Why Levi Strauss Stock Is Coming Unbuttoned After Hours

Levi Strauss & Co LEVI shares are trading lower in Thursday's after-hours session on the heels of the company's second-quarter report. Here's a rundown of the results and a look at what's driving the action.

What Happened: Levi said second-quarter revenue decreased 9% year-over-year to $1.337 billion, which narrowly missed the consensus estimate of $1.34 billion, according to Benzinga Pro. The company reported quarterly adjusted earnings of 4 cents per share, which beat analyst estimates of 3 cents per share. 

Levi said inventories increased 18% year-over-year on a dollar basis. Although gross margin ticked higher to 58.7%, operating margin fell 4.5% to 0.7% as gross margin expansion was offset by SG&A deleverage on lower net revenues and higher marketing and DTC expenses.

The company ended the quarter with $472 million in cash and equivalents, and total liquidity of $1.3 billion.

"While U.S. wholesale remains pressured, we are pursuing initiatives to stabilize this business and drive market share gains. We are confident in our ability to navigate near-term headwinds and remain as optimistic as ever about the company's future," said Chip Bergh, president and CEO of Levi.

Levi expects full-year 2023 net revenues to grow between 1.5% and 2.5% versus prior expectations of 1.5% to 3%. The company expects earnings to be between $1.10 and $1.20 per share versus estimates of $1.29 per share.

Management will hold a conference call to discuss these results at 5 p.m. ET.

See Also: Starbucks Stock Just Closed At Its Lowest Level Of 2023: What's Going On?

LEVI Price Action: Levi shares were down 7.10% after hours at $13.20 at the time of publication, according to Benzinga Pro.

Photo: Johnny_px from Pixabay.