Duluth Holdings Grows Q2 Profit Margins
Duluth Holdings(NASDAQ:DLTH) reported second quarter 2025 results on July 22, 2025, posting adjusted EBITDA of $12 million despite a 7% year-over-year decline in net sales to $131.7 million. Management reaffirmed full-year adjusted EBITDA guidance of $20 million to $25 million for fiscal 2025, highlighting progress in margin expansion, inventory reduction, and cost containment. The following insights detail the company’s strategic execution on promotional discipline, inventory rationalization, and tariff mitigation.
Gross margin expanded by 240 basis points year-over-year to 54.7%, even as net sales contracted 7% YoY, reflecting a deliberate reduction in promotional activity. Retail store sales grew 5.3% YoY in the second quarter of 2025, driven by improved traffic, conversion, and higher average order value, while web traffic declined due to fewer promotions.
This margin-focused strategy signals a successful pivot from volume-driven promotions to profitability, strengthening the company’s earnings quality and resilience.
Source Fool.com
