In premarket trading on Thursday, Levi Strauss shares rose about 5%premarket after the firm boosted its annual expectations for the second time and announced a $200 million share repurchase program.
The third-quarter results were not just better than the previous year's, but also better than the year before.
As the firm attempts to leverage "global casualization trends," Levi President and Chief Executive Chip Bergh said the company's acquisition of Beyond Yoga is helping it establish itself in the fast-growing, high-margin premium sportswear industry. As people try to balance work and personal life in apparel that they believe allows them to straddle all purposes, the epidemic has fueled this shift toward casual, sports, and leisurewear.
During the quarter, approximately 10% of company-operated stores were closed globally, especially in Asia, where traffic continued at very low levels as the Delta-variant Covid-19 spread and governments put restrictions on people's mobility.
However, once businesses opened, more people logged off of their computers and went out to shop. As a result, digital sales contributed 20% of revenue in the third quarter, down from 23% in the second. Only 4% of Levi's company-operated stores throughout the world remained closed at the conclusion of the quarter.
Global wholesale revenue and digital sales both increased. The Americas, which account for more than half of the total, had a 52 % increase in revenue. Europe saw a 27 % increase in revenue, while Asia saw a 34 % increase.
The firm now expects adjusted diluted profit per share for the entire year to be $1.44 at the midpoint of the forecast range, up from $1.31 in July.
In the third quarter, net revenue increased by 41% to $1.5 billion, while profit increased by more than sevenfold to $193.3 million. Both were better than expected.