Express did more than $2 billion in revenue and more than $140 million in net income in 2011. It filed for bankruptcy in 2024, the mall landlords bought the brand, and the public shareholders got nothing.
The brand surviving and the shareholder surviving are two different things, and the two hosts of The Canadian Investor built a whole episode on the gap between them — three brands that never came back, and three that did.
"The fashion graveyard is filled with companies that have gone bankrupt."
Both hosts own fashion stocks and say so on air — one has been trimming an Aritzia position for years and still holds Canada Goose — and they pulled the examples out of decades-old financial statements themselves.
The full episode is covered here so you can skip it. 54 minutes of audio, 22 minutes of reading.
Here are the 14 lessons that matter.
🎙️ Hosts: Simon Belanger and Dan Kent, the two co-hosts of The Canadian Investor, the Canadian Investor Podcast Network's show on individual stocks and self-directed investing
📰 Published: 14 September 2026 on the show's own podcast feed
🔴 YouTube | 🟣 Apple Podcasts | 🔗 Episode page | ⏱️ 54 min | ✅ Time saved: 32 min
Key Takeaways
Express, Quiksilver and Aeropostale all still sell clothes today, and all three wiped out their public shareholders
Two of the three were bought out of bankruptcy by the mall owners who were about to lose them as tenants
A fashion brand's only competitive advantage is that the customer currently likes it
There are no switching costs, no contracts and no reason a shopper cannot simply stop
Fast growth is what eventually breaks a fashion company, not slow growth
More stores means more inventory, which means bigger public markdowns when one season misses
Discounting is self-reinforcing: once shoppers learn to wait for a sale, they keep waiting
The hosts named Gap as the brand that spent years training customers to hold out for 50% to 60% off
Abercrombie & Fitch took 12 years to get back to the sales it did in the year to February 2013
It got there by deleting the brand teenagers knew, not by returning to it
Crocs nearly failed in 2008 and recovered by making itself weirder rather than more normal
Revenue fell 24% in two years and the auditor questioned whether the company could continue
Both hosts now treat a fashion position as something to trim on the way up, not to hold
One of them sold half his Canada Goose position near the 2017 peak on no more logic than being up 250%
On Lululemon, the hosts would rather be late than early
Their stated preference is to give up the first 15% to 25% of a recovery in exchange for seeing evidence of one
1. Fashion's Hardest Job
The episode was prompted by Lululemon's quarter, and it opened with an argument that fashion is structurally the hardest place on the stock market to run a company.
The starting claim was about management, not about brands. "So the first one I would say is management has the hardest job on the markets."
The contrast the host used is a railway. A railway does not need to keep inventing what it sells: you put freight on the train and the train goes, and operational improvement is the only lever management has. A fashion team has to keep designing, keep changing and keep guessing
The comparison that carries it: "If you think of fashion as an exchange-traded ETF it would be the most actively managed fund you can think of pretty much."
The consequence is that one decision can do permanent damage. "So one slip up from management can have pretty devastating consequences." The list given was the wrong brand deal, the wrong product assortment, the wrong partner
The wider point is a forecasting one. Railways, grocers and similar businesses can be modeled because human behavior in them barely moves. What someone wants to wear in a year cannot be modeled at all
The host making the case owns the stocks he is describing, and said so before making it: he holds Aritzia, has held it a long time, has owned Lululemon in the past, and owns Canada Goose
2. There Is No Moat
The second reason is the one the episode's own trailer opened on, and it is the shortest.
The only durable asset a clothing company has is that people currently want its clothes. "There's absolutely zero switching costs in fashion. There's no feeling of necessity."
