First quarter sales and operating income exceed expectations
Reaffirms full year 2025 sales guidance
REYNOLDSBURG, Ohio, June 11, 2025 (GLOBE NEWSWIRE) -- Victoria's Secret & Co. ("VS&Co" or the "Company") $(VSCO)$ today reported financial results for the first quarter ended May 3, 2025.
"I am proud of the team and their commitment to adapting and remaining flexible in this challenging and fast-changing environment. We focused on proactively managing the business ensuring we are remaining nimble and protecting investments in what matters most--the customer experience, brand health and product innovation. I am pleased with the strength the business demonstrated during the March and April timeframe, which included continued momentum in our powerhouse Beauty business, ongoing strength in PINK apparel, and newness in sport and swim as we reclaim our position as a full lifestyle brand," said VS&Co CEO Hillary Super.
VS&Co CFO Scott Sekella added, "We remained disciplined on the fundamentals and execution in the quarter driving sales and operating income results that exceeded our expectations. Though we recognize the macro environment is uncertain, we will continue to be disciplined in controlling costs and will remain agile, reading and reacting to what the customer is telling us to ensure we are building upon our solid foundation and realizing the full potential of our globally recognized brands."
Super concluded, "As we look forward, we continue to be optimistic about our future, our opportunity to further differentiate and elevate the brands with compelling storytelling and make even deeper emotional connections with our customers."
First Quarter 2025 Results
The Company reported net sales of $1.353 billion for the first quarter of 2025 which is above our previously communicated guidance range of $1.30 billion to $1.33 billion and flat compared to net sales of $1.359 billion for the first quarter of 2024. Total comparable sales for the first quarter of 2025 decreased 1%.
The Company reported operating income for the first quarter of 2025 of $20 million compared to $26 million in the first quarter of 2024. The Company reported a net loss of $2 million, or $0.02 per diluted share, for the first quarter of 2025 compared to a net loss of $4 million, or $0.05 per diluted share, for the first quarter of 2024.
Excluding the impact of the items described at the conclusion of this press release, adjusted operating income for the first quarter of 2025 was $32 million, which was above our previously communicated guidance range of adjusted operating income of $10 million to $30 million. This result compares to last year's first quarter adjusted operating income of $40 million. Adjusted net income for the first quarter of 2025 was $7 million, or $0.09 per diluted share, which was near the high-end of our previously communicated guidance range which estimated an adjusted net loss per diluted share of $0.10 to adjusted net income per diluted share of $0.10. This result compares to last year's first quarter adjusted net income of $9 million, or $0.12 per diluted share.
Second Quarter and Full Year 2025 Outlook
The Company is forecasting net sales for the second quarter of 2025 to be in the range of $1.380 billion to $1.410 billion compared to last year's second quarter net sales of $1.417 billion. At this forecasted level of net sales, adjusted operating income for the second quarter of 2025 is expected to be in the range of $15 million to $35 million. Adjusted net income per diluted share for the second quarter of 2025 is estimated to be in the range of $0.00 to $0.15.
For the full year, the Company is maintaining our forecasted net sales range of $6.2 billion to $6.3 billion. At this forecasted level of net sales, adjusted operating income for fiscal year 2025 is now expected to be in the range of $270 million to $320 million, compared to our previous guidance range of $300 million to $350 million. The revised outlook reflects an updated estimated net tariff impact of approximately $50 million for fiscal year 2025.
Forecasted adjusted operating income and adjusted net income per diluted share for the second quarter of 2025 excludes the financial impact of purchase accounting items related to the Adore Me acquisition, including expense (income) related to changes in the estimated fair value of contingent consideration and performance-based payments, as well as the amortization of intangible assets. The Company is not able to provide a reconciliation of forward-looking adjusted operating income or adjusted net income per diluted share to the most directly comparable forward-looking GAAP financial measures because the Company is unable to provide a meaningful or accurate reconciliation or estimation of certain reconciling items without unreasonable effort, due to the inherent difficulty in forecasting the timing of, and quantifying, the various purchase accounting items that are necessary for such reconciliation.
