Zumiez Inc.

What they do

Zumiez sells apparel, footwear, accessories and hardgoods tied to action sports, streetwear and other youth lifestyles, primarily to teenagers and young adults. At August 29, 2026 it operated 714 stores: 561 in the U.S., 45 in Canada, 81 in Europe and 27 in Australia, plus ecommerce sites zumiez.com, zumiez.ca, blue-tomato.com and fasttimes.com.au. Merchandise mixes third-party lifestyle brands with a private label offering, and the company integrates store and ecommerce channels through in-store fulfillment of online orders in North America.

Revenue drivers

• North America stores and ecommerce — 561 U.S. stores plus 45 in Canada; described in the fiscal 2025 10-K as the primary driver of sales growth, with eight consecutive quarters of positive comparable sales and product margin growth.
• Private label brands — In fiscal 2025 private label exceeded 30% of total revenue, a new fiscal-year record, and was cited as a strategic focus behind favorable results.
• Hardgoods — Skateboards, snowboards, bindings, components and equipment; the category had been negative for several years but returned to positive growth in the second quarter of fiscal 2025 and held that through year-end.
• Europe (Blue Tomato) — 85 stores in Europe at January 31, 2026; fiscal 2025 efforts shifted toward full-price selling with reduced promotions, lifting product margins over 250 basis points year-over-year despite lower overall sales.

Recent performance

Second quarter fiscal 2026 net sales fell 2.5% to $209.0 million from $214.3 million, with comparable sales down 2.1% and a net loss of $2.7 million, or $0.17 per share. First-half fiscal 2026 sales rose 0.9% to $402.3 million with comparable sales up 0.7%, but the net loss widened to $16.0 million ($1.00 per share) from $15.3 million ($0.88) a year earlier. CEO Rick Brooks attributed the second-quarter shortfall to weaker U.S. performance, continued footwear softness and lower traffic, partly offset by growth in other regions. Third quarter-to-date net sales through September 7, 2026 declined 4.3% with comparable sales down 3.5%. Full fiscal 2025 revenue was $929.1 million with net income of $13.4 million and diluted EPS of $0.78.

Strategy

Management is focused on private label expansion, which passed 30% of revenue in fiscal 2025, and on keeping the merchandising mix fresh, having launched well over 150 new brands that year. It is directing Europe toward full-price selling and improved assortments, and continuing to ship North American online orders from stores to combine digital and physical inventory into one cost structure. The company is also closing underperforming locations, shutting 17 stores in fiscal 2025 and planning roughly 16 closures in fiscal 2026, while intending to open about 5 new North American stores. It returned capital through buybacks, repurchasing 2.7 million shares for $38.3 million in fiscal 2025 and 1.5 million shares for $29.5 million fiscal year-to-date through August 1, 2026.

Risks

• U.S. traffic and footwear weakness — Second quarter fiscal 2026 results fell below last year on weaker U.S. performance, continued footwear softness and lower traffic levels.
• Tariffs and global trade policy — The 10-K cites U.S. tariffs imposed or threatened on Canada, Mexico and other countries and any retaliatory actions as factors that could impact profitability.
• Discretionary spending cyclicality — The 10-K states retail demand is subject to substantial cyclicality and that reduced consumer confidence can cut purchases of apparel and related products.
• International sales pressure — Fiscal 2025 European product margins improved over 250 basis points, but the shift to full-price selling contributed to negative fourth-quarter sales trends in the region.

Outlook

For the third quarter ending October 31, 2026, Zumiez guides net sales of $222 to $226 million and earnings per share of $0.00 to $0.10. Third quarter-to-date net sales through September 7, 2026 were down 4.3% and comparable sales down 3.5%, and management said the back-to-school trend resembled the second quarter, with the U.S. its toughest market after two years of low double-digit comparable sales growth in the same periods. Management said it is refining merchandise assortments and deepening customer experience initiatives ahead of the holiday season. Store plans for fiscal 2026 are roughly 5 openings, all in North America, and about 16 closures, including 10 in North America and 6 internationally.