Levi Strauss Q2 net income gain overshadowed by tariff costs
Levi Strauss Q2 net income gain overshadowed by tariff costs
Overview
Apparel maker's Q2 revenue rose 8% yr/yr; adjusted net income beat analyst expectations
Adjusted EPS for Q2 rose 27% yr/yr to $0.28
Company raised full-year 2026 revenue and EPS outlook, increased quarterly dividend
Gross margin expands just 10 basis points as tariffs, FX offset pricing gains
Outlook
Levi Strauss raises FY 2026 reported net revenue growth outlook to 7.0%-7.5%
Company lifts FY 2026 adjusted diluted EPS forecast to $1.46-$1.52
Levi Strauss expects FY 2026 gross margin to rise 10 basis points from prior year
Result Drivers
DTC AND E-COMMERCE GROWTH - Co said direct-to-consumer and e-commerce sales grew strongly, with DTC net revenues up 11% and e-commerce up 19% yr/yr
GROSS MARGIN EXPANSION - Gross margin expanded 10 basis points to 62.7%, driven by lower product costs and pricing actions; tariffs and FX were a headwind
BEYOND YOGA GROWTH - Beyond Yoga net revenues increased 16% yr/yr
Company press release: ID:nBw6nwsvXa
Key Details
Metric | Beat/Miss | Actual | Consensus Estimate |
Q2 Adjusted EPS |
| $0.28 |
|
Q2 EPS |
| $0.24 |
|
Q2 Adjusted Net Income | Beat | $110 mln | $95.68 mln (12 Analysts) |
Q2 Gross Margin |
| 62.7% |
|
Q2 Adjusted EBIT Margin |
| 9% |
|
Q2 Operating Margin |
| 7.8% |
|
Analyst Coverage
The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 14 "strong buy" or "buy", 2 "hold" and no "sell" or "strong sell"
The average consensus recommendation for the apparel & accessories peer group is "buy"
Wall Street's median 12-month price target for Levi Strauss & Co is $27.00, about 9.5% above its July 7 closing price of $24.66
The stock recently traded at 15 times the next 12-month earnings vs. a P/E of 12 three months ago
For questions concerning the data in this report, contact Estimates.Support@lseg.com. For any other questions or feedback, contact reuters.support@thomsonreuters.com.
(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)