Saks Slashes Outlook and Reports Sales Drop on Inventory Issues

(Bloomberg) — Saks Global Enterprises lowered its full-year forecast and reported a decline in sales in its earnings update to investors on Thursday, citing difficulties managing inventory flow after years of troubled vendor relationships, according to people with knowledge of the results.

The luxury retailer’s sales fell 13% to $1.6 billion in the second quarter from a year earlier, and it suffered a $77 million loss on a single earnings measure, compared with a $41 million loss in the same quarter last year, said the people, who asked not to be identified discussing private information.

It also cut its 2025 earnings forecast by about half, giving it a range of around $150 million on Thursday’s investor call, compared to about $300 million earlier this year. The company’s bonds due in 2029 fell after that revision, trading as low as 44.5 cents on the dollar, according to Trace. On Wednesday, that level was about 51 cents.

The update comes after Saks restructured its $2.2 billion debt load in August, incurring huge losses to some creditors as part of an effort to increase liquidity and turn around its business. The company was losing money and falling behind on supplier payments just months after its founding with the merger of Saks Fifth Avenue and Neiman Marcus in late 2024.

Results were “softer than expected due to continued inventory challenges in the third quarter,” a representative for Saks said in an emailed statement. “We expect our performance to improve throughout the holiday season and into 2026 and beyond.”

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