresses personal opinions and does not provide compensation for the views expressed [2] - Seeking Alpha clarifies that past performance does not guarantee future results and does not provide specific investment recommendations [2]

Core Insights - Zumiez Inc. reported second-quarter fiscal 2025 results with net sales of $214.3 million, surpassing estimates and showing a year-over-year increase of 1.9% [4][19] - The company experienced a quarterly loss of 6 cents per share, which was narrower than the expected loss of 11 cents but wider than the loss of 4 cents in the previous year [3][19] - Comparable sales rose 2.5% year over year, marking the fifth consecutive quarter of growth, driven by higher dollars per transaction despite a decline in the number of transactions [5][19] Financial Performance - Total net sales of $214.3 million exceeded the Zacks Consensus Estimate of $211 million, with North America sales contributing $180 million, up 2.1% year over year [4][6] - Gross profit increased by 5.9% to $76 million, with gross margin expanding by 130 basis points to 35.5% due to improved product margins and leveraging store occupancy costs [8][9] - Selling, general and administrative (SG&A) costs rose 5.2% to $75.9 million, representing 35.4% of sales, an increase of 100 basis points from the previous year [9][10] Regional and Category Performance - North America comparable sales increased by 4.2%, while international comparable sales declined by 5.5% [7] - The women's category saw the highest increase in comparable sales, while footwear experienced the largest decline [7] Cash Flow and Shareholder Equity - As of August 2, 2025, cash and current marketable securities totaled $106.7 million, down from $127 million a year earlier, primarily due to share repurchases and capital expenditures [11][12] - Total shareholders' equity stood at $292.4 million, with the company repurchasing 0.6 million shares at an average price of $13.10 per share [12] Store Operations - Zumiez operated 730 stores as of August 30, 2025, with plans to open six new stores and close 20 stores in fiscal 2025 [13] Future Guidance - For Q3 fiscal 2025, total sales are expected to be between $232 million and $237 million, with comparable sales growth anticipated at 5.5-7.5% [19] - The company forecasts 3-4% year-over-year sales growth for fiscal 2025, despite planned store closures [20][21]

Group 1 - Zumiez Inc. reported strong Q2 '25 results with positive guidance for BTS season results in September, although Q3 '25 and FY25 guidance are more moderate [1] - The company is experiencing increased long-only investment interest, focusing on operational aspects and long-term earnings potential rather than market-driven dynamics [1] - The investment strategy emphasizes holding companies for the long term, with a preference for providing hold recommendations rather than buy, reflecting a cautious approach in a bullish market [1]

Core Viewpoint - Zumiez reported a quarterly loss of $0.06 per share, which was better than the Zacks Consensus Estimate of a loss of $0.11, indicating a positive earnings surprise of +45.45% [1] - The company has shown mixed performance in terms of earnings estimates, with a Zacks Rank of 3 (Hold), suggesting it is expected to perform in line with the market in the near future [6] Financial Performance - Zumiez posted revenues of $214.28 million for the quarter ended July 2025, surpassing the Zacks Consensus Estimate by 1.78% and showing an increase from $210.18 million year-over-year [2] - The company has exceeded consensus revenue estimates three times over the last four quarters [2] Stock Performance - Zumiez shares have declined approximately 8.5% since the beginning of the year, contrasting with the S&P 500's gain of 9.6% [3] - The sustainability of the stock's price movement will depend on management's commentary during the earnings call [3] Future Outlook - Current consensus EPS estimate for the upcoming quarter is $0.15 on revenues of $223.07 million, and for the current fiscal year, it is $0.16 on revenues of $901.34 million [7] - The outlook for the Retail - Apparel and Shoes industry, where Zumiez operates, is currently in the bottom 39% of Zacks industries, which may impact the stock's performance [8]

