Jan 28 - Levi Strauss exceeded Wall Street estimates for its fiscal fourth quarter, delivering revenue and profit results that outperformed analyst expectations even as the company navigates higher U.S. import tariffs and softer consumer spending at home.
The denim maker said strong interest in wide-leg and loose-fit jeans - particularly among Gen Z and younger millennial consumers - helped sustain sales. Management also emphasized a focus on selling at full price via its direct-to-consumer channel and prioritizing its best-selling items.
In preparing for tariff-related cost pressure tied to shifting U.S. administration trade policies, Levi secured the bulk of its holiday inventory earlier than usual and implemented modest price increases in October to alleviate margin pressures. The company additionally pared back lower-margin lines over the past year, exiting Denizen and Dockers in North America, and concentrated resources on the Levi's core brand while expanding the Beyond Yoga business.
For the quarter ended Nov. 30, Levi reported net revenue of $1.77 billion, a 1% increase from the prior year and above the LSEG analysts' average estimate of $1.71 billion. Regional results were uneven: revenue in Europe climbed 8%, while the Americas segment declined 4% amid constrained U.S. consumer spending and broader macroeconomic uncertainty. The Beyond Yoga brand delivered notable growth, with revenue up 37% for the quarter.
On profitability, Levi posted adjusted earnings per share of $0.41, beating the $0.39 consensus among analysts. Looking ahead to fiscal 2026, the company expects reported net revenue growth from continuing operations in a 5% to 6% range - roughly aligned with the analysts' average projection of a 5.4% rise. Its forecast for annual adjusted EPS is $1.40 to $1.46, which sits slightly below the analysts' average estimate of $1.48.
Context and strategy
Levi's results reflect a combination of product mix strength and strategic adjustments to pricing and inventory that are designed to blunt the effect of tariff-related cost headwinds. The company has narrowed its brand portfolio in North America to improve margins and concentrated investment in higher-growth businesses, including Beyond Yoga.
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