Columbia Sportswear raises 2026 profit floor as inventory and cash flow diverge
Columbia Sportswear raised the low end of its 2026 revenue, operating-income and EPS outlook after third-quarter sales and profit exceeded its guidance. The improvement came with a balance-sheet trade-off: inventories rose as delayed Fall 2026 receipts and earlier Spring 2027 production moved through the supply chain, while the company lowered its operating-cash-flow forecast.
A stronger quarter, helped by timing and lower prior-year charges
For the quarter ended September 30, net sales rose 2% to $962.6 million from $943.4 million a year earlier. Operating income increased to $109.6 million from $67.4 million, lifting the margin to 11.4% from 7.1%. The comparison benefited from the absence of $29.0 million of prAna and Mountain Hardwear impairment charges recorded in Q3 2025. Net income rose to $84.7 million from $52.0 million, and diluted EPS increased to $1.66 from $0.95; the prior-year impairment reduced 2025 EPS by $0.46.
Management said the quarter reflected some delayed Fall 2026 wholesale orders shipping earlier than expected, better U.S. direct-to-consumer trends and continued international momentum. The revenue increase therefore reflects both underlying demand signals and shipment timing. The company release did not provide a reliable sell-side consensus figure, so no consensus comparison is asserted here.
Guidance improves at the low end, but cash conversion is the watchpoint
The new full-year outlook calls for $3.46–$3.50 billion of revenue, versus $3.43–$3.50 billion previously; $300–$320 million of operating income, versus $290–$325 million; and $4.65–$4.90 of diluted EPS, versus $4.45–$4.90. Gross-margin guidance remains 52.1%–52.3%, including the effect of IEEPA tariff refunds.
The company now expects $230–$250 million of 2026 operating cash flow, down from $290–$310 million previously, while its capital-expenditure plan is $60–$70 million versus $65–$75 million. Management attributed the cash-flow change to earlier Spring 2027 production, which is expected to increase year-end inventory.
At September 30, cash, cash equivalents and short-term investments totaled $229.6 million and the company had no borrowings. Inventory was $889.2 million, up 11% from $800.4 million a year earlier, primarily because of higher in-transit Fall 2026 goods and earlier Spring 2027 production. That leaves a meaningful execution question for investors: the raised profit floor depends on converting improved order timing and the ACCELERATE strategy into sales without allowing inventory and working capital to absorb the benefit.
Q3 net sales
$962.6M
↑ +2% year over year vs $943.4M
Q3 diluted EPS
$1.66
↑ vs $0.95 year over year
FY EPS outlook
$4.65–$4.90
↑ low end raised $0.20 2026 guidance
FY operating cash flow
$230–$250M
↓ prior $290–$310M 2026 guidance
Sources
Quarterly revenue, Columbia Sportswear
Margins by quarter
Twelve quarters of figures
| Quarter | Q3 '23 | Q4 '23 | Q1 '24 | Q2 '24 | Q3 '24 | Q4 '24 | Q1 '25 | Q2 '25 | Q3 '25 | Q4 '25 | Q1 '26 | Q2 '26 |
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Revenue | $986M | $1.1B | $770M | $570M | $932M | $1.1B | $779M | $605M | $943M | $1.1B | $779M | $614M |
| Revenue growth | 3.2% | −9.4% | −6.2% | −8.2% | −5.5% | 3.5% | 1.1% | 6.1% | 1.3% | −2.4% | 0.1% | 1.5% |
| Gross margin | 48.7% | 50.6% | 50.6% | 48.0% | 50.2% | 51.1% | 50.9% | 49.1% | 50.0% | 51.6% | 50.7% | 58.3% |
| Operating margin | 13.7% | 10.7% | 5.8% | −4.2% | 12.1% | 12.5% | 6.0% | −3.9% | 7.1% | 10.9% | 5.4% | 5.0% |
| Net income | $104M | $93.3M | $42.3M | −$11.7M | $90.2M | $103M | $42.2M | −$10.2M | $52.0M | $93.2M | $34.3M | $26.6M |
| Diluted EPS | $1.70 | $1.53 | $0.71 | −$0.20 | $1.56 | $1.78 | $0.75 | −$0.19 | $0.95 | $1.71 | $0.65 | $0.52 |
| Cash from operations | $12.5M | $614M | $107M | $2.1M | −$186M | $568M | −$32.0M | −$30.8M | −$271M | $616M | −$77.5M | $115M |
| Capital expenditure | $18.6M | $13.3M | $14.8M | $13.0M | $13.9M | $18.1M | $15.6M | $14.5M | $16.6M | $19.5M | $12.4M | $13.4M |
| Free cash flow | −$6.1M | $601M | $92.0M | −$10.9M | −$199M | $550M | −$47.6M | −$45.3M | −$287M | $597M | −$90.0M | $102M |
| Dividends and buybacks | $84.6M | $57.5M | $68.1M | $70.1M | $145M | $104M | $118M | $46.7M | $56.4M | $45.5M | $166M | $15.4M |
This story describes figures the company has published. It is for information only and is not investment advice or a recommendation to buy, sell or hold any security. Check the original filings before relying on any figure. Stoqly is not affiliated with the SEC or Columbia Sportswear.
