June earnings update: Paychex, FedEx, Carnival, Chewy, Petco and Lululemon

Yahoo

12-07-2025

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Earnings calls, loved by some CFOs and dreaded by others, allow finance leaders and their fellow executives to verbalize their organization's progress. Each month, CFO.com compiles interesting insights shared by CFOs during these calls for The CFO Earnings Dispatch series. These insights include statements about their company, analysis of financial data and answers to analysts' questions.
For June, we highlight CFO comments from Paychex, FedEx, BlackBerry, Carnival, Chewy, Vera Bradley, Guess, Petco and Lululemon.
Market cap: $52.08 billion Date of call: June 25 Paychex is reshaping its go-to-market model following the acquisition of Paycor, which closed in Q4, adding 50,000 mid-market clients and an enterprise-focused human capital management platform to the company. As integration progresses, CFO Bob Schrader emphasized that the acquisition was about long-term growth, not just the cost savings of the deal. 'We're hoping to beat that [cost synergy target of $90 million in FY2026], but at the same time, we're gonna look to potentially balance that with reinvestment in the business,' Schrader said. 'As we've talked about, this is a growth story for us. You know, we didn't do this deal for the cost synergies. We did this to provide an enhanced runway for growth for the company as we move forward, and we think that we've done that. And so we're going to balance that additional cost synergies with investments as we move forward.'
Market cap: $56.38 billion Date of call: June 24 FedEx is showing how CFOs can protect margins during a revenue slowdown by executing on pre-planned efficiency programs. Despite flat revenue, the company said it delivered $2.2 billion in cost savings through its DRIVE initiative while also reducing capital expenditures. CFO John Dietrich emphasized controlling what the company can — cutting costs, reducing CapEx and managing pricing — while acknowledging continued weakness in industrial demand and trans-Pacific trade. 'We also significantly reduced our CapEx spending in FY 2025 by approximately $1.1 billion for a total of $4.1 billion compared to $5.2 billion in FY 2024. This marks our lowest capital spending in over ten years. Additionally, our CapEx as a percentage of revenue was 4.6%, the lowest level since FedEx Corporation was established in fiscal year '98,' said Dietrich.
Market cap: $2.42 billion Date of call: June 24 After exceeding expectations across all major business lines in Q1 FY2026, BlackBerry is delivering $121.7 million in revenue and $16.4 million in adjusted EBITDA. The company posted positive GAAP net income for the first time in more than three years. CFO Tim Foote highlighted the impact of sustained cost discipline and a deliberate approach to capital deployment, including the launch of a $100 million share repurchase program. 'We're delighted that we're in a position now to be able to do a buyback. It shows the strength of our balance sheet and the plan going forward. So we're feeling good about that,' said Foote. 'We ultimately, as good stewards of capital, will consider a number of different factors like cash flow in the quarter, share price, other alternative uses of capital that we might have available, that type of thing. So it's not gonna be a linear thing, I would say. It would just be whatever we think makes the best sense for shareholder value.'
Market cap: $37.66 billion Date of call: June 24 After posting a record second-quarter operating income and EBITDA, Carnival Corp. is raising full-year net income guidance by $200 million to $2.7 billion. CFO David Bernstein highlighted strong yield performance, disciplined cost controls and strategic capacity additions. Alongside financial outperformance, the company's efforts come at a time when it is tightening its policies around its code of conduct, enforcing rules that were previously lightly applied in response to an uptick in inappropriate passenger behavior.
Although this did turn into a public relations problem for the company, it hasn't impacted new offerings yet, as Carnival's finance team is already at work preparing for two major 2026 launches, its Celebration Key destination and the new Carnival Rewards loyalty program. During his brief comments on the call, Bernstein explained how the company is going to recognize this new revenue. 'Accounting treatment for recognizing revenue requires a deferral of a portion of the ticket price paid by the guest equal to the value of future program benefits earned,' Bernstein said. 'Over time, the redemption of benefits by guests will build in, so will the revenue recognized for delivering these benefits to the guests.' Bernstein continued: 'We expect that it will take approximately two years for the revenue recognized each quarter from the benefits redeemed by guests to exceed deferred revenue of the portion of the ticket price paid for the future benefits. Once this happens after approximately two years, the program will be accretive to our yields.'
