Shares of Genesco climbed nearly 8 percent in pre-market trading on Friday after a better-than-expected start to the year.
The Nashville-based footwear company reported on Friday a net loss of $14.81 million, or $1.42 per diluted share, in the first quarter of fiscal 2027, compared to a loss of $21.23 million, or $2.02, in Q1 2026. Net sales increased 3 percent to $487.03 million compared to $473.97 million in the same year-ago period.
This performance beat analysts’ expectations, which called for net sales in Q1 to be between $467.56 million and $480 million with a loss per share between $2.47 and $2.62, according to Yahoo Finance.
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Genesco noted that the sales increase in Q1 reflects a 2 percent bump in comparable sales, including a 3 percent rise in same-store sales, other non-comp gains and a favorable foreign exchange impact, partially offset by the impact of net store closings.
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The company further reported that the overall sales growth for the first quarter was driven by an increase of 5 percent at Journeys, an increase of 6 percent at Johnston & Murphy and a 4 percent increase at Genesco Brands, partially offset by a decrease of 5 percent at Schuh.
During the quarter, the company opened two stores and closed 30 stores. The company ended the quarter with 1,208 stores compared with 1,256 stores at the end of the first quarter last year, or a decrease of 4 percent. Square footage was also down 4 percent on a year-over-year basis.
Genesco disclosed that it expects tariff refunds under the International Emergency Economic Powers Act of approximately $23 million to $25 million related to its branded businesses.
The company also announced a new cost reduction program, which is expected to generate cost savings of $40 million to $50 million between now and fiscal 2029. Genesco said that this latest program is aimed at “structurally reducing the cost base, continued investment in growth initiatives, further supporting operating margin expansion and continued utilization of AI capabilities which unlock additional opportunities.”
Genesco president, chief executive officer, board chair and interim chief financial officer, Mimi Vaughn said in a statement on Friday that after a strong finish to fiscal 2026, the company delivered its seventh consecutive quarter of positive comparable sales and first quarter results that “exceeded expectations” across the board.
“The execution of our strategic initiatives continues to translate into tangible results,” Vaughn said. “Journeys’ comparable sales grew mid-single-digits on top of a high-single-digit gain last year, as our work around product elevation and customer experience continues to drive market share gains. At the same time, Johnston & Murphy’s comparable sales accelerated sharply, increasing high-single-digits, while Schuh’s comparable sales performance reflects our decision to pull back on promotions and prioritize a more full-price selling model.”
Looking ahead, Genesco is raising its expectations for adjusted diluted earnings per share from continuing operations to a range of $2.00 to $2.40, with the middle of the range the most likely outcome, as a result of the better-than-expected start to fiscal 2027. The previous range was expected between $1.90 and $2.30 per share.
The company continues to expect total sales to be down 1 percent to flat compared to fiscal 2026, reflecting the impact of store closures and license exits.
“We have clear plans in place to drive continued improvement in fiscal 2027,” the CEO added. “Our top-line guidance reflects another year of overall positive comparable sales growth, offset by store closures and license transitions in our branded footwear group.”