Levi Strauss & Co. (LEVI) Second Quarter 2025 Financial Results

# Levi Strauss & Co. (NYSE: LEVI) Second Quarter 2025 Financial Results

On July 10, 2025, Levi Strauss & Co. (NYSE: LEVI) announced its financial results for the second quarter ended June 1, 2025.

## Financial Highlights

– **Net Revenues**:
– **Total**: $1.4 billion, up **6%** reported and **9%** organically from Q2 2024.
– **Americas**: Increased **5%** reported and **9%** organically.
– **U.S.** specifically grew **7%** organically.
– **Europe**: Net revenues increased **14%** reported and **15%** organically.
– **Asia**: Net revenues were flat, both reported and organically.

– **DTC (Direct-to-Consumer)**:
– Net revenues increased **11%** reported and **10%** organically.
– E-commerce growth: **13%** reported and **13%** organically.
– DTC sales represented **50%** of total net revenues for the quarter.

– **Wholesale Revenue**:
– Increased **3%** reported and **7%** organically.

– **Gross Margin**: Expanded **140 basis points** to **62.6%** from **61.3%** in Q2 2024.

– **Operating Income**:
– **Operating Margin**: **7.5%**, up from **1.5%** in Q2 2024.
– **Adjusted EBIT Margin**: **8.3%**, up **190 basis points** from **6.3%** in the previous year.

– **Profitability**:
– **Diluted EPS from Continuing Operations**: $0.20, an increase from $0.04 in Q2 2024.
– **Adjusted Diluted EPS**: $0.22, which is **up 37%** year-over-year.

– **Net Income**:
– From continuing operations: $80 million, compared to $17 million in Q2 2024.
– Adjusted net income: $89 million, up **35%** from $65 million in Q2 2024.

– **Balance Sheet**:
– Cash and cash equivalents: $654 million.
– Total inventories: increased **15%** on a dollar basis.

## Shareholder Returns

– Levi Strauss declared a quarterly dividend of **$0.14 per share** for Q3, totaling approximately **$55 million**. This is an increase from the previous dividend of **$0.13 per share**.
– The dividend is payable on August 8, 2025, to shareholders of Class A and Class B common stock as of July 24, 2025.
– Approximately **$51 million** was returned to shareholders in the second quarter, an **8% increase** over the prior year.

## Revised Fiscal 2025 Guidance

– **Reported Net Revenue Growth** raised from **(1% to 2%)** to **1% to 2%**.
– **Organic Net Revenue Growth** increased from **3.5% to 4.5%** to **4.5% to 5.5%**.
– Gross margin expectations adjusted to an expansion of **80 basis points**, down from a previous projection of **100 basis points**.
– **Adjusted EBIT Margin** guidance maintained at **11.4% to 11.6%**.
– Adjusted diluted EPS raised to **$1.25 to $1.30**, up from **$1.20 to $1.25**.

## Additional Notes

– The company is focused on its **DTC-first strategy**, anticipating it will lead to higher growth rates and margins moving forward.
– Management expressed optimism about the company’s trajectory despite ongoing challenges with higher tariffs, emphasizing a commitment to transforming Levi’s into a leading denim lifestyle brand.

## Summary

Levi Strauss & Co. demonstrated solid performance in Q2 2025, marked by significant growth in net revenues and profitability metrics, coupled with positive outlook revisions for the remainder of the year. The strategic shift towards a DTC-first business model, alongside geographic and segment-specific revenue increases, positions the company well despite external economic pressures. The increase in shareholder returns further reflects management’s confidence in the business’s direction and financial health.

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