Levi Cuts Revenue Outlook as Tariff Refunds Lift Profit — SkimNews
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- Levi Strauss raised full-year adjusted EPS guidance to $1.54–$1.56 (from $1.46–$1.52), boosted by tariff refunds that contributed a 16-cent per-share benefit, of which 5 cents were redeployed to holiday marketing and promotions.
- Levi lowered its full-year net revenue growth guidance to 7%, the bottom of its prior 7%–7.5% range, after Q3 revenue of $1.61B came in slightly below the $1.62B Wall Street expected.
- Levi posted Q3 operating margin of 13.8% (vs. 10.8% a year earlier), with tariff refunds adding 4.9 percentage points to operating and gross margin.
- Levi's direct-to-consumer comparable sales were roughly flat in Q3, even as wholesale revenues rose 6%; CEO Michelle Gass said DTC "fell short of our expectations" and that targeted actions were already underway.
- Levi reported U.S. revenue declined 1% in Q3 while total Americas net revenues grew 4%, and net income fell to $168.6M (43¢/share) from $218.1M (55¢/share) a year earlier.
- John Vandemore will take over as Levi's CFO effective Nov. 1, succeeding Harmit Singh, who announced his retirement in April.
Why it matters: The tariff refund is a one-time lift, not a recurring earnings driver — and Levi itself redirected 5 cents of the 16-cent per-share benefit into holiday marketing, a tell that demand needs reinforcing. Underneath the EPS beat, U.S. revenue shrank 1%, DTC comps were flat, and management acknowledged DTC "fell short," meaning the quarter's margin story is largely tariff math layered over a softening consumer backdrop at home.
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