The Buckle, Inc. Q3 FY2025 earnings call

• Net income for 13-week third quarter ended Nov 1, 2025 was $48.7 million or $0.96 per share vs $44.2 million or $0.88 per share prior year. Year-to-date net income was $128.9 million or $2.55 per share vs $118.3 million or $2.35 per share prior year.
• Net sales for 13-week third quarter increased 9.3% to $320.8 million. Comparable store sales up 8.3%, online sales up 13.6% to $53 million. Year-to-date net sales up 7.2% to $898.7 million, comparable store sales up 6.3%, online sales up 11.6% to $142.9 million.
• Gross margin for quarter was 48% (30 basis points increase from Q3 2024), year-to-date gross margin 47.4% (50 basis points increase from prior year).
• SG&A for quarter 29% of net sales vs 29.1% prior year, year-to-date 29.5% vs 29.6% prior year.
• Operating margin for quarter 19% vs 18.6% prior year, year-to-date 17.9% vs 17.3% prior year.
• Ended quarter with inventory $165.8 million (up 11% from year ago), total cash and investments $371.3 million. Opened 2 new stores, completed 6 full store remodels during quarter, with year-to-date 6 new stores, 17 full remodels and 3 store closures, anticipating 4 additional full remodeling projects by year-end.

For the third quarter, women's business merchandise sales increased about 19%, representing approximately 51% of sales (compared to 47% last year). Women's denim increased approximately 17.5% with average price points rising from $81.15 in Q3 2024 to $86.95 in Q3 2025. Men's merchandise sales were up about 1%, representing approximately 49% of total sales (compared to 53% prior year). Men's denim was up about 1% with average price points from $88.10 in Q3 2024 to $88.15 in Q3 2025. Accessory sales increased approximately 7.5% against prior year, accounting for ~10% of net sales, footwear sales were essentially flat at ~4.5%. Kids business increased approximately 22% year-over-year. Private label represented 47.5% of sales versus 48.5% in Q3 2024.

The company would like to reiterate its policy of not providing future sales or earnings guidance. All forward-looking statements made on the call are pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Actual results may differ materially due to risks and uncertainties described in the company's SEC filings. The company undertakes no obligation to publicly update or revise these statements, except as required by law.

Q: This is Mauricio Serna from UBS Research. First, maybe could you speak on a high level what you're seeing on the health of the U.S. consumer coming into the holiday season. There's been some talks about maybe some pressure on the lower income consumer. So I was interested in hearing from your side, what have you been seeing? And then also, could you speak about the denim business? I think you talked about the momentum in women's being up 17%. What do you -- how do you -- how are you thinking about the sustainability of this growth? And maybe could you talk about what you saw in men's denim demand over the quarter?

A: Thank you for the question. On the consumer, we haven't seen a big change in our stores. I mean the team and guests seem excited about our product response. There's probably a slight caution in some as our units per sale are off very slightly. But overall, we feel good about it. And if the guest is excited about the product and the quality we have, it's been going pretty well. The ladies denim business continues to be excellent. There's still a lot of variety of styles and fits. We've added some of our branded sources to the mix, which has added some higher price points, have been good for the business. And our fashion brands and our private brands continue to sell well. So we're optimistic about the gal's denim business throughout the rest of the year. On the men's denim, our private label brands are consistent and doing well, having good sell-throughs. We haven't seen as much from other brands adding to the private brands mix, but feel our denim business is solid in men's as well.

Q: Great. Just on the other thing that I wanted to ask was the merchandise margin. It was down 10 basis points. Maybe could you elaborate on what were the puts and takes behind the merchandise margin trend in this quarter?

A: Thank you, Mauricio. This is Tom. Yes, merchandise margins were down 10 basis points for Q3 and up 10 basis points for Q2. So I think if you look year-to-date with everything going on with tariffs, we feel really strong about where we're at from a merchandise margin perspective. And we've been operating at a high level of merchandise margins for a long time and have continued to improve that. So both Q1 and Q2 were all-time highs merchandise margins and we were off just a little bit in Q3. So I feel really good about where we're at. The biggest drivers are really -- Adam called out the decrease slightly in private label business with some of the brands performing really well, especially in women's denim. That's the biggest driver probably of the shift this year and especially Q2 compared to Q3 and then a slight increase in costs with tariffs and other flow-throughs.