An employee holds a shopping bag while ringing up a customer at the Levi Strauss & Co. flagship store in San Francisco, March 18, 2019.
David Paul Morris | Bloomberg | Getty Images
Denim retailer Levi Strauss & Co. on Tuesday reported fiscal first-quarter earnings and revenue that topped analysts’ estimates as it sold more of its jeans and T-shirts at higher price points, often directly to customers.
Levi also reaffirmed its forecast for fiscal 2022, assuming no significant worsening of inflationary pressures or closures of global economies. It took into account any hit from its recent decision to temporarily suspend business in Russia, which represents roughly 2% of its total sales.
The retailer has yet to see consumers trade down for less expensive apparel, even as everything from gasoline prices to grocery bills surge, Levi CEO Chip Bergh told CNBC in a phone interview. And still, as the company has raised prices on some items to offset other expenses within the business, consumer demand has remained strong, he added.
To be sure, Bergh said Levi is keeping a close eye on consumer demand, knowing that projections of a looming recession have been growing among economists. “We don’t have our head in the sand,” the CEO said. “If we see [demand] starting to get wobbly, we will take the appropriate action.”
Levi shares rose around 1.5% in extended trading, after closing the day down 1.5%.
Here’s how Levi did for the three-month period ended Feb. 27 compared with what Wall Street was anticipating, based on a survey of analysts by Refinitiv:
- Earnings per share: 46 cents adjusted vs. 42 cents expected
- Revenue: $1.59 billion vs. $1.55 billion expected
Levi reported net income of $196 million, or 48 cents per share, compared with net income of $143 million, or 35 cents a share, a year earlier. Excluding one-time items, it earned 46 cents a share, better than the 42 cents that analysts had been looking for.
Revenue rose 22% to $1.59 billion from $1.31 billion a year earlier….
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