Vestis Corporation (VSTS) saw its stock drop 5.33% in after-hours trading following the release of its mixed fourth-quarter earnings report and the announcement of a strategic restructuring plan. The company reported adjusted earnings of $0.03 per share, missing the analyst consensus estimate of $0.06, while revenue of $712.011 million surpassed expectations.

The earnings decline was attributed to higher costs and operational challenges, with the company also revealing a multi-year restructuring plan expected to incur costs of $25-30 million. Vestis aims to achieve $75 million in annual savings by 2026 through this transformation, which focuses on commercial and operational excellence. However, investors reacted negatively to the uncertainty surrounding the plan and the weaker-than-expected earnings performance.

For the full year, Vestis reported a net loss of $40.2 million, a significant downturn from the prior year's profit. The company's outlook for fiscal 2026 revenue, projected to be flat or down 2%, further contributed to the after-hours sell-off.