A Rough Fall for the Scent Giant
What happened this week that made investors pause? Bath & Body Works, the company that basically owns the smell of every mall in America, just told everyone that its third-quarter sales dropped about 1 percent to $1.6 billion. Profits took an even harder hit. Earnings per share landed at 37 cents—35 cents if you adjust for one-time items—and that’s lower than last year. The numbers weren’t pretty, and the stock felt it right away.
Why does this matter to regular people?
Think about it: when was the last time you walked past a Bath & Body Works and didn’t get pulled in by Pumpkin Pecan Waffles or Japanese Cherry Blossom? These stores used to feel like a sure thing. Now the company admits shoppers are tightening their belts. Too many candles, too many body creams, and maybe not enough excitement lately. Customers still love the brand—loyalty sales actually went up—but total traffic in stores and online just wasn’t there.
The New Guidance: Brace for a Quiet Holiday Season
What’s coming next? Management now expects fourth-quarter sales to fall in the high single digits. Yes, the biggest shopping period of the year. For the whole of 2025 they’re guiding to low single-digit declines overall, with earnings per share coming in at least $2.83. Translation: the holiday rush probably won’t save the year the way it usually does.
Is this just a blip or something bigger?
Honestly, it feels bigger. Competitors like Victoria’s Secret (the old sister company) have been struggling for years. Ulta and Sephora keep grabbing beauty dollars. Even Target and Walmart have stepped up their game with affordable scents. Bath & Body Works isn’t in danger of disappearing, but the easy growth days seem behind it.
Enter the Consumer First Formula – Their Big Comeback Play
So what are they doing about it? Leadership unveiled something they call the “Consumer First Formula.” It’s built on four simple—but huge—pillars. Let’s break them down like we’re chatting over coffee.
- Bring back the wow in products They plan to pour money into the categories people already love: body care, candles, hand soaps. Think fewer random collections, more perfect versions of the classics plus a couple of jaw-dropping new launches each season.
- Make the brand feel fresh again Stores are getting a facelift, packaging is changing, marketing will lean harder into joy and self-care instead of just “buy three, get three.” Remember when everyone carried those glittery bags like trophies? They want that energy back.
- Go where the customers actually shop Digital sales need to grow faster, international expansion is picking up speed (especially Canada, UK, and partners in the Middle East), and wholesale—like selling through Kohl’s or even airports—will get a serious push.
- Cut $250 million in costs over two years That means smarter buying, leaner supply chain, fewer markdowns, and probably some tough decisions behind the scenes. The goal: protect margins even when sales are soft.
Will any of this actually work?
History says maybe. Back in 2020-2021, when everyone was stuck at home burning candles like never before, same-store sales jumped over 20 percent some quarters. The company knows how to ride a wave. The question is whether they can create the next wave themselves instead of waiting for another pandemic-level scent boom.
What Shoppers Can Expect in the Next 12-18 Months
- New signature collections that stick around longer instead of 80 limited-edition drops nobody can keep track of.
- Brighter, cleaner stores that don’t feel so cluttered.
- Better online experience—faster shipping, easier returns, maybe even a subscription for your favorite lotion.
- Prices might creep up on hero items, but they’ll try to offset that with sharper promotions on everything else.
Bottom line for customers?
Your Japanese Cherry Blossom isn’t going anywhere. But the days of walking out with eight items for $40 might get a little rarer. The company is betting that if they make the products and the experience irresistible again, people will happily pay a bit more.
A Company at a Crossroads
Bath & Body Works still has millions of die-hard fans—myself included, if I’m being honest; my wife has an entire closet shelf dedicated to Warm Vanilla Sugar. Yet this quarter reminded everyone that even beloved brands can hit speed bumps when wallets get tight and attention scatters.
Leadership insists the Consumer First Formula isn’t just corporate speak—it’s the roadmap back to growth. If they nail product innovation and make the stores feel special again, 2026 could smell a whole lot sweeter than 2025.