Nothing stops a customer leaving. "There's pretty much zero friction to switching." A shopper who stops liking a product puts it in the closet and never buys the label again
Against that, the railway's moat is physical: infrastructure that is close to impossible to replicate and will probably never be replicated, and that cannot be taken away overnight
A brand is not built once and left alone. Once it exists, the hosts argued, management's job is not to add to the moat but to avoid destroying it — and plenty of them do. Nike was named as a company doing exactly that right now
Price competition attacks the same weak point. On Lululemon's leggings the hosts pointed to cheaper and probably lower-quality alternatives, including a Costco version that they said drew a lawsuit from Lululemon. The brand has to be strong enough that a shopper pays more anyway, and the hosts said the whole thing falls apart as soon as that does
3. The Growth Paradox
This is the section that does the most work in the episode, because it explains why the good years cause the bad ones.
The hosts described a trap rather than a mistake. A small fashion company carries little inventory, can move quickly on promotions, and is not yet big enough for a bad season to be seen by everybody. Growth removes all three protections at once — store count rises to meet demand, inventory rises with it, and the damage from a brand stumble is amplified rather than absorbed.
The same bad season costs a small company and a large one very different amounts. A small brand marks down a weak fall line and eventually clears it. A large one has more product, more stores and more customers, so "your markdowns are more publicly displayed"
The paradox, in the hosts' own framing: the smaller and more nimble a fashion company is, the better it is run; the faster and more expansively it grows, the better the stock does. Both are true at once, which is what makes the position hard to hold
The mechanism is margin, not sentiment. Faster growth erodes pricing power, because one or two bad years is all it takes for customers either to lose interest or to expect the clothes for less — while input costs stay where they were
Two things move demand, and only two. "It's usually two things, right, that affects demand. It's either customer preference or competition or a combination of both." Everything else — too many stores, too much inventory — amplifies a mistake that one of those two started
On Express specifically, the hosts checked the store count and found expansion was not the problem: the company opened some stores and downsized others. Preference and competition did the damage
4. Trained to Wait for Sales
The markdown spiral got its own treatment, and the hosts put the listener in it rather than describing it.
Customers are conditioned, and they know it. "As soon as you see something that is not full price or something is marked down a lot, you're just trained to wait for that markdown."
Lululemon's own clearance section is the example. The company's discounted range is branded "we made too much", and the hosts' point is that a shopper looking at a new full-price item and a similar marked-down one will usually take the discount and live with the wrong color
Once it starts it does not stop by itself. Marking down a large volume of product trains the customer base to expect markdowns permanently, and the effect ripples into every new line because nobody buys those at full price either
Gap is the long-running case, and the hosts think it is finally turning. For years the pattern was to wait for a 50% to 60% sale across Gap, Banana Republic or Old Navy. They rate the children's ranges as genuinely good product and see the Gap brand slowly recovering
The read-across to Lululemon is a time estimate rather than a verdict: getting out of the markdown cycle takes years, and only then does the work of changing brand sentiment begin
5. New Generations Reject It
The next argument is the one the host flagged as partly anecdotal and said he believes anyway.
The claim is that clothing is identity, so each cohort has to differentiate itself from the last. "So, I think that's another reason why a lot of these companies have not succeeded over the long term."
The supporting intuition is personal: "So if we go back to when we were younger, I would imagine a lot of us did not aspire to be like the generations older than us." What was popular then would be actively rejected now
Lululemon is offered as the live test case. Everybody wore it in the host's high-school and early-twenties years, and he is not close enough to the brand to know whether younger shoppers are avoiding it for precisely that reason
Converse is the century-long version of the cycle. The brand has been in and out of favor repeatedly, and right now it is out: "Just to get back to the Converse brand, so revenues are actually the lowest they've been in more than 12 years." Nike is reporting the worst Converse results in many years
Champion is the same cycle running the other way. It was the cheap brand you wore to school; it is now being worn deliberately, and one of the hosts was wearing a Champion hoodie while saying so
The hosts' exception is scarcity-based luxury, where supply is deliberately limited rather than large — those brands hold on longer than a Nike or a Lululemon
The recovery mechanism they expect is not strategic. In a few years an influencer picks the brand up and it goes through the roof, which is how several of the turnarounds later in the episode actually started
6. The Exit You Cannot Time
The last of the structural arguments is about selling, and it is where the hosts disagreed most.
