Genesco Inc. reported financial results for the second quarter of Fiscal 2027, ending August 1, 2026. The company announced that net sales for the quarter decreased 3% year-over-year to $530 million. Comparable sales decreased 1% overall, driven by a 2% increase at Journeys, a 4% increase at Johnston & Murphy, and a 9% decline at Schuh. E-commerce comparable sales decreased 6% for the period.
On the income statement, the company reported a GAAP operating income of $3.6 million, or 0.7% of sales, compared to an operating loss of $14.4 million in the prior year. Adjusted for one-time items, operating income improved to a loss of $8.3 million. GAAP earnings from continuing operations were $3.5 million, while adjusted earnings from continuing operations were a loss of $8.8 million. The company noted that the GAAP results included $22.5 million in tariff refunds related to the International Emergency Economic Powers Act.
Regarding the balance sheet, cash as of August 1, 2026, was $57.1 million, compared to $41.0 million in the prior year. Total debt was reported at $15.8 million, a significant decrease from $71.0 million at the end of the second quarter of Fiscal 2026. Inventories increased 8% year-over-year, primarily due to increased inventory at Journeys.
During the quarter, Genesco opened three stores and closed 25, ending the period with 1,186 stores. Capital expenditures for the quarter were $17 million, primarily for retail store remodels. The company did not repurchase any shares during the second quarter of Fiscal 2027 but has repurchased 317,503 shares in the third quarter as of August 31, 2026, with $18.8 million remaining on its expanded share repurchase authorization.
Based on the stronger-than-expected second quarter results, Genesco raised its adjusted diluted earnings per share (EPS) guidance for Fiscal 2027. The company now expects adjusted diluted EPS from continuing operations to be at the high end of the $2.00 to $2.40 range, up from the previous midpoint. The updated guidance reflects repurchases through August 31 and assumes a tax rate of 30% for the year, with a tax rate in the range of approximately 7% to 8% for the third quarter.
