Levi Strauss Reports Robust Fiscal Q2 Earnings Amidst Strategic Shifts And Market Challenges
$LEVI
Levi Strauss & Co. (NYSE:LEVI), a global leader in the apparel industry renowned for its Levi’s® denim jeans, has announced its financial results for the second quarter ended May 26, 2024. The company reported a revenue of $1.44 billion, representing an 8% increase on a reported basis and a 9% rise in constant-currency terms compared to the same period last year. Net income reached $18 million, a notable improvement from the $2 million loss reported a year ago. Adjusted diluted earnings per share reached $0.16, exceeding expectations.
The robust performance was driven by the Levi’s® brand’s substantial market presence and innovative product lines, which continue to capture a considerable market share. Despite adjustments related to wholesale shipments and the exit of the Denizen® business, revenue from the Americas exhibited a 17% surge on a reported basis and a 16% increase in constant currency. In contrast, the European market exhibited a modest decline of 2% in revenue, demonstrating a sequential improvement from the preceding quarter’s performance. Direct-to-consumer (DTC) channels demonstrated remarkable growth, with reported revenues increasing by 8% and constant currency revenues rising by 11%. This expansion was driven by a 12% increase in the United States and a 7% growth in Europe.
In response to market dynamics, Levi Strauss has initiated strategic changes, including a transition in its distribution and logistics model from a primarily owned-and-operated network to a balanced approach involving third-party providers. The objective of this shift is to enhance operational efficiency and global customer service capabilities. In the future, the company reaffirmed its fiscal 2024 guidance, indicating that revenue is expected to grow by 1-3% year-over-year. Additionally, adjusted diluted EPS is projected to be between $1.17 and $1.27.
Levi Strauss’s robust quarter and strategic adjustments underscore the company’s adaptability and commitment to growth in the face of market fluctuations. The industry maintains a commitment to innovation, the expansion of its product range, and the reinforcement of its position as a leader in the apparel industry. As the company continues to evolve, its objective is to enhance shareholder value through the implementation of strategic initiatives and the prudent management of its financial resources.
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