5 Must-Read Analyst Questions From Kontoor Brands’s Q2 Earnings Call

August 14, 2025 at 01:32 AM EDT

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Kontoor Brands delivered a robust Q2, with management attributing the strong performance to accelerating momentum at Wrangler, early progress in the Lee turnaround, and the positive initial impact from the Helly Hansen acquisition. CEO Scott Baxter emphasized that "Wrangler growth accelerated, the Lee turnaround is on track, and Helly Hansen performed above plan," highlighting how portfolio diversification is now translating into broader market opportunities. The quarter’s revenue outperformance was propelled by double-digit digital gains and continued market share expansion in Western and denim categories, supported by targeted investments in product development and marketing. Management noted that strategic investments in talent and demand creation are yielding healthy returns, particularly in the U.S. and digital channels.

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Kontoor Brands (KTB) Q2 CY2025 Highlights:

Revenue: $658.3 million vs analyst estimates of $634.9 million (8.5% year-on-year growth, 3.7% beat)
Adjusted EPS: $1.21 vs analyst estimates of $0.83 (46.1% beat)
Adjusted EBITDA: $107.2 million vs analyst estimates of $83.7 million (16.3% margin, 28.1% beat)
The company slightly lifted its revenue guidance for the full year to $3.11 billion at the midpoint from $3.08 billion
Management reiterated its full-year Adjusted EPS guidance of $5.45 at the midpoint
Operating Margin: 11.9%, in line with the same quarter last year
Constant Currency Revenue rose 8% year on year (-1% in the same quarter last year)
Market Capitalization: $3.93 billion

While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.

Our Top 5 Analyst Questions From Kontoor Brands’s Q2 Earnings Call

Irwin Bernard Boruchow (Wells Fargo) asked about the EBIT run rate for Helly Hansen and the outlook for operating margin expansion. CFO Joe Alkire detailed that Helly Hansen is expected to reach high single-digit growth and operating margin improvements, with synergies helping to offset tariff impacts.
Mauricio Serna Vega (UBS) pressed for more detail on Q3 and Q4 revenue cadence and specific actions in the Lee brand’s Asia-Pacific turnaround. CEO Scott Baxter outlined improvements in inventory and retail partnerships in China, while Alkire said foundational work should support long-term growth.
Paul David Kearney (Barclays) sought clarification on tariff impacts and mitigation actions. Alkire explained that most of the incremental tariff impact has been offset, with only a $15 million net drag expected in 2025, and outlined ongoing supply chain and pricing measures.
Peter Clement McGoldrick (Stifel) questioned the integration pace and growth opportunities for Helly Hansen in North America. Baxter highlighted strong cultural fit, new store openings, and expansion into outdoor and workwear segments.
Brooke Siler Roach (Goldman Sachs) asked about the timing and expected returns on new marketing investments. Baxter confirmed a significant ramp-up, especially in Lee’s upcoming campaign and Wrangler’s continued promotions, aiming to drive revenue acceleration in key channels.

Catalysts in Upcoming Quarters

In the coming quarters, our analysts will watch for (1) sustained Helly Hansen growth and evidence of synergy capture, (2) the effectiveness of Lee’s brand campaign in driving digital and wholesale gains, and (3) progress on Project Jeanius cost initiatives to offset tariff pressures. Additional signposts include improvements in working capital, inventory management, and execution of U.S. and international distribution strategies across the portfolio.

Kontoor Brands currently trades at $70.71, up from $56.72 just before the earnings. Is there an opportunity in the stock?See for yourself in our full research report (it’s free).

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5 Must-Read Analyst Questions From Kontoor Brands’s Q2 Earnings Call

Kontoor Brands (KTB) Q2 CY2025 Highlights:

Our Top 5 Analyst Questions From Kontoor Brands’s Q2 Earnings Call

Catalysts in Upcoming Quarters

High-Quality Stocks for All Market Conditions

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