Bath & Body Works Stock Reacts to Q2 Earnings Report

Bath & Body Works (BBWI) is struggling after a poor Q2 earnings report was released on Tuesday.

Written by: Timothy St. John • Wednesday, June 5, 2024 • 2 min read

• Last updated: Wednesday, June 5, 2024

Retailer Bath & Body Works (BBWI) released its second quarter earnings report for the year, which showed that sales fell by 2%.

BBWI stock has fallen after the company’s earnings report.

The first quarter was much better for the retailer, where they exceeded expectations, but the second quarter has shown decline that has hurt the company’s stock price. On Tuesday after the earnings report came out, the company’s stock fell by 12.4%.

The stock price corrected slightly today, with an increase of 3.12%, but there is no mistaking that the company is hurting right now after its pessimistic quarterly report.

BBWI came in under expectations for earnings and share price, and the company anticipates that it will see a 2% decline for the coming quarter.

The company is battling with a tough retailer environment right now, where consumers are shifting toward discount outlets, like Walmart and Dollar General. Those companies are expecting to earn big this year, potentially exceeding last year’s sales as inflation stays locked high for now.

Bath & Body Works May Be in for a Rough Quarter

We are still waiting for economic data from a few corners this week, namely Final Services PMI and ISM services PMI, as well as for ADP Non-Farm Employment Change. We expect most of these to show high inflation indications, though. At the very least, we do not anticipate that they will move the inflation needle at all.

With US inflation elevated, Bath & Body Works may struggle to bring in customers and keep its retail sales up. The company has had difficulty in retaining customers during the post-covid era, losing many of them to cheaper competitors. As inflation does not look to be dropping rapidly anytime soon, we will probably see that trend continue.

This is likely not a good time to invest in BBWI, especially for short-term gains. The company may turn things around over the long term, but so far, we are not seeing guidance that points to that.

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ABOUT THE AUTHOR See More

Timothy St. John

Financial Writer - European & US Desks

Timothy St John is a seasoned financial analyst and writer, catering to the dynamic landscapes of the US and European markets. Boasting over a decade of extensive freelance writing experience, he has made significant contributions to reputable platforms such as Yahoo!Finance, business.com: Expert Business Advice, Tips, and Resources - Business.com, and numerous others. Timothy's expertise lies in in-depth research and comprehensive coverage of stock and cryptocurrency movements, coupled with a keen understanding of the economic factors influencing currency dynamics. Timothy majored in English at East Tennessee State University, and you can find him on LinkedIn.