Interparfums Q4 Earnings Top Estimates, Organic Sales Increase 3%

Core Insights - Interparfums, Inc. (IPAR) achieved record fourth-quarter 2025 results with both revenue and earnings increasing year over year, surpassing the Zacks Consensus Estimate [1][5] Financial Performance - Quarterly earnings reached 88 cents per share, a 16% increase from 75 cents in the prior-year period, exceeding the Zacks Consensus Estimate of 78 cents [5][10] - Consolidated net sales rose 7% to $386.2 million from $361.5 million in the same quarter last year, with organic sales increasing by 3% [5][10] - European operations saw net sales grow by 9% to $233 million, while U.S. operations increased by 4% to $155 million, driven by brands like GUESS and Roberto Cavalli [6] Operational Highlights - The top seven brands, which account for approximately 77% of total sales, demonstrated healthy growth, particularly from Jimmy Choo, Coach, Lacoste, and Roberto Cavalli [3] - Travel Retail continued to outperform overall company growth, indicating strong demand in that segment [3] Cost and Margin Analysis - Consolidated gross margin decreased to 61.5%, down 300 basis points from 64.5% in the prior year, primarily due to tariff-related cost pressures [7] - Selling, general, and administrative expenses rose to $209.8 million from $193 million last year, while operating income fell 24% to $27.5 million, leading to a contraction in operating margin by 280 basis points to 7.1% [7] Financial Health - At the end of 2025, Interparfums had $295.2 million in cash, cash equivalents, and short-term investments, with inventories declining by 6% year over year [8] - Long-term debt, excluding the current portion, was approximately $121.3 million, and the company reaffirmed its annual cash dividend at $3.20 per share for 2026 [8] Future Outlook - Interparfums reaffirmed its 2026 guidance, projecting net sales of $1.48 billion and earnings per share of $4.85, considering current exchange rates and the anticipated full-year impact of tariffs [11]