What Are the Key Sources Of Revenue for Guess Inc?

by Trefis Team
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Guess Inc.’s  (NYSE: GES) key sources of revenues are Americas Retail, Americas Wholesale, Europe and Asia, of which the Europe and Asia segment are responsible for more than 65% of the company’s revenues. Below we discuss the company’s key revenue sources and its expected 2018 performance using an interactive dashboard What Are Guess Inc’s Key Sources of Revenues. You can modify our forecasts for the company’s revenues and key drivers to see how changes would impact its earnings.

Guess’ profitability in the wholesale business has been on a upward trend in Europe and Asia. In Q2 the European wholesale segment grew by 22.2% in U.S. dollars and 19.4% in constant currency, and the trend is expected to carry on in the coming quarters as well. This growth was propelled by a rise in comparable store sales, including e-commerce sales, and a host of store openings.  The e-commerce business in Europe was boosted by Guess’ own website along with the partnerships it forged with websites like Zalando, and the Retail comp sales, including e-commerce, increased 5% in U.S. dollars.

The company also doubled its capital allocation for the Asian stores and the e-commerce business in Asia strengthened by a greater presence on websites like Tmall, JD.com, and Guess.cn. Asia revenues increased 32% in U.S. dollars driven by a rise in store openings, and comparable store sales (which included e-commerce sales as well)  increased 17% in U.S. dollars. Driven by the growing trend of online shopping, online sales of the company have also been rising in every geography underlining this to be a global trend, especially in Europe and Asia.

During the recent Q2 earnings, the company’s revenues increased by 14% to $646 Million boosted by its rising comparable store sales and e-commerce sales in both Europe and Asia (especially China). Looking ahead for Q3 and beyond, the company continues to focus on improving the customer experience in stores and online and improving assortments in compelling new product launches. They still see a lot of opportunity in the Europe and Asia geographies, where they will continue to allocate capital and  plan to continue growing sales while also expanding margins. They also plan to keep working on improving the profitability of the Americas by executing on their cost reduction and margin improvement initiatives.


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