Levi Strauss lifts annual profit outlook on tariff refunds, holiday demand
LEVI•Levi Strauss raised its annual profit outlook after receiving $79 million in tariff refunds and said it expects strong holiday demand for premium denim. Quarterly revenue rose 4% to $1.61 billion, while adjusted earnings were 48 cents per share.
1. Outlook and refunds
Levi Strauss raised its annual organic revenue growth outlook to 6%, the upper end of its previous 5.5% to 6% forecast. The company received $79 million in third-quarter refunds for tariffs paid under the International Emergency Economic Powers Act and plans to redeploy about $60 million this year on promotions and marketing.
2. Quarterly results
Net revenue for the quarter ended August 30 rose 4% to $1.61 billion, close to estimates of $1.62 billion. Adjusted earnings were 48 cents per share, compared with analysts’ estimate of about 36 cents.
3. Sales trends
Comparable sales in Levi Strauss’ direct-to-consumer business were flat, and CEO Michelle Gass said the business fell short of expectations as U.S. sales declined while shoppers contended with higher inflation. The company’s women’s line was a bright spot, driven by demand for baggy jeans and its expansion into tops, skirts and dresses.
