UBS’s latest benchmarking work finds artificial intelligence use is far more widespread among U.S. softlines retailers than many market participants have appreciated. According to the firm, 43 of the 45 companies in its softlines coverage universe now report some level of AI deployment, a marked change from the apparent hesitancy UBS observed just over a year earlier.
The bank notes that discussions with both public and private companies indicate a high degree of sensitivity around announcing AI initiatives. Firms appear to regard certain AI capabilities as strategic assets, and consequently are cautious about public disclosure. UBS contrasts this posture with impressions from its October 2023 Generative AI conference, when many softlines operators appeared reluctant to accelerate AI rollouts.
UBS lays out a constructive case for the sector tied to AI-driven operational improvements. The firm says enhanced AI adoption has the potential to materially boost efficiency, which in turn could raise sales, improve margins and increase return on invested capital. UBS cites specific companies - including Ralph Lauren and Tapestry - as examples where AI deployment may have already helped fuel recent strong results. The bank adds that should these benefits propagate across a wider set of retailers, consensus earnings forecasts could be revised upward and price-to-earnings multiples could expand.
UBS’s top-ranked U.S. softlines selections include a mix of mass-market, mid-market and premium brands. The firm highlights the following names in its sector rankings:
- Gildan Activewear - UBS assigns a Buy stance to this softline apparel company as the sector advances AI-driven operational gains.
- Levi Strauss & Co - Included on UBS’s list amid accelerating AI adoption industry-wide. The denim maker most recently reported fourth-quarter 2025 earnings and revenue that exceeded analyst expectations. Separately, Jefferies has initiated coverage on the company with a Buy rating.
- On Holding - The athletic footwear and apparel group appears on UBS’s sector roster. On Holding AG disclosed the appointment of Frank Sluis as Chief Financial Officer, effective May 1, 2026. Multiple sell-side firms, among them UBS and Stifel, have reiterated Buy or Outperform ratings on the company.
- PVH Corp - The owner of brands including Calvin Klein and Tommy Hilfiger is a UBS pick. PVH announced a collaboration with OpenAI to introduce AI capabilities across its operations and reported third-quarter 2025 earnings per share that topped expectations.
- Ralph Lauren - UBS flags the luxury apparel house as another example of a business potentially benefiting from AI deployment. Ralph Lauren posted strong fiscal third-quarter 2026 results, with both earnings per share and revenue surpassing analyst forecasts.
- Signet Jewelers - The jewelry retailer ranks sixth in UBS’s softlines coverage. Signet received several updated analyst assessments, including an initiation of coverage from Goldman Sachs with a Neutral rating and a price-target increase from Jefferies, which kept a Buy stance.
- Vince Holding Corp - The contemporary fashion label reported third-quarter 2025 results that beat analyst expectations for both earnings per share and revenue.
Overall, UBS interprets the rapid diffusion of AI across the softlines cohort as a signal that management teams expect meaningful financial returns from their technology investments. The bank’s view is that these initiatives could lift sector fundamentals if implementation continues to scale.
UBS’s analysis stresses two concomitant features of the current landscape: first, the near-universal presence of AI in the companies it covers; and second, company-level reluctance to broadly disclose the specifics of those AI programs. Those two elements together, UBS argues, could mean investors have been underestimating both the scope of AI activity and its potential earnings impact.
For investors and market participants focused on the retail and consumer discretionary sectors, UBS’s findings suggest attention should extend beyond visible technology investments to the less-publicized AI efforts that may quietly improve inventory management, personalization, forecasting and other operational functions.
Note: The reporting here follows UBS’s benchmarking and public company disclosures as described above. The article does not add or infer facts beyond those presented in UBS’s analysis and related company announcements.