Strong demand for Levi Strauss & Co (NYSE:LEVI)'s iconic jeans in its fiscal first quarter wasn’t enough to impress investors after its earnings release Thursday morning.
The denim company topped quarterly revenue estimates with $1.7 billion in sales for the quarter ended February 26, 2023, an increase of 6% year-over-year and ahead of analyst estimates of around $1.62 billion.
Levi’s also beat profit estimates on an adjusted basis, earning $0.34 per share, ahead of Street estimates of $0.32 per share.
However, attributable net income fell to $114.7 million in the first quarter from $195.8 million a year earlier.
The firm maintained its annual forecast due to macroeconomic uncertainties, a sign of cautiousness surrounding its demand outlook and higher expenses going forward.
Its operating margin was 9.3% and the adjusted EBITDA (earnings before interest, taxes, depreciation, and amortization) margin was 11%, down from 14.9% in 1Q 2022, owing to persistent cost pressures.
Shares of the San Francisco-based company fell more than 4.7% in premarket trade.
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