Financial Data and Key Metrics Changes - Second quarter net sales were $214.3 million, up 1.9% from $210.2 million in the second quarter of 2024 [8] - Comparable sales grew 2.5%, marking the fifth consecutive quarter of positive comparable sales growth [2][3] - Gross profit for the second quarter was $76 million, up 5.9% compared to $71.8 million in the second quarter of last year [9] - Gross profit as a percentage of sales increased to 35.5% from 34.2% in the second quarter of 2024 [10] - Operating income was $0.1 million, or 0.1% of net sales, compared to an operating loss of $0.4 million, or 0.2% of net sales last year [11] - Net loss for the second quarter was $1 million, or $0.06 per share, compared to a net loss of $0.8 million, or $0.04 per share in the second quarter of 2024 [12] Business Line Data and Key Metrics Changes - North America net sales were $180 million, an increase of 2.1% from 2024, while other international net sales were $34.2 million, up 1% from last year [8] - Comparable sales for North America were up 4.2%, marking the sixth consecutive quarter of comparable sales growth [9] - Private label performance reached 30% of total sales year to date through the second quarter, up from 27% a year ago [4] Market Data and Key Metrics Changes - North America business showed strength with low teens comparable sales growth in August, indicating positive momentum heading into the holiday season [3] - Other international comparable sales declined 5.5% in the second quarter, reflecting challenging market conditions [9] Company Strategy and Development Direction - The company is focused on three strategic priorities: driving revenue growth through customer-focused initiatives, optimizing profitability across geographic footprints, and managing volatility while funding expansion [3][5] - Continued investment in staff development and technological capabilities to enhance customer experiences [4] - Plans to open six new stores during the year while closing approximately 20 stores, including up to 17 in the United States [20] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ability to generate value despite economic volatility and uncertainties around tariffs [6] - The company anticipates total sales for the third quarter to be between $232 million and $237 million, with comparable sales growth of 5.5% to 7.5% over the prior year [18] - Management remains cautious due to broader economic uncertainties but is optimistic about the back-to-school season performance [17] Other Important Information - Cash and liquid investments exceeded $106 million at quarter end, with no debt on the balance sheet [6][14] - The company repurchased 0.6 million shares at an average cost of $13.10 per share during the second quarter [14] Q&A Session Summary Question: What are the assumptions for comparable sales for the balance of the quarter? - Management assumes a lower comp level in the low single digits to end the quarter, with potential upside if they exceed expectations [24] Question: What is driving the increase in average unit retail (AUR)? - AUR increases are attributed to a combination of higher MSRPs due to tariffs, mixed shifts in business, and lower levels of promotions [27][28] Question: What categories are seeing the most strength in private label? - The private label business is strong in denim and other key categories, reflecting a strategic focus on unique products and trend cycles [30][32] Question: What are the biggest headwinds facing the European business? - Economic conditions in Europe, particularly in Germany, and the need for better assortment differentiation are key challenges [44][45]

