Genesco Inc. Reports 3.6% Net Sales Increase and $21.2 Million Net Loss in Q1 Fiscal 2026

Genesco Inc. reported a net sales increase of 3.6% for the first quarter of Fiscal 2026, reaching $474.0 million compared to $457.6 million in the same period last year. The growth was driven by a 5% rise in comparable sales, which included a 7% increase in e-commerce sales and a 5% increase in same-store sales. The Journeys Group segment performed particularly well, with an 8% increase in comparable sales, while the Schuh Group saw a 1% increase. However, the Johnston & Murphy Group experienced a 2% decline in comparable sales. The company reported a net loss of $21.2 million, or $2.02 per diluted share, an improvement from the net loss of $24.3 million, or $2.23 per diluted share, in the prior year.

The gross margin for the quarter increased to $221.2 million, up from $216.3 million, but as a percentage of net sales, it decreased from 47.3% to 46.7%. This decline was attributed to changes in brand mix and promotional activities, particularly in the Journeys and Schuh groups. Selling and administrative expenses rose slightly to $249.0 million, but as a percentage of net sales, they decreased from 54.2% to 52.5%, reflecting cost-saving initiatives and reduced occupancy expenses. The operating loss narrowed to $28.1 million from $32.1 million in the previous year.

In terms of operational developments, Genesco operated 1,256 retail stores across the U.S., Puerto Rico, Canada, the U.K., and the Republic of Ireland as of May 3, 2025. The company closed 19 stores in the Journeys Group while opening two new locations. The Schuh Group's e-commerce business accounted for over 40% of its sales, highlighting the importance of digital channels in the current retail environment. The company also repurchased 604,531 shares of its common stock during the quarter at a cost of $12.6 million, with $29.8 million remaining under its share repurchase authorization.

Looking ahead, Genesco anticipates continued challenges in the retail environment, particularly with consumer spending patterns and macroeconomic conditions. The company plans to invest approximately $50-$65 million in capital expenditures for Fiscal 2026, focusing on new store openings and renovations. Management remains cautious about the impact of external factors such as inflation, labor shortages, and geopolitical events on future performance. The company believes that its liquidity, supported by cash flow from operations and available credit facilities, will be sufficient to meet its needs in the foreseeable future.