Levi Strauss & Co. Reports Second-Quarter Results

Reported Net Revenues up 8%; Organic Net Revenues up 6% Operating Margin of 7.8%, up 35 BPS to PY; Adj EBIT Margin of 9.0%, up 70 BPS to PY Continuing Operations Diluted EPS of $0.24, up 20% YoY; Adj Diluted EPS of $0.28, up 27% YoY Raises Full Year 2026 Net Revenue and EPS Outlook; Increases Quarterly DividendSAN FRANCISCO--(BUSINESS WIRE)--Levi Strauss & Co. (NYSE: LEVI) today announced financial results for the second quarter ended May 31, 2026. “The Levi’s® brand is connecting with consumers around the world in more powerful ways than ever before, and our Q2 results are another proof point that our strategies are working and our team is executing,” said Michelle Gass, President and CEO of Levi Strauss & Co. “Our evolution into a DTC-first, denim lifestyle company—with a much larger addressable market—is translating to faster growth and higher profitability. While we are pleased with the progress, we are still in the early stages of our long-term growth journey, with more ways to win than ever before.” “We delivered another strong quarter driven by broad-based growth across markets, channels and categories,” said Harmit Singh, Chief Financial and Growth Officer of Levi Strauss & Co. “That growth translated into higher profitability through gross margin expansion and disciplined SG&A leverage, demonstrating the strength and scalability of our operating model. Given our strong first-half results, we are passing through our full Q2 beat and raising our full-year guidance. We are also increasing our dividend, reflecting confidence in the strength of our business, our cash flow generation and our ability to create long-term shareholder value.” Financial Highlights for the Second Quarter Net Revenues of $1.6 billion increased 8% on a reported basis and 6% on an organic basis versus Q2 2025. In the Americas, net revenues increased 9% on a reported basis and increased 7% on an organic basis. Within the Americas, the U.S. increased 5% on a reported basis. In Europe, net revenues increased 4% on a reported basis and decreased 1% on an organic basis entirely due to the impact of the company’s distribution center transition last year which resulted in a shift of shipments from Q1 2025 into Q2 2025. H1 2026 net revenues increased 14% on a reported basis and 5% on an organic basis. In Asia, net revenues increased 10% on a reported basis and 12% on an organic basis. Beyond Yoga® increased 16% on a reported and organic basis. DTC (Direct-to-Consumer) net revenues increased 11% on a reported basis and 8% on an organic basis. DTC growth on a reported basis reflected a 5% increase in the U.S., a 12% increase in Europe and a 12% increase in Asia. DTC growth on an organic basis reflected a 7% increase in Europe and a 12% increase in Asia. Net revenues from e-commerce grew 19% on a reported basis and 17% on an organic basis. DTC comparable sales growth was 6%. DTC comprised 51% of total net revenues in the second quarter. Wholesale net revenues increased 5% on a reported basis and 3% on an organic basis. Net Revenues Operating Income (loss) Three Months Ended Increase (Decrease) As Reported Increase (Decrease) Organic Net Revenues Three Months Ended Increase (Decrease) As Reported ($ millions) May 31, 2026 June 1, 2025 May 31, 2026 June 1, 2025 Americas $ 815 $ 748 9 % 7 % $ 164 $ 153 7 % Europe $ 420 $ 403 4 % (1 )% $ 89 $ 69 28 % Asia $ 284 $ 258 10 % 12 % $ 43 $ 30 44 % Beyond Yoga® $ 43 $ 37 16 % 16 % $ (2 ) $ (4 ) 47 % ___________ Operating margin was 7.8% in Q2 2026 compared to 7.5% in Q2 2025. Adjusted EBIT margin was 9.0% in Q2 2026 compared to 8.3% in Q2 2025. Gross margin expanded 10 basis points to 62.7%, driven by lower product costs and pricing actions. Tariffs and foreign exchange were a headwind in the quarter. Selling, general and administrative expenses (SG&A) were $843 million compared to $791 million in Q2 2025. Adjusted SG&A was up 6.5% to $838 million compared to $787 million last year primarily due to higher selling expenses and foreign exchange. Interest and other income (expense), net, which includes foreign exchange gains and losses, were zero in the aggregate in Q2 2026 and expenses of $6 million in the aggregate in Q2 2025. The effective income tax rate was 22.4%, compared to 22.3% in Q2 2025. Net income from continuing operations was $95 million compared to $80 million in Q2 2025. Adjusted net income was $110 million compared to $89 million in Q2 2025. Diluted earnings per share from continuing operations was $0.24 compared to $0.20 in Q2 2025. Adjusted diluted earnings per share was $0.28 compared to $0.22 in Q2 2025. Highlights include: Three Months Ended % Increase As Reported % Increase Organic Net Revenues Six Months Ended % Increase As Reported % Increase Organic Net Revenues ($ millions) May 31, 2026 June 1, 2025 May 31, 2026 June 1, 2025 Net revenues $ 1,562 $ 1,446 8% 6% $ 3,305 $ 2,973 11% 8% DTC Comparable Sales Growth 6% + * * * * * * Three Months Ended Increase As Reported Increase (Decrease) Constant Currency Six Months Ended Increase As Reported Increase (Decrease) Constant Currency ($ millions, except per-share amounts) May 31, 2026 June 1, 2025 May 31, 2026 June 1, 2025 Net income from continuing operations $ 95 $ 80 19% * $ 272 $ 220 24% * Adjusted net income $ 110 $ 89 24% 21% $ 277 $ 239 16% 12% Adjusted EBIT $ 141 $ 119 18% 13% $ 359 $ 323 11% 4% Diluted earnings per share from continuing operations $ 0.24 $ 0.20 4 ¢ * $ 0.69 $ 0.55 14 ¢ * Adjusted diluted earnings per share $ 0.28 $ 0.22 6 ¢ 5 ¢ $ 0.70 $ 0.60 10 ¢ 8 ¢ ____________________ * Not provided + For the three-month period ended June 1, 2025 the DTC Comparable Sales Growth was in the high-single digits. Additional information regarding DTC Comparable sales growth, a key metric, is provided at the end of this press release. Additional information regarding Adjusted SG&A, Adjusted EBIT, Adjusted EBIT margin, Adjusted net income, Adjusted diluted earnings per share, Adjusted free cash flow, as well as amounts presented on an organic net revenues basis and constant currency basis, all of which are non-GAAP financial measures, is provided at the end of this press release. Balance Sheet Review as of May 31, 2026 Cash and cash equivalents were $849 million, while total liquidity was approximately $1.8 billion. Total inventories decreased 7% on a dollar basis compared to Q2 2025. Shareholder Returns In the second quarter, the company returned $53.9 million in the form of dividends to shareholders, a 5% increase over prior year, representing a dividend of $0.14 per share. The $200 million accelerated share repurchase program launched in the first quarter of 2026 is expected to be settled in the third quarter. As of May 31, 2026, the company had $240 million remaining under its current share repurchase authorization, which has no expiration date. The company declared a dividend of $0.16 per share, a 14% increase over prior year, totaling approximately $62 million, payable in cash on August 5, 2026 to the holders of record of Class A common stock and Class B common stock at the close of business on July 22, 2026. Fiscal 2026 Guidance Guidance for 2026 is based on continuing operations, reflecting the Dockers® business being reported in discontinued operations. Guidance assumes U.S. tariffs on imports from China remain at 30% and Rest-of-World at 20%. The following guidance is provided for the year ending November 29, 2026: Metric Updated FY 2026 Guidance Previous FY 2026 Guidance Reported net revenues growth Raised to 7.0% to 7.5% 5.5% to 6.5% Organic net revenues growth Raised to 5.5% to 6.0% 4.5% to 5.5% Gross margin Raised to up 10 basis points to prior year Flat to slightly up to prior year Adjusted EBIT margin Expanding to 12%, up 60 basis points to prior year Expanding to approximately 12% Tax rate Approximately 23%, 2 points higher than prior year Approximately 23%, 2 points higher than prior year Adjusted diluted EPS Raised to $1.46 to $1.52 This includes an approximate $0.04 headwind from a higher tax rate $1.42 to $1.48 This includes an approximate $0.04 headwind from a higher tax rate This outlook also assumes no significant worsening of macro-economic pressures on the consumer, inflationary pressures, supply chain disruptions, potential tariffs or currency fluctuations. A reconciliation of non-GAAP forward looking information to the corresponding GAAP measures cannot be provided without unreasonable efforts due to the challenge in quantifying various items including but not limited to, the effects of foreign currency fluctuations, taxes, potential tariffs and rebates, and any future restructuring, restructuring-related, severance and other charges. Investor Conference Call To access the conference call, please pre-register on https://register-conf.media-server.com/register/BIaa579b9dc68f4e8b85f3a07e93aae5b8 and you will receive confirmation with dial-in details. A live webcast of the event can be accessed on https://edge.media-server.com/mmc/p/kopa6vxc. A replay of the webcast will be available on http://investors.levistrauss.com starting approximately two hours after the event and archived on the site for one quarter. About Levi Strauss & Co. Levi Strauss & Co. (LS&Co.) is one of the world's largest brand-name apparel companies and a global leader in jeanswear. The company designs and markets jeans, casual wear and related accessories for men, women and children under the Levi's®, Levi Strauss Signature™, and Beyond Yoga® brands. Its products are sold in approximately 120 countries worldwide through a combination of chain retailers, department stores, online sites, and a global footprint of approximately 3,300 retail stores and shop-in-shops. Levi Strauss & Co.'s reported 2025 net revenues were $6.3 billion. For more information, go to http://levistrauss.com, and for financial news and announcements go to http://investors.levistrauss.com. Forward-Looking StatementsRead the full story here

Levi Strauss & Co. Reports Second-Quarter Results

Autres actualités de l'entreprise