EPS of $2.22 increased by 23.3% from previous year
Gross margin of 48.6%
Net income of 50.92M
"'The scope, severity, speed and daily changes to global trade policy are creating significant uncertainty and disruption to our business.'" - Noel Geoffroy
Helen of Troy Limited (HELE) Q4 2025 Financial Results: Navigating Turbulent Waters Amid Strategic Growth Initiatives
Executive Summary
Helen of Troy Limited reported Q4 2025 results amid increasing pressures from global trade policies and changing consumer preferences. With revenue of $485.9 million, a slight decline of 0.7% YoY, the company overcame challenges in its Beauty & Wellness segment, with strong performance noted in the Wellness and Home categories, particularly through brands like OXO and Olive & June. Management refrained from providing guidance for FY26 due to uncertainties in tariffs and consumer behavior. However, their focus on cost control and strategic diversification positions them well for navigating potential economic downturns moving forward. The consolidated net income improved to $50.9 million, highlighting the company's resilience despite a challenging environment.
Key Performance Indicators
Revenue
485.89M
QoQ: -8.44% | YoY:-0.71%
Gross Profit
235.93M
48.56% margin
QoQ: -9.02% | YoY:0.27%
Operating Income
2.02M
QoQ: -97.32% | YoY:-97.14%
Net Income
50.92M
QoQ: 2.62% | YoY:19.15%
EPS
2.22
QoQ: 2.30% | YoY:23.33%
Revenue Trend
Margin Analysis
Key Insights
**Revenue**: $485.9 million (down 0.7% YoY, down 8.4% QoQ)
**Gross Profit**: $235.9 million (46% gross margin)
**Net Income**: $50.9 million, or $2.22 EPS (up 19% YoY)
**Operating Margin**: 0.4%, a significant decline from 13.5% YoY due to asset impairment charges in the Drybar segment.
**Free Cash Flow**: Positive trend expected as management emphasizes cost savings with an aim to offset up to 80% of tariff impacts in FY26.
These metrics indicate a mixed performance with revenue under pressure but net income showing resilience against economic headwinds.
Financial Highlights
- Revenue: $485.9 million (down 0.7% YoY, down 8.4% QoQ)
- Gross Profit: $235.9 million (46% gross margin)
- Net Income: $50.9 million, or $2.22 EPS (up 19% YoY)
- Operating Margin: 0.4%, a significant decline from 13.5% YoY due to asset impairment charges in the Drybar segment.
- Free Cash Flow: Positive trend expected as management emphasizes cost savings with an aim to offset up to 80% of tariff impacts in FY26.
These metrics indicate a mixed performance with revenue under pressure but net income showing resilience against economic headwinds.
Income Statement
Metric
Value
YoY Change
QoQ Change
Revenue
485.89M
-0.71%
-8.44%
Gross Profit
235.93M
0.27%
-9.02%
Operating Income
2.02M
-97.14%
-97.32%
Net Income
50.92M
19.15%
2.62%
EPS
2.22
23.33%
2.30%
Key Financial Ratios
currentRatio
2
grossProfitMargin
48.6%
operatingProfitMargin
0.42%
netProfitMargin
10.5%
returnOnAssets
1.63%
returnOnEquity
3.02%
debtEquityRatio
0.57
operatingCashFlowPerShare
$1.53
freeCashFlowPerShare
$1.18
priceToBookRatio
0.75
priceEarningsRatio
6.18
Net Income vs. Revenue
Expense Breakdown
Management Commentary
- Strategic Focus: CEO Noel Geoffroy emphasized the importance of diversifying the supply chain away from China, reflecting ongoing global trade volatility. 'We accelerated our multi-year risk mitigation plan to further diversify our supply chain outside of China.'
- Consumer Insights: The management highlighted a shift in consumer behavior towards value-driven purchases, stating, 'Many of our brands resonate well during economic downturns as they offer value to consumers who are looking to stretch their budgets.'
- Investment in Growth: CFO Brian Grass revealed plans to offset tariff impacts through proactive measures, saying, 'With these actions and the tariff mitigation strategies referred to earlier, we believe we can offset 70% to 80% of the tariff impact in fiscal '26.'
'The scope, severity, speed and daily changes to global trade policy are creating significant uncertainty and disruption to our business.'
— Noel Geoffroy
'We are focused on controlling our controllables while continuing to monitor the landscape closely.'
— Noel Geoffroy
Forward Guidance
Management has chosen not to provide explicit financial guidance for FY26 amidst evolving economic conditions and the impacts of potential tariffs. They acknowledged future consumer demand softness and the need for possible price increases, stating, 'We believe we can over-index towards goods produced in the US or in lower tariff geographies.' Significant efforts are underway to sort through existing inventory and adjust supply chain strategies to manage expected tariff implications effectively. Investors should monitor industry conditions closely as developments may impact the company’s operational and financial security.
Competitive Position
Company
Gross Margin
Operating Margin
Return on Equity
P/E Ratio
HELE Focus
48.56%
0.42%
3.02%
6.18%
IPAR
64.50%
11.10%
3.25%
43.50%
JJSF
31.80%
9.34%
3.10%
27.94%
HIBB
35.20%
11.10%
10.20%
5.50%
LANC
21.60%
9.21%
3.76%
37.15%
Gross Profit Margin
Operating Profit Margin
Return on Equity
P/E Ratio Comparison
Investment Outlook
Despite the current uncertainty, Helen of Troy Limited is positioned for long-term growth, leveraging its strong brand portfolio and diversification strategies. The positive revenue trends in the Wellness segment and the successful integration of Olive & June provide a solid roadmap for future profitability. However, investor sentiment may be tempered by current geopolitical risks and consumer spending trends. Continued focus on cash flow management and cost-control measures will be critical as the economic landscape evolves.
Key Investment Factors
Growth Potential
Helen of Troy's established brands like OXO and Olive & June present significant growth opportunities, particularly in markets sensitive to pricing and value, especially during economic downturns.
Profitability Risk
Risks include heightened tariff impacts due to global trade tensions, potential declines in consumer spending amidst macroeconomic pressures, and reliance on international sales channels, especially in China.
Financial Position
The financial position remains solid with a total debt of $917 million and a net leverage ratio approaching three times, but the company is focused on maintaining liquidity and cash flow amid uncertainty.
SWOT Analysis
Strengths
Strong brand recognition with leadership positions in multiple categories.
Diverse product offerings in key segments: Home, Beauty, and Wellness.
Proactive management in mitigating tariff impacts and supply chain diversification.
Weaknesses
Fluctuating gross margins due to less favorable product mix and increased costs from supply chain adjustments.
Recent profitability challenges evidenced by low operating margins.
Opportunities
Growing demand for value-priced consumer products amidst economic uncertainty.
Expansion in international markets not impacted by tariffs.
Threats
Global trade tensions and changing tariffs that could adversely impact costs.
Potential decline in consumer spending affecting discretionary purchases.