The Denim Company Saw DTC Growth, While Partnering with Beyoncé and Looking to Sell Dockers
Levi Strauss & Co. has adjusted its full-year revenue outlook, now expecting net revenue to grow by about 1 percent, down from an earlier projection of 1 to 3 percent. In the fiscal third quarter, which ended on Aug. 25, sales fell slightly short of expectations, with the Americas division experiencing a revenue decline. Despite these challenges, the company saw a 10 percent growth in its direct-to-consumer business, including its own stores and e-commerce platforms.
Levi’s is focusing on cultural relevance to strengthen its brand, recently partnering with Beyoncé to modernize classic ads and expand its women’s business. The company aims to double its women’s division, which grew by 11 percent in the third quarter, and expects it to reach $2 billion by the end of the year.
Meanwhile, the company is reviewing options for its Dockers brand, including a potential sale, after Dockers saw a 15 percent decline in sales during the quarter. This is part of Levi’s strategy to improve margins by focusing on its core businesses. Dockers, launched in 1986 as a casual khaki brand, has struggled in recent years to maintain relevance.
Levi’s Beyond Yoga division, launched more recently, saw a 19 percent increase in sales, contributing to the company’s overall growth. However, the wholesale business continues to decline, with a 6 percent drop in the latest quarter.
Levi’s fiscal third-quarter net income increased by 116 percent to $20.7 million, and adjusted earnings per share rose by 18 percent. Revenue for the quarter edged up 0.4 percent to $1.52 billion, slightly below expectations. The company expects adjusted earnings for the full year to come in within its previously forecast range.