Shares of Canada Goose Holdings (GOOS) tumbled 6.43% in pre-market trading on Thursday following the release of its fiscal second-quarter results that fell short of analysts' expectations, raising concerns about the luxury apparel maker's performance amid challenging market conditions.
The Toronto-based company reported revenue of C$272.6 million for the quarter ended September 28, representing a modest 1.8% increase year-over-year. However, this figure missed the consensus estimate of C$279.3 million, according to data compiled by LSEG. The revenue shortfall suggests that Canada Goose's growth trajectory may be decelerating, despite its efforts to strengthen marketing and promotional strategies.
Adding to investors' concerns, Canada Goose posted a net loss of C$15.2 million for the quarter, compared to a net income in the same period last year. This swing to a loss indicates potential pressure on the company's profitability and operational efficiency. The adjusted earnings per share came in at -C$0.14, although a direct comparison to analysts' expectations was not provided.
While the company highlighted a 21.8% increase in Direct-to-Consumer (DTC) revenue, driven by improved execution, in-season product newness, and consistent marketing, it appears that this growth was not sufficient to offset weaknesses in other segments. The disappointing overall performance suggests that Canada Goose may be facing headwinds in its wholesale business or international markets.
Notably, Canada Goose did not provide specific financial guidance for future periods, which may have contributed to the negative market reaction. The lack of forward-looking projections could be interpreted as a sign of uncertainty regarding the company's near-term prospects in the face of ongoing economic challenges and shifting consumer behaviors.
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