Levi Strauss Reports Higher Third-Quarter Revenue But Profits Decline as Expenses Rise

Levi Strauss & Co. (LEVI) experienced a rise in third-quarter revenue to $1.61 billion, up from $1.54 billion in the same period last year. However, the apparel maker's net income dropped to $168.6 million, down from $218.1 million a year earlier. This resulted in diluted earnings per share falling to $0.43 from $0.55. On the stock market, shares of the company fell nearly 5% following the announcement.

The drop in profitability came despite a 4.3% increase in quarterly revenue, which was driven by stronger wholesale and direct-to-consumer sales across all geographic regions. Direct-to-consumer sales made up 49% of year-to-date revenues, bolstered by a 17% jump in online sales. The core Levi's brand remained the dominant driver, representing roughly 94% of total net revenues.

Investors will likely monitor the company's ongoing corporate changes and productivity efforts. Levi Strauss has recently transitioned to third-party logistics, finished selling off its Dockers brand, and incurred restructuring charges alongside higher selling, general, and administrative expenses. Additionally, tariff refunds under the International Emergency Economic Powers Act helped support the company's gross margins during the quarter.