Levi’s Wholesale Business Suffers, Company Lowers Outlook — Retail Bum

Denim marker Levi Strauss & Co. saw its revenue decline in the high single digits as its business suffered from a decline in wholesale demand in the United States.

The company said its quarterly revenue was down 9% to $1.3 billion, lower than analysts’ estimate of $1.34 billion, with a 22% decline in wholesale net revenue resulting in a $100 million hit to net revenue.

While Levi’s wholesale business suffered, it benefitted from growth in its DTC (direct-to-consumer) business, which increased by 13% on a reported basis and 14% on a constant currency basis. The growth in DTC business was supported by both eCommerce, mainline, and outlet stores.

E-commerce revenue, specifically, saw a 20% increase on a reported basis and 21% on a constant-currency basis.

“Our strong Q2 DTC and international results in a challenging environment demonstrate the resilience of our business model and the health of Levi’s brand globally,” said Chip Bergh, president, and chief executive officer of Levi Strauss & Co. “While U.S. wholesale remains pressured, we are pursuing initiatives to stabilize this business and drive market share gains. We are confident in our ability to navigate near-term headwinds and remain as optimistic as ever about the company’s future.”