More Tariffs Analysis From Helen of Troy

Second-quarter earnings reports will start hitting the wires any day now, and analysts should expect a lot of talk about tariffs — specifically, how much money companies are expecting in tariff refunds, and how those refunds will flow through the financial statements.

Today we have a primer on how companies might disclose all that thanks to Helen of Troy ($HELE), maker of home healthcare and beauty products. Helen filed its latest quarterly report on Wednesday (its fiscal Q1 2027, for the quarter ending May 31) and had quite a bit to say about the tariff refunds it expects since the U.S. Supreme Court struck down the Trump Administration’s IEEPA tariffs earlier this year. 

Helen made the disclosures in the Management Discussion & Analysis of its 10-Q. For starters, the company said it paid $80.5 million in IEEPA tariffs in its fiscal 2026, which ran from March 1, 2025 to Feb. 28, 2026. That’s roughly 8.3 percent of the $970.6 million Helen reported as cost of goods sold for the year. 

Then came the good stuff. Helen said it submitted reimbursement claims worth $6 million to the Trump Administration in May 2026, during its fiscal Q1 2027. Of that amount… 

“As of May 31, 2026 we concluded that $1.9 million of tariff refunds were probable of being recovered and recorded a receivable within prepaids and other current assets, along with corresponding reductions to Cost of Goods Sold of $1.8 million and inventory of $0.1 million in our condensed consolidated financial statements.”

Ah ha! This is the first substantive disclosure we’ve seen not just of how much money a company expects in tariffs refunds; but also how those amounts will be reported in the financial statements. So we know that Helen… 

• Paid $80.5 million in tariffs in fiscal 2026

• Applied for $6 million in tariff refunds in fiscal Q1 2027

• Was certain enough about receiving $1.9 million in refunds that Helen booked them as accounts receivable;

• And matched the $1.9 million gain in accounts receivable to a reduction of $1.8 million in cost of goods sold and of $100,000 in inventory.

In one form or another, we’ll probably see similar accounting treatments from other companies too. For example, last week we noted that Nike ($NIKE) disclosed $986 million in “expected recovery” of tariffs — but Nike never expressly said what “expected recovery” means, or where that $986 million will show up in the 10-Q (which, as of July 8, Nike has yet to file). 

We kinda sorta assumed that Nike’s $986 million will show up as accounts receivable, but we still don’t know for sure. Now comes Helen of Troy proving that you can indeed get tariff refunds onto the financial statements in that manner. 

Even better, Helen also made additional disclosures about more tariff refunds it sought after its May 31 period-end: 

Subsequent to the first quarter of fiscal 2027, in June 2026, we submitted additional Phase 1 refund claims totaling $3.2 million related to our Beauty & Wellness segment. On June 29, 2026, CBP launched Phase 2 of the IEEPA refund claims process, which we are in the process of preparing. As of July 1, 2026, we received partial payments totaling $1.6 million for our Phase 1 tariff refunds and an immaterial amount of interest. 

Lots to unpack there. First, Helen says it has now received $1.6 million in “Phase 1” refunds, which were all part of the $1.9 million it booked as a receivable for the period that ended on May 31. 

Plus, Helen filed for an additional $3.2 million in Phase 1 tariffs after the May 31 period-close. How much of that sum will Helen be able to book as a receivable by the end of the current period? We don’t know, but we do know it can’t be more than the $3.2 million in total claims submitted. (It’s also possible that Uncle Sam will pay out the whole amount by the next earnings release.)

And finally, let’s not overlook that “Phase 2” refund window. Helen didn’t say how much it will seek as a refund in Phase 2 — but we do know the company paid $80.5 million in total IEEPA tariffs; and has already submitted claims worth $9.2 million (the $6 million submitted last quarter, and the additional $3.2 million submitted in the current quarter). So at most, Helen can only seek another $71.3 million. 

We should also note that in Helen’s earnings release the company does report a total benefit of $9.2 million from Phase 1 tariff refunds, just like we figured out in the above paragraph. Helen did not speculate about how much more in refunds it might get: “The company’s outlook… excludes any potential benefit from future refund phases due to the uncertainty surrounding the timing and collectability of those refunds.”

That’s how accounting for uncertain gains is supposed to work. A company can’t put down specific numbers until it’s confident in both the amount and the timing of when the gain will arrive. 

Regardless, gains from tariff refunds are coming. Helen just gave us a preview of how that might look like.