The company now expects full-year revenue from continuing operations of $5.4bn to $5.5bn, down from its previous forecast of $6.0bn to $6.2bn.
Adjusted diluted earnings per share are expected to be $3.70 to $3.80, compared with the previous guidance of $4.65 to $4.75.
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Gildan also reduced its forecast for adjusted operating margin to approximately 20%, from 21.8%, and lowered its free cash flow outlook to $700m-$750m from approximately $1bn.
Gildan president and CEO Glenn Chamandy said: “Our results this quarter did not meet our expectations, reflecting a more subdued demand environment and near-term challenges in parts of our business across both Wholesale and Retail.
“The demand recovery we had anticipated has not materialised as expected, but our confidence in the underlying strength of the business and the long-term growth opportunity has not changed.”
Gildan’s Q3 metrics
In the quarter ended 27 September 2026, the apparel manufacturer’s revenue from continuing operations increased 61.1% year on year to $1.47bn, largely reflecting the acquisition of HanesBrands.
However, sales were below the company’s previous guidance of approximately $1.65bn.
On a pro forma basis, which includes HanesBrands in the prior-year comparison, revenue declined from $1.61bn.
Gildan attributed the shortfall to weaker-than-expected demand, an unfavourable product mix, lower selling prices, and product availability and service constraints.
Wholesale revenue decreased 6.8% year-on-year to $735m and was 10.8% below the pro forma prior-year figure. Retail sales reached $732m, compared with $122m a year earlier, reflecting the HanesBrands acquisition, but were 7% below the pro forma prior-year figure.
The company’s adjusted operating income rose to $396m from $211m, while the adjusted operating margin increased 380 basis points to 27%.
Gildan said the improvement reflected higher gross margins and synergies from integrating HanesBrands, partly offset by the acquired business’s historically higher selling, general and administrative costs.
Adjusted diluted earnings per share increased 54% to $1.54.
Net financial expenses rose by $17m to $61m, mainly because of higher borrowing related to the HanesBrands acquisition. The gross margin increased to 43.3% on an adjusted basis from 33.7% a year earlier.
For the first nine months of 2026, Gildan’s revenue from continuing operations rose 65.9% to $4.22bn.
Its adjusted operating income increased to $915m from $555m, although the adjusted operating margin fell 20 basis points to 21.7%.
Gildan completed the sale of its HanesBrands Australia business to BBFIT Investments on 26 October for an enterprise value of approximately A$700m, or about $490m. The company said it used the net proceeds to repay debt.
The integration of HanesBrands remains on track to deliver approximately $100m in synergies during 2026, with annual run-rate cost synergies expected to reach approximately $250m by the end of 2028.
Chamandy added: “We continued to make meaningful progress on the integration of HanesBrands and advance our synergy initiatives. In the current environment, our priorities remain clear: stay focused on what we can control, including leveraging the scale of our brands, our manufacturing network and our commercial capabilities, strengthen the foundations of our combined platform and continue to invest strategically in innovation and growth.”
