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Helen of Troy shares rose 8.3% in premarket trading on Thursday, October 8, after the consumer-products company reported second-quarter fiscal 2027 adjusted earnings above analyst expectations and raised its full-year profit and cash-flow forecasts. Revenue increased year over year but came in slightly below the consensus estimate cited by Investing.com.
The company reported adjusted diluted earnings of $0.79 a share for the quarter ended August 31, compared with analyst expectations of about $0.50. Net sales rose 2.1% to $440.9 million from $431.8 million a year earlier. Helen of Troy also lifted its full-year adjusted earnings-per-share range to $3.60–$4.15, from $3.25–$3.75 previously, and raised its free-cash-flow outlook to $120 million–$140 million from $85 million–$100 million.
The share move followed results released before the market opened. The company’s release and management comments give context for the reaction: stronger adjusted profitability and a higher outlook arrived alongside improving sales in Home & Outdoor, while the Beauty & Wellness segment remained uneven and tariff refunds contributed to margins.
Earnings and sales show different trends
Helen of Troy’s $0.79 adjusted diluted earnings per share compared with $0.59 in the prior-year quarter. Adjusted operating income increased 40.9% to $37.9 million, and adjusted operating margin widened to 8.6% from 6.2%, according to the company’s results. These are non-GAAP measures, which exclude specified items and should be distinguished from the company’s reported GAAP figures.
On a GAAP basis, net income was $4.6 million, or $0.19 a diluted share. A year earlier, the company recorded a $308.6 million net loss, including substantial non-cash impairment charges. The comparison therefore reflects both current operating performance and the absence of those prior-year charges; it does not mean the prior-period loss was solely a recurring operating loss.
Revenue of $440.9 million was up from $431.8 million, but below the $443.22 million consensus estimate reported by Investing.com. The modest sales growth thus did not match the scale of the adjusted earnings improvement, helping explain why investors focused on margins and the raised outlook as well as the top-line result.
Tariff refunds supported margins
Gross profit margin expanded to 52.2% from 44.2% a year earlier. Helen of Troy said tariff refunds, net of higher tariff costs, accounted for about 560 basis points of the year-over-year margin increase; lower retail trade and promotional expense also helped. Inflationary product costs, including commodities, fuel, freight and foreign currency effects, partly offset those benefits.
The company received $26.9 million in gross pre-tax tariff refunds during the quarter. It reinvested approximately $23 million, leaving a net pre-tax benefit of about $4 million, which Helen of Troy estimated contributed roughly $0.12 to diluted earnings per share. That contribution is relevant when assessing the quarter: the refund lifted reported results, but the full gross refund was not retained as earnings.
Chief Executive G. Scott Uzzell said the company’s adjusted EBITDA and adjusted earnings were better than expected, excluding the net tariff-refund benefit. He also described sales growth as broad-based across Home & Outdoor, Wellness and International, and said the company intended to reinvest most tariff refunds in its business while allowing part to support near-term earnings and liquidity.
Home & Outdoor growth offset weakness elsewhere
Home & Outdoor sales increased 9.2% to $227.9 million. The company attributed the gain to demand for technical, travel and lifestyle packs, higher international sales, assortment and distribution gains, closeout sales and new product launches. The segment’s operating income was $24.1 million, compared with an operating loss in the prior-year quarter, which had included impairment charges.
Beauty & Wellness sales declined 4.5% to $213.0 million. Lower sales of hair appliances, prestige hair care and water filtration outweighed growth in heaters, thermometers and nail care. Its adjusted operating income increased 45.7% to $10.0 million, but the segment still reported a GAAP operating loss of $1.1 million.
The split helps qualify the company’s overall 2.1% sales increase: growth was concentrated in Home & Outdoor, while Beauty & Wellness contracted. Management said the broader portfolio was improving, but the quarterly figures do not show uniform growth across its businesses.
Higher profit and cash-flow forecasts, narrower sales range
Helen of Troy’s revised fiscal 2027 outlook calls for net sales of $1.768 billion to $1.822 billion, a range that narrows the company’s previous forecast. Adjusted diluted earnings per share are now expected at $3.60–$4.15, compared with the prior $3.25–$3.75 range. The company also raised its operating-cash-flow forecast to $163 million–$179 million and its free-cash-flow range to $120 million–$140 million.
The company’s updated forecast includes an estimated pre-tax benefit of approximately $80.5 million from tariff refunds across three phases, and assumes tariff rates in place as of September 2026 remain in effect for the rest of the fiscal year. Helen of Troy also raised planned capital spending to $39 million–$43 million, from $30 million–$34 million, citing product innovation, distribution-network optimization and supply-chain diversification.
The company’s second-quarter webcast was scheduled for 9 a.m. Eastern on October 8. The results and higher profit and cash-flow forecasts provide a clear near-term explanation for the premarket advance, while the revenue miss, weakness in Beauty & Wellness and the role of tariff refunds remain important parts of the earnings picture.
