Vince Holding Corp. Reports $4.8 Million Net Loss and Decline in Sales for Latest Quarter

Vince Holding Corp. reported a net loss of $4.8 million for the three months ended May 3, 2025, compared to a net income of $4.4 million during the same period in the previous year. This shift in profitability was accompanied by a 2.1% decline in net sales, which totaled $57.9 million, down from $59.2 million in the prior year. The company's gross profit also decreased by 2.5% to $29.2 million, resulting in a gross margin of 50.3%, slightly lower than the 50.6% margin reported in the previous year. The decline in gross margin was attributed to increased freight and duty costs, a shift in wholesale channel mix, and higher distribution costs, although these were partially offset by lower product costs and reduced promotional activity.

In terms of operational changes, Vince Holding Corp. has undergone significant strategic developments, including the sale of its intellectual property assets related to the Vince brand to Authentic Brands Group, LLC (ABG) for $76.5 million in cash and a 25% membership interest in ABG. This transaction, completed on May 25, 2023, was part of a broader strategy to streamline operations and focus on the core Vince brand. Additionally, the company has seen a change in ownership structure, with P180 Vince Acquisition Co. acquiring a majority stake in the company on January 22, 2025, from affiliates of Sun Capital Partners, Inc.

The company operates through two reportable segments: Vince Wholesale and Vince Direct-to-Consumer. For the three months ended May 3, 2025, the Vince Wholesale segment reported net sales of $30.3 million, a slight increase from the previous year, while the Direct-to-Consumer segment saw a decline in sales to $27.6 million, down from $28.9 million. The total number of retail locations has decreased to 58, comprising 44 full-price stores and 14 outlet stores, reflecting a strategic decision to close underperforming locations.

Vince Holding Corp. has also faced challenges in managing its operating expenses, with selling, general, and administrative expenses rising to $33.6 million, up 5.2% from the prior year. This increase was driven by higher marketing, legal, and IT costs. The company’s liquidity position remains a concern, as it reported net cash used in operating activities of $11.8 million for the quarter, primarily due to a decrease in accounts payable and an increase in inventories. As of May 3, 2025, the company had $2.6 million in cash and cash equivalents, alongside $34.7 million in long-term debt.

Looking ahead, Vince Holding Corp. anticipates continued fluctuations in financial performance due to macroeconomic factors and changing consumer behaviors. The company is focused on executing its strategic initiatives, including enhancing its e-commerce capabilities and optimizing its retail footprint. However, management has acknowledged the potential impact of tariffs and trade policies on its operations, which could necessitate further adjustments to its business strategy.