February 2026 fashion industry financial roundup: Tariff headwinds, resilient luxury and a polarising consumer landscape
A sector navigating divergent fortunes
The February reporting season painted a picture of an industry pulled in opposing directions. On one side, sportswear brands and off-price retailers continued to post strong growth; on the other, heritage luxury houses and mid-market players faced persistent softness in consumer demand. Tariff-related cost pressures, particularly in the US, emerged as a defining theme, while resale platforms and value-oriented channels gained further traction with cost-conscious shoppers.
Industry-level data confirms subdued demand
According to the French Fashion Institute (IFM), France's apparel market declined 1.6% in sales value in 2025, with the overall market still sitting 7% below its 2019 level of 37 billion euros. Physical retail fell 2.7%, while e-commerce grew 1.2%, remaining 12.4% above pre-pandemic levels. The average purchase price settled at 22 euros. In the UK, early 2026 saw five notable retail administrations, including Quiz, Claire's, The Original Factory Shop, Russell & Bromley and LK Bennett, underscoring the strain from rising operating costs and cautious consumer spending. Ultra-fast fashion platforms such as Shein, Temu and AliExpress now account for 6% of purchase volumes in France, while second-hand fashion represents 17% of online purchases.
Tariffs reshape margins across the value chain
The most pervasive financial theme of the period was the escalating impact of US tariffs on fashion companies. German sportswear group Adidas flagged a potential 400 million euro hit to operating profit from tariff-related costs, even as its brand sales rose 13% on a currency-neutral basis to 24.8 billion euros. US footwear firm Weyco Group paid 16 million dollars in incremental tariffs in 2025, contributing to a 24% drop in full-year net earnings to 23.10 million dollars. American Eagle Outfitters (AEO) cited a 50 million dollar tariff headwind in its fourth quarter alone, though total quarterly revenue still climbed 10% to 1.80 billion dollars. US footwear company Steve Madden reported full-year revenue of 2.53 billion dollars, up 11%, yet net income fell sharply to 44.7 million dollars from 169.4 million dollars a year earlier, partly due to acquisition costs and tariff exposure.
These pressures are prompting companies to accelerate supply chain diversification and pricing adjustments, with several executives signalling further price increases for the second half of 2026.
Sportswear and off-price retail outperform
Athletic and performance brands delivered some of the strongest results of the month. US running brand Brooks Running reported global revenue growth of 16% year-over-year (YoY), with notable expansion in China at 245%. Swedish sports fashion group Björn Borg achieved record profitability, with full-year operating profit rising 9.5% and its sports apparel segment growing 24%. Swiss sportswear company On opened a new factory for its proprietary 'LightSpray' technology, signalling confidence in scaling advanced manufacturing.
Off-price retailer TJX Companies posted full-year net sales of 60.4 billion dollars, up 7%, with earnings per share increasing 14%. The company's outperformance reflects a broader consumer shift toward value, a trend further evidenced by the growth of resale platforms. French resale marketplace Vestiaire Collective is on track for its first annual profit in 2026, with gross merchandise value approaching one billion euros.
Luxury divided: Hermès holds, Kering contracts
The luxury segment displayed a clear split. French luxury house Hermès reported full-year sales of 16 billion euros, up 5.5%, with leather goods exceeding seven billion euros. By contrast, French luxury group Kering saw full-year turnover decline 13% to 14.7 billion euros, with recurring operating income falling 33%. Gucci, its largest brand, experienced a 19% sales decline on a comparable basis. US luxury group Tapestry offered a counterpoint, posting second-quarter revenue of 2.50 billion dollars, up 14%, driven by a 25% surge at Coach.
Canadian outerwear brand Canada Goose delivered third-quarter sales growth of 14.2%, while US luxury brand Ralph Lauren recorded a 12% revenue increase to 2.4 billion dollars.
Challenges and opportunities ahead
The outlook for the remainder of 2026 is marked by uncertainty. Tariff escalation remains the most significant downside risk for companies with US-bound supply chains, particularly those sourcing from China and Southeast Asia. Meanwhile, the French market is projected to contract a further 0.5% in 2026, and UK retail remains under pressure from elevated costs.
Opportunities lie in three areas. The resale market, projected to reach 360 billion dollars by 2030, offers a growing revenue stream for brands willing to participate directly. India's 2026-27 textile roadmap, including mega textile parks and technical textiles, opens new sourcing possibilities. Digital and AI-driven demand planning is also gaining ground; according to the NuORDER Retail Insights Report 2025, 68% of senior retail leaders now rely on quantitative data as their primary forecasting tool.
Looking forward
February's earnings season confirmed that the fashion industry's recovery from the pandemic era remains uneven and increasingly shaped by geopolitical factors. Companies with diversified supply chains, strong brand equity and disciplined pricing strategies are best positioned to navigate the months ahead.
