The men’s big and tall industry continues to be under strain.
Destination XL Group, the country’s largest retailer of men’s big and tall merchandise, fell further into the red in the fourth quarter, posting a net loss of $29.6 million, or 54 cents a diluted share, up significantly from the $1.3 million loss in the fourth quarter of fiscal 2024. Sales were also down in the period ending Jan. 31, dropping 6 percent to $112.1 million from $119.2 million the prior year. Comparable-store sales fell 7.3 percent with brick-and-mortar sales down 8.6 percent and online volume down 4.3 percent.
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The Canton, Mass.-based retailer blamed the weather and cautious consumer sentiment for the poor showing but said that business has begun to improve so far this year.
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“Our fourth-quarter comparable sales through the holiday season and into early January were down 5.8 percent, an improvement from the rest of the year,” said Harvey Kanter, president and chief executive officer. “That momentum was interrupted by a severe arctic weather event that impacted much of the country during the final two weeks of January, which created widespread disruption across our nearly 300-store fleet, materially pressured our quarterly results, and reduced our quarterly comparable sales. However, I am pleased to report that 2026 is off to a better start with comparable sales for the month of February down 1.3 percent and early March appears to be following a similar trend.”
He added that the big and tall customer shopped less frequently last year and prioritized “essentials and lower price points.” In response, the company worked to manage expenses and inventories to protect margins. It also expanded its private label assortment, heightened its focus on “value-driven” national brands, launched a new loyalty program and rolled out its proprietary FitMap technology to more stores across the chain. The digital sizing platform is currently offered in 188 stores and online.
“As a result, we exited fiscal 2025 with a clean inventory position, no debt, and approximately $28.8 million in cash and investments,” Kanter said. “We believe that balance sheet strength gives us flexibility and resilience as we intend to continue to execute with discipline in a challenging environment.”
The situation may change later this year when DXL’s planned merger with FullBeauty Brands comes to fruition. As reported, the retailer last quarter said that it would merge with FBB Holdings Inc., an inclusive-size retailer for men and women that operates under the FullBeauty and KingSize names. The combined business will have annual sales of about $1.2 billion.
Kanter said Thursday that the transaction is on track to close in the second quarter. Costs for the transaction in the fourth quarter were $3.6 million and $4.2 million in the year.
Kanter added that over the next two years, he projects that private brand penetration will increase from 57 percent of total sales at the start of fiscal 2025 to more than 60 percent in fiscal 2026 and over 65 percent the next year. “We believe that the strength of our assortment, enhanced storytelling, and targeted marketing efforts will drive greater customer loyalty and position our private brands as a primary reason customers choose DXL.”
In the year, the net loss was $35.9 million, or 66 cents a diluted share, compared to net income of $3.1 million, or 5 cents a share in fiscal 2024. Total sales decreased 6.9 percent to $435 million from $467 million in fiscal 2024 with comparable stores down 8.4 percent, with stores down 6.9 percent and the direct business down 11.8 percent.
Destination XL operates 295 full-price and outlet stores under the DXL and Casual Male nameplates.