Zumiez (ZUMZ) Falls on Weak Results and Lower Outlook, But Is the Selloff Overdone?

On September 10, Zumiez Inc. (NASDAQ: ZUMZ ) reported weaker-than-expected results for its second quarter ended August 1, 2026, with the results falling short of Wall Street estimates and sending the stock lower.

For the second quarter of fiscal 2026, Zumiez Inc. (NASDAQ:ZUMZ) reported net sales of $209 million, down 2.5% year-over-year. Comparable sales declined 2.1%, with the weakness mainly coming from the US. Canada, Europe, and Australia all had positive comparable sales growth for the quarter. The company said it saw strong sales growth across its international markets, but softer domestic sales and lower foot traffic weighed on overall results.

The company also posted a net loss of $2.7 million, or $0.17 per share, compared with a net loss of $1.0 million, or $0.06 per share, in the second quarter of fiscal 2025.

Third-Quarter Outlook Disappoints, But Is It All Bad?

Zumiez Inc. (NASDAQ:ZUMZ) introduced third-quarter guidance, which also failed to provide much relief as it came in below Wall Street expectations. For the three months ending October 31, 2026, the company expects net sales of $222 million to $226 million, while earnings per share are projected to range from $0.00 to $0.10.

More importantly, management also lowered its broader outlook, saying fiscal 2026 sales are now expected to decline by low single digits and operating margin to fall slightly, versus its previous expectation for 50 to 100 basis points of operating-margin expansion.

Despite the weaker operating performance, Zumiez Inc. (NASDAQ:ZUMZ) continues to maintain an impressive financial position. As of August 1, 2026, the company had $97.3 million in cash and marketable securities, no debt, and an unused $25 million credit facility. The company also continued to return capital to shareholders as it repurchased 1.2 million shares for a total cost of $23.2 million during the second quarter.

For its international business, Zumiez Inc. (NASDAQ:ZUMZ) said it is focusing on a premium pricing strategy aimed at expanding margins and improving profitability. However, in the US, the company is working on merchandise assortment changes and customer experience initiatives in an effort to improve performance.

Hedge fund interest in the stock remained unchanged in the second quarter. According to Insider Monkey 's database, 16 hedge funds held positions in Zumiez Inc. (NASDAQ:ZUMZ) in the second quarter of 2026, the same number as in the first quarter.

Meanwhile, short interest stood at 10.99% of the company's float as of August 31, indicating a notable level of bearish positioning in the stock.