Levi Strauss Lowers Guidance Following Q3 Revenue Shortfall; Considers Sale of Dockers

Levi Strauss & Co. announced on Wednesday that it has lowered its annual guidance following a disappointing Q3 revenue report. The denim apparel manufacturer indicated that it is considering various options for its underperforming Dockers brand, which may include selling the brand.

In after-hours trading, Levi Strauss & Co. Class A shares experienced a decline of over 8% following this announcement.

For fiscal Q3, the company reported adjusted earnings of $0.33 per diluted share on revenue of $1.52 billion, falling short of Wall Street expectations which predicted earnings of $0.31 per share on revenue of $1.55 billion.

The revenue from Dockers saw a 15% decline compared to the same period last year, prompting the company to begin a formal review of strategic alternatives for the brand, including the possibility of a sale.

Looking ahead, Levi Strauss & Co. now expects revenue to grow by 1%, a decrease from its earlier forecast of 1% to 3%. The company anticipates an adjusted diluted earnings per share of $1.22, which is at the midpoint of the previously estimated range of $1.17 to $1.27, also missing the anticipated estimate of $1.25.