The claim is that a clean exit needs luck. One host sold half his Canada Goose position around the 2017 peak with, by his own account, no real logic behind it: he was up 250% and decided to book something
Waiting for visible damage does not work, because the market prices it first. "Like the market's going to detect that and dump the stock well before."
His worked example is the stock he still owns. On Aritzia he is bullish and still expects a single mediocre quarter to take 25% to 30% off the price after earnings — and he pointed to Groupe Dynamite falling 20% to 25% after a soft quarter following a big run
So the rule he has adopted is mechanical: "That's kind of why I've learned in the space to always take profits off the table." He has been trimming Aritzia for years without adding, letting the position fund its own trims
"This area of the market is absolutely vicious." One earnings or guidance miss sends a momentum name in this sector to the floor
The other host pushed back, and the disagreement is about entry price rather than about selling. His view is that a first warning sign usually still leaves time: you will not get the top, but a long-held position can still be exited at a good profit. Lululemon's chart is his evidence — the Americas comparable-sales line went from 7% growth in the January 2024 quarter to flat, then negative, with a visible post-earnings drop around April 2024
The counter to the counter is when people actually buy. Nobody asked about Aritzia at $25; the questions started when it broke $100. "But most people get into these companies well after the huge runup in popularity has been realized, I guess you could say." A holder who bought near the top has no cushion to absorb one bad quarter
7. Lululemon's Second Cut
Before the case studies, the hosts recapped the quarter that prompted the episode.
The full-year guidance has now been cut twice in two quarters. "So they went from guiding for I think it was 3 to 4% sales increase for the full year reduced it to flat and then reduced it to a decline of 5 to 7%. So that's as quick of a really negative turn as you can get."
None of it came out of nowhere. The company has been struggling for a couple of years and removed its chief product officer roughly two years ago, having concluded the product was not resonating with customers as well as it had hoped
The question the hosts set out to answer was whether a brand in this position can recover at all. Their answer is yes, with the caveat that "There is a big cemetery of companies that have not turned it around"
The structure of the rest of the episode follows from that: three companies that never recovered, then three that did, chosen for how closely they map onto Lululemon's problem
8. Express and the Malls
The first failure is the one the hosts knew personally, and it is also the clearest illustration of who ends up owning a dead brand.
Express sold work-casual and going-out clothes to people in their twenties and thirties, at a price point that was neither cheap nor expensive — affordable for that group
The business was a good one before it wasn't. In 2011 it did more than $2 billion in revenue and more than $140 million in net income, on operating margins of 13%
The margin collapse is the whole story. Operating margins fell to 4.7% by 2016 and below 1.5% in 2017 and 2018 — while sales stayed fairly constant
Fast fashion did it. H&M and Zara took share because Express was not a luxury brand, and a younger shopper reasoned that the clothes looked as good for half the price even if the fabric would not survive ten washes
That started the discounting cycle, and COVID finished the public company. Express filed for bankruptcy in 2024
The buyer was a venture owned by the landlords — Brookfield Property Partners and Simon Property Group among others — and the hosts explained the logic bluntly. "If they own 50 malls and Express has a boutique or shop that they're leasing in 40 of those malls, what the hell happens if Express doesn't get bought?" A tenant in bankruptcy is a tenant that stops paying
The brand still exists and still sells clothes. The shareholders of the public company got nothing — the distinction the hosts kept returning to all episode
The lesson they drew is about trimming, not about Express. "Maybe you think the brand has like years of growth ahead, but these things can turn around on a dime." And: "And that's a lot of what you'll see with these companies is things were going great until they weren't."
9. Quiksilver's Ski Detour
The second failure adds two ingredients Express did not have: a bad acquisition and a debt load.