Company financial results summary
Adidas (Germany) — FY 2025 brand sales of 24.8 billion euros, up 13% currency-neutral. Operating profit approximately 2.1 billion euros. Flagged 400 million euro tariff impact on profit.
American Eagle Outfitters (US) — Q4 FY2025 revenue of 1.80 billion dollars, up 10%. Comparable sales up 8%. Aerie brand like-for-like (LFL) sales up 23%. FY2025 net revenue of 5.50 billion dollars, up 3%.
BasicNet (Italy) — FY 2025 consolidated turnover of 415.8 million euros, up 1.6%. Aggregate sales of 1.29 billion euros, up 4%. EBITDA of 54.1 million euros, down from 61.1 million euros. EBIT of 31.8 million euros, down from 42.1 million euros.
Björn Borg (Sweden) — FY 2025 net sales of 1,043.9 million Swedish kronor, up 5.5%. Operating profit up 9.5%. Profit after tax up 26.7%. Sports apparel segment up 24%.
Brooks Running (US) — FY 2025 global revenue up 16% YoY. North America up 14%, EMEA up 22%, APLA up 66%. China growth of 245%.
C&A (Brazil operations) — Q4 2025 net profit of 313.2 million Brazilian real, up 22.9%. FY 2025 net profit of 587.1 million Brazilian real, up 29.7%. Revenue of 7.98 billion Brazilian real, up 4.5%.
Calida Group (Switzerland) — FY 2025 sales of 215.9 million Swiss francs, down 6.6%. Operating profit of nine million Swiss francs, up from four million. Net profit of 7.6 million Swiss francs, up from 0.5 million.
Canada Goose (Canada) — Q3 FY2025/26 sales of 694.5 million Canadian dollars, up 14.2%. Direct-to-consumer up 14.1%. North America up 20%.
Crocs Inc. (US) — FY 2025 total revenue exceeding four billion dollars, down 1.5%. Crocs brand international revenues of 1.62 billion dollars, up 11.9%. HeyDude revenues of 715 million dollars, down 13.3%. Impairment charges of 737 million dollars.
EssilorLuxottica (France) — FY 2025 annual revenue of 28.49 billion euros, up 7.5%. Net profit of 2.32 billion euros, down 1.9%. Adjusted operating margin of 16.0%.
Francesca's (US) — Filed Chapter 11 bankruptcy. Assets of ten to 50 million dollars, liabilities of 50 to 100 million dollars.
Hermès (France) — FY 2025 sales of 16 billion euros, up 5.5%. Net profit of 4.5 billion euros, down 1.72%. Leather goods exceeded seven billion euros, up 9.5%.
Kering (France) — FY 2025 turnover of 14.7 billion euros, down 13%. Recurring operating income of 1.6 billion euros, down 33%. Gucci sales down 19% on a comparable basis. Net income of 532 million euros, down approximately 50%.
LuxExperience/Mytheresa (Germany) — Q2 FY2025/26 Mytheresa revenue of 242.70 million euros, up 8.8%. Group sales with Yoox Net-a-Porter (YNAP) of 646.90 million euros.
Marimekko (Finland) — FY 2025 sales of 189.6 million euros, up 4%. Operating result of 31.8 million euros, up from 31.4 million euros. Net profit of 24.4 million euros, unchanged.
Perfect Moment (UK) — Q3 FY2026 revenue of 11.70 million dollars. First profitable quarter with net income of 93,000 dollars. Nine-month revenue of 17.90 million dollars, up 8.7%.
Ralph Lauren (US) — Q3 FY2025/26 revenue of 2.4 billion dollars, up 12%. Adjusted gross margin of 69.9%. Adjusted operating margin of 19.6%.
Spinnova (Finland) — FY 2025 revenue of 344,000 euros, down 54%. Operating loss of 41.3 million euros, widened from 18.3 million euros.
Steve Madden (US) — FY 2025 revenue of 2.53 billion dollars, up 11%. Net income of 44.7 million dollars, down from 169.4 million dollars.
Tapestry Inc. (US) — Q2 FY2025/26 revenue of 2.50 billion dollars, up 14%. Coach revenue of 2.14 billion dollars, up 25%. Net profit up 81% to 561.3 million dollars.
TJX Companies (US) — FY 2025 net sales of 60.4 billion dollars, up 7%. Net income of 5.5 billion dollars. Earnings per share of 4.87 dollars, up 14%.
Urban Outfitters (US) — FY 2025 net sales of 6.17 billion dollars, up 11.1%. Nuuly segment net sales up 42.6%.
Vestiaire Collective (France) — 2024 gross merchandise value approaching one billion euros. Revenue of 200 million euros. Gross margin exceeding 50%. Targeting profitability in 2026.
Weyco Group (US) — FY 2025 net sales of 276.20 million dollars, down 5%. Net earnings of 23.10 million dollars, down 24%. Paid 16 million dollars in incremental tariffs.
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