Levi Strauss is set to release its fourth-quarter earnings after the market closes on Thursday. Here’s a breakdown of what to anticipate:
Profit
According to FactSet, Levi Strauss is projected to report a net profit of $168 million, or 42 cents per share, for the fourth quarter. This compares to a net profit of $150.6 million, or 38 cents per share, in the same period the previous year.
Adjusted Profit
When excluding one-time items, analysts expect Levi Strauss to report earnings per share of 43 cents.
Sales
FactSet forecasts that Levi’s quarterly sales will increase to $1.66 billion. In comparison, the company reported sales of $1.59 billion in the year-ago period and $1.51 billion in the third quarter.
Key Factors to Watch
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Regional Performance and Inventory Position: Investors will be closely monitoring how Levi Strauss performs in different regions and its inventory levels. The company is currently reviewing its operating model in response to lower sales in North America and Europe, while experiencing stronger sales in Asia, which grew by 12% in the previous quarter.
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Wholesale Performance: Despite the expected growth in its direct-to-consumer business, Levi’s wholesale performance is also crucial. Analysts at Citi express some concern about the possibility of the company having to reduce prices in its wholesale channel to counteract a negative sales trend.
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Strategic Direction of Beyond Yoga: Keep an eye out for any updates regarding Levi’s subsidiary, Beyond Yoga, following recent changes in leadership. Nancy Green, former CEO and president of Athleta, is taking over as CEO from co-founder Michelle Wahler, who is stepping down. Jesse Adams, Beyond Yoga’s chief operations officer and finance chief, is also leaving the company.
