Core Viewpoint - A class action has been filed against Bath & Body Works, Inc. for allegedly misleading investors regarding its business strategy and financial performance [1][2]. Allegations - The complaint alleges that Bath & Body Works did not disclose that its strategy of pursuing "adjacencies, collaborations and promotions" was failing to grow the customer base and was not delivering the expected growth in net sales [2]. - It is claimed that the company relied on brand collaborations to mask weak financial results as its strategy faltered [2]. - The company is accused of being unlikely to meet its previously issued financial guidance due to these issues [2]. Financial Performance - On November 20, 2025, Bath & Body Works reported disappointing third quarter results, with revenue declining by 1% year over year, missing the guidance of 1-3% growth [3]. - Net income fell by 26% to $77 million, and the company reduced its full-year guidance for net sales and earnings per diluted share from $3.28 to "at least $2.83" [3]. - The company acknowledged that its previous strategy had not grown the total customer base and admitted to an over-reliance on promotions to drive growth [3]. Stock Market Reaction - Following the announcement of the disappointing results and new business strategy, Bath & Body Works' stock price dropped by $5.22, or 24.8%, closing at $15.82 per share on November 20, 2025 [4]. Class Action Participation - Shareholders may be eligible to participate in the class action against Bath & Body Works, with a deadline for lead plaintiff submissions set for March 16, 2026 [4].

Core Insights - The retailer has revised its profit forecast downward due to a decline in both sales and earnings [1] Group 1 - The company experienced a drop in sales, which has directly impacted its earnings [1] - As a result of the sales decline, the company has adjusted its profit outlook for the upcoming period [1]