What happened
Apparel maker Hanesbrands (HBI -5.04%) probably wishes it had stayed warm and cozy in the underwear drawer on Wednesday. The company reported third-quarter results that not only missed on the top and bottom lines, but also came up short with guidance. Investors punished the company for these transgressions by trading its stock down nearly 9% on the day.
So what
For the quarter, Hanesbrands' net sales totaled $1.67 billion, representing a 7% decline from the same period of 2021. Adjusted net income saw a steeper fall, tumbling by almost 46% to $102 million, or $0.29 per share.
Both figures fell short of analyst expectations for $1.75 billion on the top line, and $0.30 per share for adjusted net profit.
In its earnings release, Hanesbrands attributed its declines to what it characterized as "the macro-driven slowdown in consumer spending in the U.S. and certain Asian markets coupled with the impact to orders as U.S. retailers tightly manage their overall inventory levels."
These factors mitigated growth in the company's underwear product category in Australia and what it calls "other Americas," in addition to growth for its Champion athletic wear brand in Europe.
Now what
Investors might have forgiven that slight earnings miss had it not been for Hanesbrands' guidance. For its current fourth quarter, the company is forecasting $1.4 billion to $1.45 billion in net sales, which is notably below the average prognosticator estimate of $1.63 billion. Ditto for adjusted per-share earnings: The apparel maker believes it will earn $0.04 to $0.11, against analyst expectations of $0.21.
