Kontoor Brands said second-quarter revenue from continuing operations rose 19% to $584 million, lifted by $114 million of Helly Hansen revenue and 2% growth at Wrangler.
Gross margin expanded sharply: reported gross margin increased 970 basis points to 56.2%, while adjusted gross margin rose 710 basis points to 53.8%.
Operating income from continuing operations was $91 million on a reported basis and $94 million adjusted, up 19% from a year earlier. Adjusted operating margin edged up 10 basis points to 16%.
Diluted earnings per share from continuing operations came in at $1.03 reported and $1.06 adjusted, up 13% from the prior year.
Wrangler global revenue reached $469 million, up 2%. U.S. revenue rose 1%, with direct-to-consumer up 9% and wholesale flat. International revenue climbed 10%, including 31% growth in direct-to-consumer and 7% growth in wholesale.
Helly Hansen generated $114 million of revenue in the quarter. The company said the brand delivered double-digit revenue growth on a pro forma basis in the first half of 2026.
SG&A expenses were $238 million reported, or 40.7% of revenue, and $221 million adjusted, or 37.8% of revenue.
Kontoor ended the quarter with $58 million in cash and cash equivalents and $1.1 billion of long-term debt. Inventory fell 3% to $526 million.
The company returned $80 million to shareholders in the quarter, including $50 million of stock repurchases at an average price of $74 per share. Year to date, it has repurchased $75 million of stock at an average price of $75.
Kontoor raised its full-year adjusted EPS outlook to $5.25 to $5.35 from $5.15 to $5.25. That implies 27% to 29% growth versus the prior year.
Full-year revenue guidance remained unchanged at $2.66 billion to $2.71 billion. The company now expects adjusted gross margin of 49.8% to 50.0%, up from a prior outlook of 48.3% to 48.5%.
Adjusted operating income is now forecast at $413 million to $420 million, and the company expects about $30 million of capital expenditures.
The company said it plans to deploy $400 million of expected Lee divestiture proceeds into an accelerated share repurchase once the deal closes in the fourth quarter, with remaining proceeds going to debt reduction. It expects to return more than $900 million of capital in 2026 through buybacks, dividends and voluntary debt payments. As a result of these announcements, the company's shares have moved 6.52% on the market, and are now trading at a price of $79.85. Check out the company's full 8-K submission here.
