IPAR earnings analysis
What we found in IPAR's 10-Q: the parts that mattered, the offsets in the same document, and what the company said about what comes next.
Our reading of the filing · Free to read, no account needed
Interparfums delivered 2% Q2 revenue growth to $341.0 million, with U.S. growth of 18% more than offsetting a 4% decline in European operations. Profitability weakened: gross margin declined 0.7 percentage points year over year to 65.5%, operating margin declined 3.3 points to 14.4%, and diluted EPS fell to $0.95 from $0.99. Liquidity and six-month cash conversion improved substantially, but Middle East disruption, tariff costs, higher marketing and royalty spending, and European softness remain near-term headwinds.
The parts that mattered.
Pulled out of the filing itself, with the figures the company reported.
- Revenue grew despite regional disruption
- Q2 net sales rose 2% year over year to $341.0 million from $333.9 million, led by an 18% increase in U.S.-based operations to $112.8 million. Revenue was down 1% sequentially from $344.9 million in Q1 2026.
- U.S. segment materially outperformed
- U.S.-based operations delivered a 61.6% Q2 gross margin, up 0.9 percentage points from 60.7%, while segment operating income increased 60% to $19.4 million from $12.1 million. GUESS, Donna Karan/DKNY, and Ferragamo sales increased 10%, 28%, and 41%, respectively.
- Cash conversion improved sharply
- Six-month operating cash flow improved to $45.7 million from $4.5 million in the prior-year period. Capital expenditure was only $2.4 million, implying approximately $43.3 million of calculated free cash flow and capex intensity of roughly 0.3% of six-month sales.
- Liquidity remains substantial and debt fell
- Cash, cash equivalents, and short-term investments totaled $211.3 million at June 30, 2026. Long-term debt including current maturities declined to $142.8 million from $176.0 million at December 31, 2025.
- Receivables collection remained controlled
- Working capital was $664 million at June 30, 2026. Accounts receivable declined to $301.8 million from $320.6 million at year-end, and days sales outstanding improved to 73 days from 74 days a year earlier.
- Tariff refunds supported reported results
- The company received $8.7 million of IEEPA tariff refunds through June 30, including $6.9 million recognized as a reduction in cost of sales, and received another $8.0 million in July 2026.
And the other side of it.
The offsets in the same document — the things a summary that only listed the good news would have left out.
- Operating-margin and EPS pressure
- Q2 operating margin compressed 3.3 percentage points year over year to 14.4% from 17.7%, and fell 7.1 percentage points sequentially from 21.5% in Q1 2026. Selling, general and administrative expense rose to 51.2% of sales from 48.5%, driven by marketing, royalty, and logistics costs.
- European and Middle East weakness persisted
- European-based Q2 sales declined 4% to $228.4 million and segment operating income fell 37% to $29.5 million from $47.0 million. Middle East and Africa first-half sales declined 24% to $38.2 million, with the Middle East conflict a 3% Q2 company sales headwind.
- Inventory increased and consumed cash
- Inventory rose 9% from year-end to $375.6 million, including finished goods of $248.7 million versus $221.7 million at December 31, 2025. Management attributes the increase to seasonality, although inventory still consumed $33.0 million of operating cash flow in the first half.
- Tariff costs remain a margin risk
- Tariffs remained a net expense of $8.2 million in the first six months despite $8.7 million of realized refunds. The company estimates total IEEPA tariffs paid at $17.6 million, leaving refund timing and tariff-cost exposure relevant.
- No risk-factor update; controls remediation ongoing
- No new risk-factor language was added: Item 1A refers investors to the 2025 Annual Report. However, management states its existing material weaknesses will not be remediated until controls operate effectively for a sufficient period and are validated through testing.
- Potential leverage for buybacks
- The board authorized a line of credit of up to $250 million, repayable over a maximum of 6 years, to fund a new share repurchase program; terms remain unfinalized and management cannot assure that any minimum shares will be repurchased.
- Customer concentration increased
- Macy's accounted for approximately 10% of first-half net sales in 2026, versus no customer representing 10% or more in the comparable 2025 period, increasing customer concentration.
What they reported.
What the company itself reported, taken out of the document.
- Earnings per share
- $0.95
- Gross margin
- 65.5%
- Operating margin
- 14.4%
- Segment
- United States-based operations: $112.6 million Q2 net sales, up 18% year over year from $95.8 million.
- Segment
- European-based operations: $228.4 million Q2 net sales, down 4% year over year from $238.2 million.
What they said about what is next.
The 10-Q provides no formal numeric revenue or EPS outlook. Management remains optimistic for the remainder of 2026 and expects full-year promotion and advertising expense to approach its long-term target of approximately 21% of net sales; it also cites blockbuster launches planned for 2027 and 2028.
The filing reads about the same as the one before it.
What came before.
- 10-Q · May 5, 2026
- Interparfums reported a positive Q1 for 2026 with net sales of $344.9 million, reflecting a 2% year-over-year increase. Despite slightly missing revenue consensus estimates by about $3 million, the company exceeded EPS…
- 10-K · March 10, 2026
- Inter Parfums (IPAR) reported modest top-line growth in 2025 with revenue of $1,489.0M (sum of quarterly revenues: $339M, $334M, $430M, $386M), roughly +2.5% versus 2024. Gross margin remained broadly stable (~63.7% in…
- 10-Q · November 6, 2024
- Interparfums reported quarter net sales of $424,629,000 for the three months ended September 30, 2024, up $56,660,000 (15.4%) versus $367,969,000 a year ago. Gross margin was $271,160,000 (≈63.9%) and income from…
- 10-Q · May 7, 2024
- Inter Parfums reported a modest revenue increase to $323,963 (three months ended March 31, 2024) versus $311,723 a year ago (+$12,240, ~3.9%), but operating profit and EPS weakened materially. Income from operations…
This is our reading of a public filing, not the filing. Read the original on SEC.gov · Educational only. Nothing here is investment advice.
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