Market cap: $15.99 billion Date of call: June 11 Chewy CFO David Reeder will depart the company in the coming weeks to take on a CEO role in the semiconductor industry. The departure comes as Chewy reported $3.12 billion in Q1 net sales, up 8.3% year over year, with adjusted EBITDA reaching $192.7 million and active customers growing to 20.8 million. The quarter also saw strong performance in autoship sales, which rose nearly 15% and accounted for more than 82% of total revenue. 'Leaving Chewy is a bittersweet decision,' Reeder said. 'The company has a clear differentiated strategy and a strong leadership team focused on delivering exceptional customer experiences... I wish the company continued success in the years ahead.'
Market cap: $66.48 million Date of call: June 11 Vera Bradley introduced a new CFO, Michael Schwindle, during its Q1 FY2026 earnings call, as the company undergoes leadership changes and suspends financial guidance amid continued transformation efforts. The quarter saw revenue decline to $51.7 million, down from $67.9 million the year prior, with gross margin falling to 47.5% amid channel shifts and rising freight costs. 'The entire Vera Bradley team is working hard on enormous business changes, as [CEO Jackie Ardrey] and I have discussed in numerous calls,' Schwindle said. 'I sincerely appreciate this effort and know it will be pivotal in the next phase of the business transformation as well as improved performance in the future.'
Market cap: $665.29 million Date of call: June 5 Guess CFO Alberto Toni joined the company in early June, and in his first earnings call, said he was 'thrilled to join such a great organization and an amazing brand.' CEO Carlos Alberini praised the company's 'deep bench of finance leaders' including Toni and noted that the team is well-positioned to drive strategic priorities and sustainable growth. Interim CFO Dennis Secor provided the quarter's financial commentary and offered context around ongoing margin pressures, including the impact of retail softness and evolving business mix. 'That margin decline was driven primarily by deleverage on the fixed cost base given the comp declines both in-store and online, more markdowns and higher store costs,' Secor said. 'These were partially offset by the addition of the Rag and Bone business and an increased initial markup.'
Market cap: $945.88 million Date of call: June 5 Despite a 2.3% year-over-year decline in Q1 net sales, Petco CFO Sabrina Simmons said the company is delivering on its core priorities: gross margin expansion, SG&A leverage and improved ROIC. Gross margin increased 30 basis points to 38.2%, and adjusted EBITDA rose $13.8 million to $89.4 million. The company reiterated its full-year outlook despite headwinds from store closures and consumer softness. 'I talked about it last quarter and again this quarter, that we're really working on a change in mindset. That's the most important thing,' Simmons said. 'Our goal is not just about cost-cutting. Our goal is to leverage SG&A. So we're very much setting the stage, building the strong foundation right now this year. But as we grow sales, we can manage SG&A well, and leverage that will help operating margin expansion.'
Market cap: $28.29 billion Date of call: June 5 Lululemon reported lackluster performance for the first quarter of fiscal 2025, highlighting ongoing pressure in the luxury athleisure space as consumer appetite softens. The company lowered its full-year operating margin guidance, citing tariffs and FX pressures, and continues to face legal complications, most recently filing a case against Costco for selling Lululemon 'dupes.' This marks at least the second time the company has taken legal action against the wholesale retailer over brand infringement. CFO Meghan Frank said the company remains focused on long-term investments despite near-term margin pressure: 'We are managing expenses prudently while also continuing to invest to drive long-term growth and set ourselves up for future success,' said Frank. 'This includes new store openings and optimizations, new market entries, growing brand awareness and ensuring we have adequate capacity across our supply chain.'
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