Quiksilver was a surf and snowboard clothing brand, and its stuff is still readily available online today under other ownership
The 2005 mistake was buying a French alpine-ski equipment maker for $320 million. The reasoning was adjacency — snowboards to skis — and it did not work. The company sold the business three years later for half what it paid, to a group that the host believed included the ski brand's former chief executive
It also expanded aggressively while the brand was hot in the late 2000s, which is the same pattern as the growth-paradox section
Revenue across the Quiksilver portfolio, including DC Shoes and Roxy, fell more than 26% between 2013 and 2015. High fixed costs, high debt and falling sales together produced the 2015 bankruptcy
Oaktree Capital took it over, and the brand now sits with Authentic Brands Group under the Boardriders name, which is what Quiksilver was renamed a year or two after Oaktree bought it
Buying a clothing company out of bankruptcy is an easier business than running one into it, the hosts noted — the acquirer gets a very good price on everything
10. Aeropostale's Logo Problem
The third failure is the one with the cleanest single cause, and the company said what it was in its own filings.
Aeropostale sold to teenagers at affordable prices, and at its 2010 and 2011 peak it passed $2 billion in sales
The company's own 2015 annual report named the cause, and the host quoted it: a "shift in customer demand away from logo based products". Aeropostale's offering was heavily logo-based
By then sales had fallen to $1.8 billion, and the income statement had turned over completely: from $60 million of operating income in 2013 to a $213 million operating loss in 2015
The competition was the same set as Express faced, plus two more. H&M, Zara and Uniqlo, and Forever 21 — which the hosts noted also went bankrupt, as a private company
It expanded into the warning signs. Sales were plateauing and preferences were visibly shifting, and the company opened stores anyway
Bankruptcy came in 2016, and the landlords bought it again — a consortium including Simon Property Group and General Growth Properties, for the same reason they bought Express: hundreds of Aeropostale stores sat in their malls. The brand still exists; the shareholders did not survive it
11. Abercrombie's 12 Years
The first comeback is the one that required deleting the brand rather than restoring it.
The 2000s version of the company was built on exclusion: dark stores, heavy perfume, shirtless male models at the door, and a teenage target market. It was extremely popular and it became controversial
Fast fashion hit it as well, and by 2016 sales had fallen to $3.3 billion
The turnaround started in 2017 when Fran Horowitz became chief executive. "She essentially killed the old brand." The models, the nightclub lighting and the sexualized marketing all went
The customer was changed deliberately, from teenagers to young adults and people in their twenties and thirties, and the product moved to casual wear, work clothes, tailored clothing and denim. Stores became brighter and more welcoming, and social media worked in the company's favor
Recovery was slow and then fast. Revenue sat between roughly $3.5 billion and $3.8 billion from 2018 to 2023, with a $3.1 billion low in 2021 that the hosts attributed to COVID. It took off in 2024, and trailing-twelve-month revenue has now reached $5.3 billion
The number the hosts wanted listeners to hold is how long it took. "You have 2013, February 2013 revenue of 4.5 billion." And: "They didn't get back to that for 12 years." The company finally eclipsed that level in February 2025
That is the read-across to Lululemon they care about. One host noted that Michael Burry owns the stock and is fairly bullish on it, and said that even if the turnaround works it could be three, four or five years
12. Victoria's Secret Pivots
The second comeback is the messiest, because the company changed direction twice.