Quarterly Earnings Conference Call
Victoria's Secret & Co. will conduct its first quarter earnings call at 8:30 a.m. Eastern on Wednesday, June 11, 2025. To listen, call 1-800-619-9066 (international dial-in number: 1-212-519-0836); passcode 5358727. For an audio replay, call 1-800-839-2204 (international replay number: 1-203-369-3032); passcode 2485654 or log onto www.victoriassecretandco.com. The materials accompanying the earnings call have been posted on the Investors section of the Company's website. The audio replay will be available approximately two hours after the conclusion of the call.
About Victoria's Secret & Co.
Victoria's Secret & Co. (NYSE: VSCO) is a specialty retailer of modern, fashion-inspired collections including signature bras, panties, lingerie, apparel, casual sleepwear, swim, lounge and sport as well as award-winning prestige fragrances and body care. VS&Co is comprised of market leading brands, Victoria's Secret and PINK, that share a common purpose of supporting women in all they do, and Adore Me, a technology-led, digital first innovative intimates brand serving women of all sizes and budgets at all phases of life. We are committed to empowering our more than 30,000 associates across a global footprint of approximately 1,380 retail stores in nearly 70 countries.
Safe Harbor Statement Under the Private Securities Litigation Reform Act of 1995
We caution that any forward-looking statements (as such term is defined in the U.S. Private Securities Litigation Reform Act of 1995) contained in this press release or made by us, our management, or our spokespeople involve risks and uncertainties and are subject to change based on various factors, many of which are beyond our control. Accordingly, our future performance and financial results may differ materially from those expressed or implied in any such forward-looking statements, and any future performance or financial results expressed or implied by such forward-looking statements are not guarantees of future performance. Forward-looking statements include, without limitation, statements regarding our future operating results, the implementation and impact of our strategic plans, and our ability to meet environmental, social, and governance goals. Words such as "estimate," "commit," "will," "target," "goal," "project," "plan," "believe," "seek," "strive," "expect," "anticipate," "intend," "continue," "potential" and any similar expressions are intended to identify forward-looking statements. Risks associated with the following factors, among others, could affect our results of operations and financial performance and cause actual results to differ materially from those expressed or implied in any forward-looking statements:
-- general economic conditions, inflation, and changes in consumer
confidence and consumer spending patterns;
-- market disruptions including pandemics or significant health hazards,
severe weather conditions, natural disasters, terrorist activities,
financial crises, political crises or other major events, or the prospect
of these events;
-- uncertainty in the global trade environment, including the imposition or
threatened imposition of tariffs or other trade restrictions and any
retaliatory measures imposed by impacted exporting countries;
-- our ability to successfully implement our strategic plan;
-- difficulties arising from changes and turnover in company leadership or
other key positions;
-- our ability to attract, develop and retain qualified associates and
manage labor-related costs;
-- our dependence on traffic to our stores and the availability of suitable
store locations on satisfactory terms;
-- our ability to successfully operate and expand internationally and
related risks;
-- the operations and performance of our franchisees, licensees, wholesalers
and joint venture partners;
-- our ability to successfully operate and grow our direct channel business;
-- our ability to protect our reputation and the image and value of our
brands;
-- our ability to attract customers with marketing, advertising and
promotional programs;
-- the highly competitive nature of the retail industry and the segments in
which we operate;
-- consumer acceptance of our products and our ability to manage the life
cycle of our brands, remain current with fashion trends, and develop and
launch new merchandise, product lines and brands successfully;
-- our ability to integrate acquired businesses and realize the benefits and
synergies sought with such acquisitions;
-- our ability to incorporate artificial intelligence into our business
operations successfully and ethically while effectively managing the
associated risks;
-- our ability to source materials and produce, distribute and sell
merchandise on a global basis, including risks related to:
-- political instability and geopolitical conflicts;
-- environmental hazards, severe weather and natural disasters;
-- significant health hazards and pandemics;
-- delays or disruptions in shipping and transportation and related
pricing impacts;
-- foreign currency exchange rate fluctuations; and
-- disruption due to labor disputes;
-- our geographic concentration of production and distribution facilities in
central Ohio and Southeast Asia;
-- the ability of our vendors to manufacture and deliver products in a
timely manner, meet quality standards and comply with applicable laws and
regulations;
-- fluctuations in freight, product input and energy costs;
-- our and our third-party service providers' ability to implement and
maintain information technology systems and to protect associated data
and system availability against cybersecurity incidents and disruptions
or failures of systems;
-- our ability to maintain the security of customer, associate, third-party
and company information;
-- stock price volatility;
-- shareholder activism matters;
-- our ability to maintain our credit rating;
-- our ability to comply with regulatory requirements; and
-- legal, tax, trade and other regulatory matters.
