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The U.S. has removed the de minimis exemption, a rule that previously allowed low-priced packages to enter the country without paying certain taxes or tariffs. This change is hitting the profits and growth of fast-fashion giants like Shein, which relied on that loophole to keep prices extremely low.
For Lands' End, this is a helpful shift in the competitive landscape. While the company still faces its own challenges with manufacturing costs, the removal of this tax break for rivals makes it harder for ultra-cheap competitors to undercut its prices. This could help stabilize the company's retail business as it shifts toward a model focused on licensing its brand.
Source: CNBC
Management has a solid track record of clearing the low bars set by analysts, beating earnings expectations in five of the last eight quarters despite falling revenue.
| Expectation | |
|---|---|
| EPS | $0.10 |
| Revenue | $301M |