The stock has already done the work. "If you're looking at the last three years especially, the stock is up 339%." It is in a drawdown now, and the five-year picture is choppier
The brand peaked near $8 billion of revenue by 2016 on supermodels, exclusivity, sex appeal and an annual fashion show with the wing costumes. One host's wife watched them, usually in December
Then the customer changed. Demand moved toward body positivity, comfort and athleisure, and the brand's positioning eroded
The company added its own errors, exiting the swimsuit category while running into unexpected difficulty in bras and lingerie
The ownership history explains the missing data. L Brands wanted to cut its exposure and tried to sell a stake; COVID killed the sale, and Victoria's Secret was spun out as its own public company in 2021, which is why the reported history does not run far back
The 2023 move was back toward the original brand, in a softer register — a hybrid rather than a reversal, keeping some of what made it popular without the same emphasis. The fashion shows, cancelled from 2019 to 2022, returned in 2023 under a different concept and went back to the traditional format in 2024 and 2025
Revenue has not returned to the $8 billion peak but has risen three years running, and 2026 guidance calls for another 3% to 4%
One host raised GLP-1 drugs as a possible tailwind — women losing weight feeling more inclined to consider the brand — while saying he had not seen it addressed on the company's recent call. The other said he does not follow the company at all
13. Crocs Doubled Down
The third comeback is the one the hosts called the wildest, and the only one that nearly died first.
The first boom was violent. "So Crocs went from just 109 million in revenue in 2005 to 847 million in 2007." Net income reached $168 million in 2007
Then the company built for demand that reversed. It invested heavily in manufacturing capacity, warehousing, inventory, international operations, stores and additional products, and demand turned in 2008 — partly the financial crisis, partly the clog simply going out of fashion
"Revenue declined 24% in the span of two years", and the auditor flagged substantial doubt about the company's ability to continue as a going concern. The hosts translated the phrase for listeners: the auditor was not sure the business could keep operating
Survival came from cuts. Crocs closed manufacturing, cut staff and reduced expenses, and for years afterward tried to become a broader footwear company rather than a clog company — which stabilized the business without producing another growth cycle
The actual turnaround is credited to Andrew Rees, who joined in 2014, became chief executive in 2017 and still holds the job. He simplified again, cut more costs and reduced the store count
And then did the opposite of what the previous decade had tried. "Instead of trying to make Crocs less weird, they just doubled down on just the weirdness and just the fact that it was that classic clog at the center of the brand."
The tools were scarcity, customization, social media and celebrity collaborations — Post Malone and Justin Bieber were the two named. Sales took off from around 2020 and 2021, from a roughly ten-year low in 2017: "Sales have pretty much quadrupled since then."
The customization is a second sale. Jibbitz, the charms that clip into the holes, get bought repeatedly and in new designs, which one host sees on family members constantly
14. The Lululemon Playbook
The three comebacks took three different routes, and the hosts were explicit that there is no single template.
Abercrombie went somewhere new, Victoria's Secret went partway back, and Crocs went all the way back. All three worked, which is why the hosts declined to prescribe one
Their own preference for Lululemon is the Crocs route: simplify. The company has added backpacks, fanny packs, men's and women's ranges, dresses and casual wear, and has moved well outside the athleisure and yoga offering it was built on
The store program is the specific disagreement they have with management. Lululemon is still opening stores and was asked about it on the call; the answer was that it will keep going until 2027 while optimizing locations. The hosts' view: "There's no sense in trying to save them by opening new stores."
Debt is what killed the failures, and Lululemon does not have that problem. A heavy debt load was a common factor in the bankruptcies; Lululemon has a good balance sheet and generates a great deal of cash. It is also still buying back stock, and one host would rather that money went into fixing the business than into repurchases at a low price
The demographic instruction is to go younger. One host's sense is that under-25s are not shopping there and that the customer is now 30 to 60 — which is exactly the pattern from the new-generations section, and a business with no incoming cohort
On the new chief executive, the hosts split the difference: she comes from Nike, which has not been a good example for four or five years, but she deserves a chance
The position they would take is a late one. "It's a company that I'd rather be a bit too late on." And: "So, I'd rather wait until I start seeing things slowly turning around than going in now with the hopes that they'll turn it around."
