Helen of Troy Shares Jump 8.3% After Q2 Earnings Beat and Higher Full-Year Guidance

Helen of Troy Limited (NASDAQ:HELE) shares surged 8.30% in pre-market trading after the consumer products company reported second-quarter fiscal 2027 earnings that substantially exceeded analysts’ expectations and raised its full-year financial outlook.

The company posted adjusted earnings of $0.79 per share, beating the Wall Street consensus estimate of $0.51 by $0.28 per share.

Quarterly revenue increased 2.1% year on year to $440.9 million, compared with $431.8 million in the corresponding period of fiscal 2026.

However, revenue fell slightly short of analysts’ expectations of $443.22 million, highlighting a modest difference between the company’s sales performance and market forecasts.

The stronger earnings performance was supported by improved operating margins, lower promotional expenses and benefits from tariff refunds received during the quarter.

Helen of Troy also reported growth in its Home & Outdoor business, which helped offset weaker sales in the Beauty & Wellness segment.

Helen of Troy Raises Fiscal 2027 Earnings and Revenue Forecasts

Following the quarterly results, Helen of Troy increased its financial guidance for the full fiscal year.

The company now expects adjusted earnings per share of between $3.60 and $4.15, compared with the analyst consensus estimate of $3.55.

The revised earnings outlook places even the lower end of the company’s forecast slightly above market expectations.

Helen of Troy also raised its annual revenue guidance to between $1.768 billion and $1.822 billion, compared with the Wall Street consensus of $1.81 billion.

The midpoint of the revised revenue range, approximately $1.795 billion, remains slightly below analysts’ expectations.

The updated forecasts indicate that management anticipates stronger profitability despite a more moderate revenue outlook.

The company also increased its adjusted earnings before interest, taxes, depreciation and amortisation (EBITDA) guidance to between $203 million and $210 million, up from its previous range of $190 million to $197 million.

In addition, Helen of Troy raised its full-year free cash flow forecast to between $120 million and $140 million, compared with its earlier projection of $85 million to $100 million.

The higher cash flow guidance reflects management’s improved expectations for cash generation during the remainder of the financial year.

Tariff Refunds Contribute to Margin Expansion

Helen of Troy’s second-quarter results included a gross pre-tax benefit of $26.9 million from tariff refunds.

The company reinvested approximately $23 million of that amount, resulting in a net pre-tax benefit of around $4.0 million.

The refunds contributed to a substantial improvement in gross profitability during the reporting period.

Gross profit margin expanded by 800 basis points to 52.2%, primarily reflecting the favourable impact of tariff refunds and lower retail trade and promotional expenses.

Adjusted operating margin also improved, increasing by 240 basis points to 8.6%, compared with 6.2% in the prior-year quarter.

The margin expansion demonstrated improved profitability despite the company’s relatively modest revenue growth.

Chief Executive Officer G. Scott Uzzell said the results reflected continued progress in implementing the company’s longer-term business strategy.

“Our second quarter results reflect continued progress against our multi-year roadmap. Sales were in line, and Adjusted EBITDA and Adjusted EPS were better than expected, without including the net tariff refund benefit in the quarter,” Uzzell said.

The CEO’s comments highlighted that the company’s adjusted profitability exceeded expectations even when excluding the net benefit from tariff refunds.

Home & Outdoor Growth Offsets Beauty & Wellness Weakness

The Home & Outdoor segment was the principal contributor to Helen of Troy’s quarterly revenue growth.

Segment revenue increased 9.2% year on year to $227.9 million, supported by stronger demand for packs, higher international sales and expanded distribution.

The performance reflected improved demand across parts of the company’s outdoor and lifestyle product portfolio.

In contrast, the Beauty & Wellness business reported a 4.5% decline in revenue to $213.0 million.

The decrease was primarily attributed to softer demand for hair appliances and prestige hair care products.

The contrasting segment performances highlighted the uneven demand environment across Helen of Troy’s consumer product categories.

While Home & Outdoor delivered solid growth, weakness in Beauty & Wellness continued to weigh on the company’s overall revenue performance.

Improved Profitability Supports Investor Sentiment

Helen of Troy’s stronger-than-expected adjusted earnings, higher operating margins and increased full-year guidance contributed to the sharp rise in its shares during pre-market trading.

The company raised its expectations for adjusted earnings, EBITDA and free cash flow while maintaining a revenue outlook whose midpoint remained slightly below the market consensus.

Although tariff refunds provided a benefit during the quarter, management indicated that adjusted profitability exceeded expectations even without the net refund contribution.

Investors will be monitoring whether the company can sustain its margin improvements, maintain growth in Home & Outdoor and stabilise demand in the Beauty & Wellness business.

Helen of Troy’s updated guidance suggests management expects continued progress in profitability and cash generation as it advances its multi-year operating strategy.

Helen of Troy stock price