Levi Strauss beats Q2 earnings estimates, raises full-year outlook

Evan Clark Wed, July 8, 2026 at 1:59 PM PDT | 4 min read

• LEVI

Few American brands carry a legacy to match Levi Strauss Inc., which recently celebrated the 150th anniversary of its 501 jeans — marking the birth of one of the few truly iconic styles in fashion.

The brand's power is such that even when the company was required to cover its logo at Levi's Stadium during the World Cup (as it was not an official sponsor), the secret was impossible to keep: the covered logo retained its unmistakable batwing shape.

"We had to cover it up," said Michelle Gass, president and chief executive officer, in an interview following the company's better-than-expected second-quarter results. "The team recognized that, saw the moment, was super fast and agile, leaned in, posted it on social media. The rest is history, but we're up to about a billion impressions on that."

Earning that much recognition for not being present is no small feat.

But the company has proven adept at learning new tricks as it continues its transformation from a primarily men's bottoms business into a head-to-toe fashion brand.

Q2 Financial Highlights

• Net income from continuing operations (Dockers is being held for sale) rose 18.8% to $95 million, up from $80 million a year earlier.
• Adjusted profits totaled $110 million, with earnings per share of 28 cents — 4 cents above the 24 cents analysts had forecast (per Yahoo Finance).
• Revenues for the quarter ended May 31 rose 8% to $1.6 billion.

Despite the strong results, it was a tough day on Wall Street for fashion broadly. Levi's stock fell 5.6% to $23 in after-hours trading.

Regional and Segment Performance

• Organic sales increased by 6%.
• Americas: up 7%
• Europe: down 1% (due to a distribution center change)
• Asia: up 12%
• Beyond Yoga (acquired in 2021): grew by 16%

CEO Commentary

Michelle Gass

Gass said that "momentum's building and we're continuing to deliver consistent results."

"It is about the strategies," she added. "I'd say over the last couple of years, we've spoken to you about strengthening the foundation, making strategic choices and really amplifying the power of the Levi's brand."

"We recognize that it continues to be a pretty dynamic time here in the U.S. and around the world," she said. "But the starting point for us is at times like these, consumers do turn to brands that they know and that they trust. And for millions of people around the world, that's Levi's. People are still shopping, but what they're going to gravitate towards is what's new, the innovation, etc. And that's what we're bringing. We've had a deeper pipeline than probably we've ever had."

She highlighted the summer offering, which includes lightweight fabrics, linen tops, and more.

"We are executing and the consumer is responding," Gass said.

The CEO also noted that Levi's still has significant room to grow.

"Some of these opportunities that are key to our strategy, we're still very underpenetrated," she said. "Take tops as a category. That's relatively new for us. So it's a much bigger space for us to play in. And we're seeing great growth in these new categories. We're also starting to have all of this upside for a brand that has as much history and heritage, but we're really changing the business model."

Business Model Shift

The company's increasingly retail-centric business model — 51% of sales now come from its direct-to-consumer operations — is proving to be a stronger foundation.

Harmit Singh, chief financial and growth officer, said: "We've probably generated in the first half more cash than we did all of last year. Inventory is down [7 percent on a dollar basis]. We're growing, but inventory is down because we are really managing that well."

He argued that this discipline is extending throughout the organization.

"Every quarter, we talk about our brand — this is the st"