[Fiscal 2025 Second Quarter Results Overview](index=1&type=section&id=Fiscal%202025%20Second%20Quarter%20Results%20Overview) Zumiez Inc. reported its second quarter and year-to-date financial performance, highlighting sales growth, net losses, liquidity, and future outlook [Second Quarter Financial Highlights](index=1&type=section&id=Second%20Quarter%20Financial%20Highlights) Zumiez Inc. reported a 1.9% increase in net sales for the second quarter of fiscal 2025, reaching $214.3 million, alongside a net loss of $1.0 million Fiscal 2025 Second Quarter Financial Performance | Metric | Q2 FY25 (13 weeks) | Q2 FY24 (13 weeks) | Change (YoY) | | :-------------------------------- | :----------------- | :----------------- | :------------- | | Net Sales | $214.3 million | $210.2 million | +1.9% | | Comparable Sales Growth | +2.5% | +3.6% | -1.1 pp | | Net Loss | $(1.0) million | $(0.8) million | +25.0% | | Diluted Loss Per Share | $(0.06) | $(0.04) | +50.0% | - North American comparable sales increased by **4.2%** in the second quarter[1](index=1&type=chunk) [Year-to-Date Financial Highlights](index=1&type=section&id=Year-to-Date%20Financial%20Highlights) For the first six months of fiscal 2025, net sales grew by 2.9% to $398.6 million, with a net loss of $15.3 million, an improvement from the prior year Fiscal 2025 Year-to-Date Financial Performance (Six Months) | Metric | YTD FY25 (26 weeks) | YTD FY24 (26 weeks) | Change (YoY) | | :-------------------------------- | :------------------ | :------------------ | :------------- | | Net Sales | $398.6 million | $387.6 million | +2.9% | | Comparable Sales Growth | +3.9% | N/A | N/A | | Net Loss | $(15.3) million | $(17.6) million | -13.07% | | Diluted Loss Per Share | $(0.88) | $(0.91) | -3.3% | - The first six months of 2025 were negatively impacted by **$3.6 million**, or approximately **$0.15 per share**, related to the settlement of a wage and hours lawsuit in California[3](index=3&type=chunk) [Liquidity and Share Repurchases](index=1&type=section&id=Liquidity%20and%20Share%20Repurchases) Zumiez held $106.7 million in cash and marketable securities as of August 2, 2025, a decrease primarily due to share repurchases and capital expenditures Cash and Current Marketable Securities (Millions) | Date | Amount | | :---------------- | :---------------- | | August 2, 2025 | $106.7 | | August 3, 2024 | $127.0 | - The decrease in cash and marketable securities was primarily driven by **$38.3 million** related to share repurchases and **$14.1 million** of capital expenditures, partially offset by **$26.6 million** of cash flow from operations and the release of **$3.0 million** in restricted cash[4](index=4&type=chunk) Share Repurchase Activity (Fiscal 2025) | Period | Shares Repurchased (Millions) | Average Cost Per Share | Total Cost (Millions) | | :-------------------- | :---------------------------- | :--------------------- | :-------------------- | | Second Quarter | 0.6 | $13.10 | $7.8 | | Fiscal Year-to-Date | 2.4 | $13.64 | $32.8 | [CEO Commentary](index=1&type=section&id=CEO%20Commentary) CEO Rick Brooks expressed satisfaction with Q2 results, attributing outperformance to North American strength and successful initiatives, while maintaining a cautious outlook - Q2 results exceeded expectations, driven by outperformance in North America[5](index=5&type=chunk) - Sales trends accelerated throughout the quarter, underscoring the success of recent merchandise and customer experience initiatives[5](index=5&type=chunk) - Optimistic about prospects for the holiday season due to strong back-to-school performance, but maintaining near-term conservatism given uncertainty around tariffs and overall consumer demand[5](index=5&type=chunk) [Third Quarter To-Date Performance](index=1&type=section&id=Third%20Quarter%20To-Date%20Performance) For the first 30 days of Q3 FY25, net sales increased by 10.6%, with comparable sales up 11.2%, driven by strong North American growth Third Quarter To-Date Sales Performance (30 days ending Sept 1, 2025) | Metric | Growth Rate | | :------------------------ | :---------- | | Net Sales | +10.6% | | Comparable Sales | +11.2% | | North America Comparable Sales | +13.0% | [Fiscal 2025 Third Quarter Outlook](index=1&type=section&id=Fiscal%202025%20Third%20Quarter%20Outlook) Zumiez projects Q3 FY25 net sales between $232 million and $237 million, with comparable sales growth of 5.5% to 7.5% and diluted EPS of $0.19 to $0.29 Fiscal 2025 Third Quarter Guidance | Metric | Range | | :-------------------------- | :-------------------- | | Net Sales | $232 to $237 million | | Comparable Sales Growth | 5.5% to 7.5% | | Consolidated Operating Margins | 2.3% to 3.3% | | Earnings Per Diluted Share | $0.19 to $0.29 | [Store Expansion Plans](index=1&type=section&id=Store%20Expansion%20Plans) The company plans to open approximately 6 new stores in fiscal 2025, primarily in North America and one in Australia - Zumiez intends to open approximately **6 new stores** in fiscal 2025, including up to **5 in North America** and **1 in Australia**[8](index=8&type=chunk) [Company Information](index=2&type=section&id=Company%20Information) This section provides details on accessing the conference call, an overview of Zumiez Inc., and a safe harbor statement regarding forward-looking information [Conference Call Details](index=2&type=section&id=Conference%20Call%20Details) Information is provided for accessing the conference call via pre-registration or live webcast, with a replay also available online - Participants can pre-register for the conference call or access a live webcast at https://ir.zumiez.com[9](index=9&type=chunk) - A replay of the webcast will be available for a limited time at https://ir.zumiez.com[9](index=9&type=chunk) [About Zumiez Inc.](index=2&type=section&id=About%20Zumiez%20Inc.) Zumiez Inc. is a specialty retailer focusing on apparel, footwear, accessories, and hardgoods for young men and women, operating 730 stores globally - Zumiez is a leading specialty retailer for young men and women, expressing individuality through action sports, streetwear, and unique lifestyles[10](index=10&type=chunk) - As of August 30, 2025, the company operated **730 stores** globally: **570 in the United States**, **46 in Canada**, **86 in Europe**, and **28 in Australia**[10](index=10&type=chunk) - The company operates under the names Zumiez, Blue Tomato, and Fast Times, with corresponding e-commerce websites[10](index=10&type=chunk) [Safe Harbor Statement](index=2&type=section&id=Safe%20Harbor%20Statement) This disclaimer indicates that forward-looking statements are subject to risks and uncertainties, and the company does not undertake to update them - Statements regarding future financial performance, brand diversity, product mix, acquisitions, customer demand, and new store openings are forward-looking[11](index=11&type=chunk) - Forward-looking statements involve risks and uncertainties, and actual results could differ materially from expectations[11](index=11&type=chunk) - The company undertakes no obligation to publicly update forward-looking statements to reflect subsequent events or circumstances[11](index=11&type=chunk) [Condensed Consolidated Financial Statements](index=2&type=section&id=Condensed%20Consolidated%20Financial%20Statements) This section presents the company's condensed consolidated statements of loss, balance sheets, and cash flows for the reported periods [Condensed Consolidated Statements of Loss](index=2&type=section&id=Condensed%20Consolidated%20Statements%20of%20Loss) The statements of loss show a net loss for both the three and six months ended August 2, 2025, impacted by selling, general, and administrative expenses Condensed Consolidated Statements of Loss (Q2 and Six Months Ended August 2, 2025, Amounts in thousands) | Metric | Three Months Ended Aug 2, 2025 | Three Months Ended Aug 3, 2024 | Six Months Ended Aug 2, 2025 | Six Months Ended Aug 3, 2024 | | :----------------------------------- | :----------------------------- | :----------------------------- | :--------------------------- | :--------------------------- | | Net sales | $214,275 | $210,179 | $398,618 | $387,567 | | Gross profit | $76,018 | $71,794 | $131,333 | $123,693 | | Selling, general and administrative expenses | $75,911 | $72,187 | $151,098 | $144,240 | | Operating profit (loss) | $107 | $(393) | $(19,765) | $(20,547) | | Net loss | $(1,002) | $(847) | $(15,333) | $(17,627) | | Basic loss per share | $(0.06) | $(0.04) | $(0.88) | $(0.91) | | Diluted loss per share | $(0.06) | $(0.04) | $(0.88) | $(0.91) | [Condensed Consolidated Balance Sheets](index=3&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) The balance sheet as of August 2, 2025, indicates a decrease in total assets and