Levi Strauss & Co. shares experienced a 24-hour plunge of 6.03% in pre-market trading on Thursday, following the release of the company's second-quarter financial results.

Despite reporting adjusted earnings per share of $0.28, surpassing the analyst consensus estimate of $0.24, and revenue of $1.56 billion which also exceeded expectations, investor sentiment turned negative. The denim maker raised its full-year guidance but the midpoint of its updated adjusted earnings per share forecast of $1.46 to $1.52 came in below the $1.51 analysts were anticipating, disappointing the market.

The stock decline was further driven by significant cost pressures disclosed by the company. Levi Strauss has paid approximately $80 million under International Emergency Economic Powers Act (IEEPA) tariffs and recognized restructuring charges of $13.5 million for the quarter. These factors, combined with foreign exchange headwinds, limited gross margin expansion to just 10 basis points, overshadowing the positive earnings beat and guidance increase.