Billabong has posted a $1.6 million loss for the half year.
The dramatic swing followed profit of $25.7 million in the previous period - its first profit in three years.
The surfwear brand blamed weaker than expected results in the Asia-Pacific region and losses in North America.
Gross margin erosion was also an issue due to the weaker Australian dollar and excess inventory following a strike at US ports in early 2015.
Earnings before interest, tax, depreciation and amortisation (EBITDA) fell 13% to $37.2 million.
However, the company said its three core brands remained strong.
Billabong sales were up 2.6%; Element grew 9.1% and RVCA recorded the strongest growth at 20.6%.
Total group sales were $561.9 million, up 7.6 per cent on the prior corresponding period.