Shares of Oxford Industries (OXM) are plummeting 12.46% in pre-market trading on Friday following the company's disappointing outlook for fiscal year 2025 and a downgrade from KeyBanc. The owner of brands such as Tommy Bahama and Lilly Pulitzer is facing headwinds from softening consumer demand and the impact of tariffs on Chinese goods.

Oxford Industries provided guidance that fell short of analyst expectations. The company forecasts first-quarter sales between $375 million and $395 million, and full-year revenue ranging from $1.49 billion to $1.53 billion. These projections are below Wall Street's estimates, reflecting a cautious stance on consumer spending patterns. CEO Tom Chubb noted, "As we moved into January, we experienced a moderation in demand which we attribute to the recent pattern of consumers retreating when there isn't a reason to spend combined with a deterioration in consumer sentiment."

Adding to the company's challenges, Oxford Industries expects gross margins to decrease between 50 to 100 basis points in 2025, primarily due to the impact of tariffs and a lower proportion of full-priced direct-to-consumer sales. The company anticipates an unmitigated tariff impact of approximately $9 million to $10 million, or about $0.45 to $0.50 per share, on goods made in China. In response to these headwinds, KeyBanc has downgraded Oxford Industries to Sector Weight from Overweight, further pressuring the stock. As Oxford Industries grapples with these challenges, investors will be closely watching the company's strategies to navigate the uncertain retail landscape and mitigate the impact of tariffs in the coming quarters.