Bath & Body Works’ second-quarter sales were ‘soft’, with uneven growth across its sales channels, and a decline online.

The company’s net sales were $1.5 billion, up by a modest 1.5 per cent year over year. 

“We delivered solid results in Q2, while focusing, with urgency, on our three no-regret moves to elevate our digital experience, amplify our product efficacy, and expand distribution to meet consumers where they are,” said Daniel Heaf, CEO of Bath & Body Works.

By region, sales in North American and Canadian stores posted a robust increase of 4.9 per cent, mainly fueled by engaging merchandising and good in-store execution, including the company’s semi-annual sale.

“This is a formula that drives repeat visits and encourages both impulse buying and self-treating, which is a very important dynamic in discretionary categories,” commented Neil Saunders, MD of GlobalData.

The company’s results were further enhanced by its expansion into adjacent categories, including skincare, laundry, and pet care, as well as collaborations, such as the fragrance partnership with Disney, which made Bath & Body Works’ products more discoverable in the discretionary market.

For Bath & Body Works’ online channels, which reflected a sales decline of 10.1 per cent, the retail analyst said it comes from a range of ‘unfavourable’ factors, including increased competition in the home scent category on third-party marketplaces such as Amazon.

Saunders said that while the company is doing well in physical stores, it fails to fully translate the same dynamics to its online base.

“For example, it is far harder to stimulate engagement or to encourage impulse buying or the bundling of multiple products in a transaction,” said Saunders.

For the second quarter, the company’s adjusted operating income was $172 million, and its adjusted net income was $78 million.

“Our team delivered a solid quarter, with revenue and adjusted earnings per share at the high end of our guidance range,” said Heaf.

Based on our strong first-half results and our confidence in our outlook, we are raising the low end of our full-year adjusted earnings per share guidance range.”

For FY25, the company expects net sales to grow from 1.5 per cent to 2.7 per cent, which the analyst considered a solid outlook. 

This month, the company undertook its large-scale transformation on US college campuses, targeting the emerging Gen Z market with more than 600 campus stores.