They accept the cost of that explicitly. Buying now would probably be cheaper, but the risk of no turnaround is higher, and one host put the trade plainly: "I’d rather start seeing things slowly turn it around and then investing even if it means I’m missing out on the first 15, 20, 25% gains than being too early." The other agreed: another slow quarter and another guidance cut takes the stock down again
Bonus Insights
The correction that opened the Express segment had nothing to do with retail. The mall in Syracuse where one host shopped on Black Friday was Carousel Mall and is now Destiny USA — and he volunteered the clarification: "It was not a Trump thing in case people were wondering."
Adidas came up as a turnaround the episode did not have time for, covering the write-down of Kanye West-branded inventory and a shoe that came back into style, which the host thought was the Samba. His verdict on the company is mixed: some recovery in the last couple of years, and the stock still down a lot
The Crocs digression ended in an accidental product discovery. One host said he owned the golf version of the style being shown on screen without realizing the company made golf shoes
The hosts read a company highlighting an unusual income-statement line as a warning sign, a habit they applied to Lululemon's disclosure the same way they had applied it elsewhere
The closing instruction was not to avoid the sector. Invest in fashion if you want to, but there is nothing wrong with taking profits on a large gain, and "it's usually not a buy and hold forever"
The reason is the same one the episode opened with: "It's something you want to keep a close eye on because once consumer sentiments and preferences start to shift, it's very hard to get back on track"
The hosts' bottom line is that a fashion brand and a fashion shareholder are two different investments: Express, Quiksilver and Aeropostale are all still selling clothes today and none of their public shareholders got any of it, which is why both hosts trim on the way up and would rather buy Lululemon's recovery late than early.
Products, Companies & Tools Mentioned
Lululemon (The reason the episode exists: full-year guidance cut twice in two quarters, from up 3-4% to flat to down 5-7%, with a chief product officer removed two years ago)
Express (More than $2B of revenue and $140M of net income in 2011, operating margins down from 13% to below 1.5%, bankrupt in 2024, shareholders wiped out)
Quiksilver, DC Shoes and Roxy (Portfolio revenue down more than 26% between 2013 and 2015; bankrupt in 2015 after a $320M ski acquisition sold three years later for half)
Aeropostale (Peaked above $2B in 2010-11, blamed a shift in customer demand away from logo-based products in its own 2015 annual report, bankrupt in 2016)
Abercrombie & Fitch (The comeback that deleted the old brand under Fran Horowitz, took 12 years to regain its February 2013 sales, and now does $5.3B trailing revenue)
Victoria's Secret (Peaked near $8B in 2016, pivoted away from its original positioning and partway back in 2023, stock up 339% over three years)
Crocs (Revenue from $109M in 2005 to $847M in 2007, a going-concern warning in 2008-09, and a recovery built on doubling down on the classic clog)
Aritzia, Canada Goose and Groupe Dynamite (The Canadian names one host owns or tracks — and the evidence for his rule that one soft quarter takes 20% to 30% off a fashion stock)
Nike and Converse (The hosts' live example of a brand blowing up its own moat, with Converse revenue at its lowest in more than 12 years)
Gap, Banana Republic and Old Navy (Years of 50-60% sales trained customers to wait, and the hosts think the Gap brand is finally turning)
H&M, Zara, Uniqlo and Forever 21 (The fast-fashion set that took share from both Express and Aeropostale; Forever 21 went bankrupt itself, as a private company)
Champion (The cheap school brand now being worn deliberately — the generational cycle running in the other direction)
Costco (Made a competing legging at a fraction of the price, which the hosts said drew a Lululemon lawsuit)
Simon Property Group and Brookfield Property Partners (The mall landlords who bought Express and Aeropostale out of bankruptcy rather than lose hundreds of tenants)
Oaktree Capital, Authentic Brands Group and Boardriders (Who ended up owning Quiksilver, and the name it trades under now)
Adidas (The turnaround the hosts did not have time for: a Kanye West inventory write-down and a shoe back in style, which one host thought was the Samba)
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