On January 13, 2026, the Law Offices of Frank R. Cruz announced the initiation of a class action lawsuit against Bath & Body Works, Inc. (NYSE: BBWI) in the United States District Court for the Southern District of Ohio. The complaint, titled *Reddy v. Bath & Body Works, Inc., et al.*, is filed on behalf of investors who acquired the company’s securities between June 4, 2024, and November 19, 2025. The lawsuit alleges violations of the Securities Exchange Act of 1934, specifically under Sections 10(b) and 20(a).

Investors affected by the alleged securities fraud have a 60-day window from this notice to move for lead plaintiff status in this action.

2. Background: Declining Financial Performance

The lawsuit follows a troubling financial trajectory for Bath & Body Works, marked by significant declines in earnings and revenue. On August 28, 2025, the company reported second-quarter financial results that fell short of expectations, revealing earnings per diluted share of $0.30—a staggering 55.8% decline year-over-year. The net income plummeted to $64 million, down 57.9% from the previous year. Following this announcement, the company's stock price dropped by $2.18, or 6.9%, closing at $29.36 per share.

The situation worsened when Bath & Body Works released third-quarter financial results on November 20, 2025. The results demonstrated a 1% decline in revenue, contradicting the company’s guidance for a 1-3% growth. Net income fell by 26% to $77 million, and the company slashed its full-year guidance for net sales from a previously anticipated growth of 1.5%-2.7% to a negative "high single digits." Furthermore, expected earnings per diluted share were revised down from the range of $3.28 to $3.53 to “at least $2.83.” On the day of this announcement, Bath & Body Works stock plummeted by $5.22, or 24.8%, closing at $15.82 per share.

3. Key Allegations in the Lawsuit

The class action complaint alleges that during the Class Period, Bath & Body Works and its executives made materially false and misleading statements, failing to disclose critical adverse facts regarding the company’s operational strategies and financial health. Key points of contention include:

Ineffective Business Strategy: The lawsuit claims that the company's strategy focused on "adjacencies, collaborations, and promotions" did not yield the expected growth in customer base or sales.

Obfuscation of Poor Performance: As the effectiveness of the strategy waned, Bath & Body Works allegedly relied on brand collaborations to mask underlying weak financial results.

Failure to Meet Financial Guidance: The complaint asserts that the company was unlikely to meet its previously issued financial guidance, a fact that was not disclosed to investors.

Misleading Positive Statements: Defendants are accused of making positive statements about the company’s business and prospects without a reasonable basis, further misleading investors.

4. Implications for Investors

The ongoing legal proceedings could have significant implications for both Bath & Body Works and its investors. The lawsuit highlights growing concerns about the company’s financial health and strategic direction, raising questions about accountability and transparency in corporate communications.

Investors who believe they have suffered losses related to Bath & Body Works securities during the specified Class Period are encouraged to participate in the lawsuit. They can submit claims to potentially recover their losses as the case unfolds.

As Bath & Body Works navigates this challenging period, market observers will be keenly watching how the company responds to the allegations and whether it can regain investor confidence in the wake of these serious claims.

Original press release