Key Takeaways:
- Zumiez Q1 net sales rose 4.9% to $193.3 million with comparable sales up 4%, the eighth consecutive positive comp quarter, though consumer spending pressure built late in the period.
- Men’s led category performance; footwear was the only negative comp. Private label reached a record 34% of total sales.
- Zumiez expects Q2 net sales of $210 million to $215 million and refrained from providing specific full-year earnings guidance, citing an uncertain consumer environment.
Zumiez saw comparable sales momentum soften in the back half of its fiscal first quarter as consumer spending pressure intensified, even as the action sports and streetwear retailer posted its eighth consecutive quarter of positive comparable sales growth and margin improvement.
“We continue to make important progress towards sustained profitable growth,” CEO Rick Brooks said in a statement. “Sales trends in the U.S. remained nicely positive during the quarter despite increasing pressure on consumers, underscoring the success of our recent merchandise assortments and customer experience initiatives.”
Net sales for the quarter ended May 2, 2026, rose 4.9% to $193.3 million from $184.3 million in the year-ago period. Comparable sales increased 4%, with North America up 4.4% and Europe up 5.5%, according to Brooks.
But management was direct on the earnings call that the operating environment became more challenging as the quarter progressed, a trend that continued into May, when North America comparable sales turned negative.
Net loss was $13.3 million, or $0.82 per diluted share, compared to a net loss of $14.3 million, or $0.79 per share, in the prior year. The year-ago period included a $2.9 million litigation settlement that negatively impacted prior year EPS by approximately $0.13 per share.
The company ended the quarter with cash and marketable securities of $124.2 million, up from $101 million a year ago.
Category Trends, Private Label Growth
Men’s led comparable sales growth in the quarter, followed by hardgoods, women’s and accessories. Footwear was the only negative comping category.
The same general order held into the May period, with accessories moving ahead of women’s but hardgoods softening relative to the first quarter.
Private label reached 34% of total sales, the highest penetration level in company history. CFO Christopher Work said on the earnings call that the company will follow the consumer rather than target a specific ceiling, noting that private label does not play as deeply in certain parts of the mix and that in some brand-driven categories the company is not very active.
Brooks added that the cut-and-sew categories have required Zumiez to step in and own more trend product as brand cycles have accelerated, and that a footwear rebound, when it comes, could shift the overall mix without necessarily reducing private label sales in absolute terms.
Consumer Spending Pressure Building, Especially in North America
Work said the company is “taking a measured approach” to its outlook given macroeconomic pressures that built during the latter part of Q1 and continued into May.
North America comparable sales in the four-week May period declined 1.5%, while other international comparable sales rose 7.2%.
Asked by analysts on the earnings call about whether pressure is more acute in North America or Europe, Work acknowledged that macro data points to a more challenged European consumer, but said Zumiez’s stronger European results reflect operational improvements including new product, inventory discipline and full-price selling that appear to be offsetting broader headwinds in those markets.
On the North American side, Work noted the business notably slowed when the Middle East conflict escalated. Work said the company is “higher priced” with “some discretionary elements” to its offering, factors he said could create additional pressure in the current environment.
Future Outlook – No Full Year Guidance
For the fiscal second quarter ending August 1, 2026, Zumiez expects net sales of $210 million to $215 million, representing growth of negative 2% to positive 0.5% versus the prior year.
The company expects earnings per share between a loss of $0.23 and a loss of $0.08, compared to a loss of $0.06 in the prior year second quarter.
Zumiez declined to provide specific full-year earnings guidance, citing ongoing uncertainty in consumer spending. Executives said they still expects total sales growth for the year but acknowledged the back half of fiscal 2026 is now expected to come in slightly below its original March projections.
Zumiez Store Opening, Closing Plans
On the real estate front, the company plans to open five new U.S. stores and close approximately 26 locations, 20 in North America and six internationally, representing roughly $12 million in annual sales.
Work said North America closures are approaching a peak and will moderate in 2027 and beyond, while international closures will depend on whether underperforming markets can be turned around.
