US' Dillard's FY25 earnings dip despite stable sales performance

Retail gross margin for the year stood at 40.8 per cent of sales compared with 41 per cent in FY24, while consolidated gross margin held steady at 39.5 per cent. Operating expenses increased to $1.759 billion, representing 27.2 per cent of sales, up from $1.731 billion, or 26.7 per cent, in the prior year. Inventory levels at year-end rose 2 per cent, Dillard's said in a press release.

Commenting on performance, William T Dillard II, chief executive officer at Dillard’s, said: “We reported a respectable year. We achieved retail gross margin of 40.8 per cent in a rapidly changing merchandising environment with unpredictable costs. We rewarded our shareholders with the largest dividend in our history and still held around $1.1 billion in cash and short-term investments at year-end.”

Meanwhile, in the fourth quarter (Q4), Dillard’s reported net income of $203.7 million, or $13.05 per share, compared with $214.4 million, or $13.48 per share, in the corresponding period last year. Quarterly net sales declined to $1.962 billion from $2.017 billion.

Total retail sales for the quarter decreased 1 per cent to $1.916 billion, while comparable store sales also fell 1 per cent. The company noted that sales at more than one-third of its stores were disrupted by a winter storm during the third weekend of January 2026.

Category performance during the quarter showed moderate gains in ladies’ accessories and lingerie, while shoes remained stable. Moderate declines were recorded in ladies’ apparel, cosmetics, men’s apparel and accessories, juniors’ and children’s apparel, and home and furniture.

Consolidated gross margin for the quarter improved to 35.4 per cent from 34.9 per cent, while retail gross margin held steady at 36.1 per cent. Operating expenses increased to $463 million, or 23.6 per cent of sales, compared with $452 million, or 22.4 per cent, primarily due to higher payroll and related costs.

Dillard’s ended the year with a strong liquidity position, maintaining approximately $1.1 billion in cash and short-term investments while continuing shareholder returns through record dividend payouts, underscoring its stable financial footing despite a volatile retail operating environment.

Fibre2Fashion News Desk (SG)