Levi posts a stronger quarter

Levi’s just had the kind of quarter investors wait for in apparel: sales beat expectations, profit beat expectations, and management raised its outlook for the rest of 2026 after only one quarter. The company said net revenue rose 14% to about $1.5 billion in the quarter ended March 1, 2026, while adjusted diluted earnings per share came in at $0.42. (investors.levistrauss.com)(cnbc.com) The surprise inside the numbers was where the growth came from. Levi said direct-to-consumer sales, meaning shoppers buying from Levi’s own stores and website instead of a department store, made up more than half of total business for the first time. (cnbc.com)(investors.levistrauss.com) That shift matters because selling your own jeans in your own store is like a restaurant serving dinner itself instead of wholesaling ingredients to someone else. Levi keeps more of the final sale, and the company said gross margin expanded 330 basis points to 62.1% in the quarter. (investors.levistrauss.com) The growth was not coming from one lucky pocket of the world. Levi said organic net revenue rose 9%, with strength across every region and channel, including 7% growth in the Americas, 12% in Europe, and 10% in Asia on an organic basis. (investors.levistrauss.com)(finance.yahoo.com) Its website and app were a big part of that. Levi said e-commerce revenue jumped 13% on an organic basis, which fits Chief Executive Officer Michelle Gass’s plan to turn Levi from a wholesale-heavy jeans label into what she calls a direct-to-consumer-first denim lifestyle brand. (investors.levistrauss.com)(levistrauss.com) This strategy has been building for more than a year. In October 2024, Levi announced it was exploring a sale of Dockers, the khaki brand that had become a slower-growing piece of the portfolio, and in 2025 it said it would focus more tightly on the Levi’s brand, women’s apparel, and Beyond Yoga. (reuters.com)(levistrauss.com) By March 2026, that cleanup was no longer theoretical. Levi closed the Dockers sale to Authentic Brands Group and said the quarter’s reported growth included about 7 percentage points from not having Dockers in the comparison base anymore. (investors.levistrauss.com)(reuters.com) Levi also got help from product mix, not just channel mix. The company said women’s apparel, tops, and newer looser fits all contributed, which is important because a brand that only sells the same five-pocket men’s jean has a lower ceiling than one that can sell a full wardrobe. (levistrauss.com)(finance.yahoo.com) After the quarter, Levi raised its full-year 2026 outlook to net revenue growth of 5.5% to 6.5% and adjusted diluted earnings per share of $1.25 to $1.30. The company also said that guidance did not include the effect of the latest United States tariff changes announced after the quarter, which leaves one big variable hanging over the rest of the year. (investors.levistrauss.com)(cnbc.com) So the clean version is this: Levi sold more, sold more through its own channels, kept more profit on each sale, and did it across regions instead of in one hot market. For a 172-year-old denim company, that is how you stop looking like a mall brand and start looking like a stronger retail operator again. (investors.levistrauss.com)(bloomberg.com)