What Bath & Body Works, Inc. told the SEC could break it.

Tariffs were the primary driver of BBWI's 2025 merchandise margin rate decline; the Feb 2026 Supreme Court IEEPA invalidation created refund uncertainty, and the government immediately re-imposed tariffs under alternative authorities, sustaining exposure.

“Gross Profit dollars decreased due to the decline in the merchandise margin rate, primarily driven by tariffs, partially offset by lower Buying and Occupancy Expenses, which benefited from exiting a third-party fulfillment center in the first quarter of 2025.”

Goods imported from Chinese suppliers risk CBP detention under the UFLPA's presumptive ban on XUAR-linked inputs; BBWI lacks full visibility into sub-tier supply chains to confirm raw materials are XUAR-free.

“Although none of our Chinese suppliers are located in the XUAR, we do not currently have full visibility to the entirety of each supplier's separate sub-tier supply chains to be able to ensure that the raw materials or other inputs they use to manufacture their goods are not produced in the XUAR.”

BBWI relies heavily on third-party manufacturing and its own distribution facilities clustered in close proximity to its central Ohio headquarters, making it susceptible to local/regional disruptions.

“To achieve the necessary speed and agility in supply of our inventory, we rely heavily on third-party manufacturing facilities and our distribution facilities in close proximity to our headquarters in central Ohio.”

BBWI relies on a limited number of vendors; its largest (unnamed) vendor supplied ~12% of total merchandise purchases in 2025 and its five largest vendors ~40% combined.

“In 2025, our largest vendor supplied approximately 12% of our total merchandise purchases (on a dollar basis) and our largest five vendors in the aggregate supplied approximately 40% of our total merchandise purchases (on a dollar basis).”