Levi Strauss Earnings Beat, Guidance Raised

Levi Strauss & Co. (LEVI) reported fiscal first-quarter 2026 results on April 7, 2026, surpassing analyst expectations and raising full-year guidance after stronger-than-expected demand. The company expanded its outlook and strategy based on this momentum.

Quarter Results and Guidance

Levi Strauss posted net revenues of $1.7 billion for the quarter ended March 1, 2026, up 14% reported and about 9% organically from a year earlier, exceeding the $1.65 billion consensus, according to the company’s 8-K and 10-Q summaries. The revenue growth reflected broad regional strength and higher selling prices.

Adjusted diluted earnings per share reached $0.42, above the $0.37 consensus and up from $0.38 in the prior year. Adjusted EBITDA totaled $273.1 million, also beating expectations. Diluted earnings from continuing operations were $0.45, while net income from continuing operations rose 26% to $177.1 million.

The company raised its full-year 2026 guidance, projecting reported net-revenue growth of 5.5%–6.5% and organic growth of 4.5%–5.5%. Adjusted diluted EPS guidance was set at $1.42–$1.48. Levi Strauss expects gross margin to be flat to slightly up and adjusted EBIT margin to expand toward roughly 12%, assuming stable macroeconomic conditions and current tariff levels. This outlook reflects management’s confidence that recent momentum will continue.

Quarterly margins narrowed year over year. Adjusted EBIT margin declined to 12.5% from 13.4% in the prior year, and operating margin fell to 11.4% from 12.5%, reflecting ongoing cost and product-mix pressures.

Direct-to-Consumer Growth and Capital Returns

Direct-to-consumer (DTC) net revenues rose about 15.7%–16% reported and 10% organically, accounting for 52% of total net revenues. DTC comparable-store sales increased 7%, while e-commerce sales jumped 21%, driven by resilient demand for premium denim, the filings showed. Management described this as evidence that the DTC strategy is expanding the addressable market and improving sales consistency.

Wholesale net revenues also contributed, rising roughly 12% reported and about 8% organically for the quarter.

Improved cash flow supported increased shareholder returns. Free cash flow turned positive at $152.1 million, compared with negative $14.1 million in the year-earlier quarter. The company returned $214 million to shareholders through dividends and launched a $200 million accelerated share-repurchase program expected to retire about 8 million shares. Management linked these capital returns to stronger operating cash flow.

Levi Strauss’s raised full-year targets provide a clearer benchmark for upcoming quarters. Investors will closely watch the company’s DTC growth and margin execution as the year progresses.