Duluth Holdings Reports Loss as Former CEO Returns Amid Cost-Cutting Plans

MOUNT HOREB, Wis. — Duluth Holdings Inc. announced significant changes following a troubling fiscal first quarter report that showed a loss of $15.3 million, or 45 cents per share. The Mount Horeb-based clothing retailer cited a revenue of $102.7 million, falling short of expectations by nearly $3 million.

In comparative terms, the same quarter last year saw a loss of $7.9 million, or 24 cents per share, with revenue of $116.7 million. This decline continues a trend as the company also faced losses of $1.3 million in the same quarter two years ago.

As the company navigates these challenges, Stephanie Pugliese has returned as president and CEO. She previously held the role from 2015 to 2019, during which time she significantly expanded the company’s brick-and-mortar presence. Pugliese replaces Sam Sato, who has retired after taking over her position in 2019.

Pugliese indicated that the current retail environment is pressuring profits, and she plans to implement decisive actions to simplify operations and enhance brand visibility. “Our operating performance over the past few years has been challenging as business complexity has increased. I will be conducting an in-depth review of our brand and product portfolio as we look to reinvigorate the Duluth brand,” she said in the earnings report.

The company is also preparing for price increases due to expected additional costs of $14 million because of tariffs. Pugliese clarified that their exposure to China is minimal, with less than 1% of current-year receipts affected.

In response to the ongoing revenue decline, Duluth has committed to reducing its product lineup by 20% by spring 2026 and aims to achieve $15 million in cuts. Pugliese voiced concerns about the competitive landscape and rising inventory levels impacting cash flow.

Despite these hurdles, she remains optimistic about reinstating profitable growth and believes targeted price adjustments and partnerships with vendors will help mitigate cost impacts.

Duluth Holdings, co-founded in 1993, operates more than 60 retail stores and has a well-established corporate headquarters in Mount Horeb. The company’s commitment to elevating its unique brand attributes and improving customer service remains a focal point for the future.