shareholders' equity, with a decline in cash and marketable securities Condensed Consolidated Balance Sheet Highlights (Amounts in thousands) | Metric | August 2, 2025 | February 1, 2025 | August 3, 2024 | | :-------------------------- | :------------- | :--------------- | :------------- | | Cash and cash equivalents | $78,804 | $112,668 | $65,766 | | Marketable securities | $27,936 | $34,890 | $61,194 | | Inventories | $157,722 | $146,648 | $158,753 | | Total current assets | $300,762 | $322,385 | $326,781 | | Total assets | $623,388 | $634,881 | $669,527 | | Total current liabilities | $171,009 | $155,514 | $180,764 | | Total liabilities | $330,951 | $305,904 | $349,723 | | Total shareholders' equity | $292,437 | $328,977 | $319,804 | [Condensed Consolidated Statements of Cash Flows](index=4&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) For the six months ended August 2, 2025, Zumiez reported net cash used in operating activities, with significant cash used in financing activities Condensed Consolidated Statements of Cash Flows (Six Months Ended, Amounts in thousands) | Cash Flow Activity | August 2, 2025 | August 3, 2024 | | :----------------------------------- | :--------------------------- | :--------------------------- | | Net cash used in operating activities | $(9,501) | $(15,422) | | Net cash provided by investing activities | $3,520 | $15,912 | | Net cash used in financing activities | $(32,497) | $(19,354) | | Net decrease in cash, cash equivalents, and restricted cash | $(36,864) | $(19,077) | - Repurchase of common stock, including taxes, amounted to **$32.682 million** for the six months ended August 2, 2025[19](index=19&type=chunk) [Contact Information](index=5&type=section&id=Contact%20Information) This section provides contact details for Zumiez Inc.'s finance and investor relations departments [Company and Investor Contacts](index=5&type=section&id=Company%20and%20Investor%20Contacts) Contact details are provided for Zumiez Inc.'s Director of Finance & Investor Relations and for investor inquiries through ICR - Company Contact: Darin White, Director of Finance & Investor Relations, Zumiez Inc. (425) 551-1500, ext. 1337[20](index=20&type=chunk) - Investor Contact: Brendon Frey, ICR (203) 682-8200[20](index=20&type=chunk)

Core Insights - Zumiez Inc. reported a 1.9% increase in net sales for Q2 2025, reaching $214.3 million compared to $210.2 million in Q2 2024, with comparable sales up 2.5% on top of a 3.6% increase in the previous year [2][3] - The company experienced a net loss of $1.0 million, or $0.06 per share, in Q2 2025, compared to a net loss of $0.8 million, or $0.04 per share, in Q2 2024 [2] - For the first six months of fiscal 2025, net sales increased 2.9% to $398.6 million, with a net loss of $15.3 million, or $0.88 per share, an improvement from a net loss of $17.6 million, or $0.91 per share, in the same period last year [3][4] Financial Performance - Gross profit for Q2 2025 was $76.0 million, representing a gross margin of 35.5%, compared to a gross profit of $71.8 million and a margin of 34.2% in Q2 2024 [15] - Total liabilities decreased to $330.9 million as of August 2, 2025, from $349.7 million a year earlier, while total assets were reported at $623.4 million [18][19] - The company had cash and current marketable securities of $106.7 million as of August 2, 2025, down from $127.0 million a year prior, primarily due to share repurchases and capital expenditures [4] Sales Trends - North American comparable sales increased by 4.2% in Q2 2025, with a notable acceleration in sales trends leading to an 11.2% increase in comparable sales for the third quarter to date [1][6] - The company anticipates net sales for Q3 2025 to be between $232 million and $237 million, with expected comparable sales growth of 5.5% to 7.5% [7] Strategic Initiatives - Zumiez plans to open approximately 6 new stores in fiscal 2025, including 5 in North America and 1 in Australia, as part of its growth strategy [8] - The CEO expressed optimism about the upcoming holiday season, citing strong back-to-school performance and the success of recent merchandise and customer experience initiatives [5]