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Levi Strauss beat Wall Street estimates for fourth-quarter sales and profit on Wednesday, buoyed by strong demand for its denim jeans despite pressure from higher US import tariffs and dampened consumer spending in the country.
Shares of the company, which forecast annual profit below estimates, were down about 2 percent in extended trading.
The denim maker has benefited from strong demand for baggy, loose-fit apparel — particularly among Gen Z and younger millennial shoppers — while also leaning into full-price sales through its direct-to-consumer channel and doubling down on its popular product offerings.
The company said it will fully offset the impacts of US import tariffs through the year helped by pricing strategies. Levi in October said it had secured a bulk of its holiday inventory ahead of schedule and was raising prices modestly to ease the margin pressure.
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“We’ll fully offset the tariffs through pricing actions, most of which we have implemented in the US, some overseas,” Levi Strauss CFO Harmit Singh told Reuters on Wednesday.
Higher full-price sales and lower product costs through vendor negotiations will also help in minimising the hit, Singh added.
Levi has exited lower-margin businesses such as Denizen and Dockers in North America over the past year, sharpening its focus on the core brand, and introducing the premium Blue Tab line to benefit from strong spending among higher-income shoppers.
The retailer reported a 1 percent rise in net revenue to $1.77 billion for the quarter ended Nov. 30, ahead of analysts’ average estimate of $1.71 billion, according to data compiled by LSEG.
Net revenues in Europe rose 8 percent, while those in the Americas segment fell 4 percent as consumer spending in the US remains pressured by inflation and macroeconomic uncertainty.
The company posted an adjusted profit per share of 41 cents, beating analysts’ estimates of 39 cents per share.
Levi expects fiscal year 2026 reported net revenue growth from continuing operations in the range of 5 percent to 6 percent, compared with analysts’ average estimate of a 5.4 percent rise. It expects annual adjusted earnings per share in the range of $1.40 to $1.46, below analysts’ average estimate of $1.48.
By Koyena Das and Neil J. Kanatt; Editor: Leroy Leo
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