Levi's Shares Fall Despite Strong Q3 Report, 2025 Forecast Raise

2025-10-10 12:00:43

(MENAFN- AsiaNet News)

Levi Strauss & Co. reported a strong third quarter and raised its forecast for the fiscal year on Thursday. However, shares still declined 7.7% in the after-market session.

There were no major negatives in the apparel company's earnings, but a slightly softer profit outlook for 2025 and recent stock gains over the past two months may have prompted some investors to take profits.

On Stocktwits, the retail sentiment for LEVI stock climbed multiple notches in the 'extremely bullish' zone, as of late Thursday, and 24-hour message volume rose over 1,500%. As of the last close, the stock has gained over 28% since a recent low on Aug. 1 and over 45% year-to-date.

LEVI sentiment and message volume as of October 9 | Source: Stocktwits

Levi's said its denim category demand remained strong, and that wide-leg denim bottoms were particularly popular in Europe and the Americas. Higher sales volume and steeper prices of products contributed to top and bottom line growth, it added.

For two years now, Levi's has been pursuing a strategic overhaul of the business, which includes a greater push on direct-to-consumer sales, expanding product offering beyond jeans, and branding and marketing initiatives.

Last quarter's performance "builds on the themes I've been emphasizing this year as we pivot to become a DTC-first, head-to-toe denim lifestyle retailer," CEO Michelle Gass said in the post-earnings analyst call.

She noted that Levi's repositioning as a lifestyle brand was gaining momentum. The company launched marketing campaigns featuring pop stars Beyoncé and Shaboozey during the quarter, and plans to lean into sports, with advertisements tied to the Super Bowl and FIFA World Cup matches next year.

Levi's now expects fiscal 2025 adjusted EPS in the range of $1.27 to $1.32, up from its prior forecast of between $1.25 and $1.30. The mid-point is below an estimate of $1.31, according to LSEG/Reuters. The company has assumed the impact of the U.S. tariffs in its projections.

In Q3, the company's net revenue rose 7% to $1.54 billion, beating estimates of $1.50 billion. Adjusted EPS came in at $0.34, also surpassing the $0.31 estimate.

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