Except as may be required by law, we assume no obligation and do not intend to make publicly available any update or other revisions to any of the forward-looking statements contained in this press release to reflect circumstances existing after the date of this press release or to reflect the occurrence of future events, even if experience or future events make it clear that any expected results expressed or implied by those forward-looking statements will not be realized. Additional information regarding these and other factors can be found in "Item 1A. Risk Factors" in our 2024 Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 21, 2025.
For further information, please contact:
Victoria's Secret & Co.: Investor Relations: Media Relations: Kevin Wynk Brooke Wilson investorrelations@victoria.com communications@victoria.com
Total Net Sales (Millions):
First First %
Quarter Quarter Inc/
2025 2024 (Dec)
-------- -------- --------
Stores -- North America $ 721.3 $ 729.1 (1.1%)
Direct 433.2 448.8 (3.5%)
International(1) 198.4 181.5 9.3%
------- ------- ----
Total $1,352.9 $1,359.4 (0.5%)
======= ======= ====
(1 -- Results include consolidated joint venture sales in China, royalties associated with franchised stores and wholesale sales.)
Comparable Sales Increase (Decrease):
First First
Quarter Quarter
2025 2024
---------- ----------
Stores and Direct(1) (1%) (5%)
Stores Only(2) (1%) (8%)
(NOTE: Please refer to our filings with the Securities and Exchange Commission for further discussion regarding our comparable sales calculation.)
(1 -- Results include company-operated stores in the U.S. and Canada, consolidated joint venture stores in China and direct sales.)
(2 -- Results include company-operated stores in the U.S. and Canada and consolidated joint venture stores in China.)
Total Stores:
Stores at 2/1/25 Opened Closed Stores at 5/3/25
Company-Operated:
--------------------
U.S. 782 1 (11) 772
Canada 24 - (1) 23
---------------- ------ ------ ----------------
Subtotal
Company-Operated 806 1 (12) 795
China Joint Venture:
--------------------
Beauty &
Accessories(1) 30 - (2) 28
Full Assortment 40 - - 40
---------------- ------ ------ ----------------
Subtotal China Joint
Venture 70 - (2) 68
Partner-Operated:
--------------------
Beauty & Accessories 324 7 (6) 325
Full Assortment 181 7 (3) 185
---------------- ------ ------ ----------------
Subtotal
Partner-Operated 505 14 (9) 510
Adore Me 6 - (1) 5
Total 1,387 15 (24) 1,378
================ ====== ====== ================
(1 -- Includes twelve partner-operated stores at 5/3/25.)
VICTORIA'S SECRET & CO.
CONSOLIDATED STATEMENTS OF LOSS
THIRTEEN WEEKS ENDED MAY 3, 2025 AND MAY 4, 2024
(Unaudited)
(In thousands except per share amounts)
2025 2024
Net Sales $1,352,949 $1,359,442
Costs of Goods Sold, Buying and
Occupancy (878,724) (858,127)
--------- ---------
Gross Profit 474,225 501,315
General, Administrative and Store
Operating Expenses (454,440) (475,046)
--------- ---------
Operating Income 19,785 26,269
Interest Expense (17,089) (21,735)
Other Income 2,957 327
--------- ---------
Income Before Income Taxes 5,653 4,861
Provision for Income Taxes 2,878 7,345
--------- ---------
Net Income (Loss) 2,775 (2,484)
Less: Net Income Attributable to
Noncontrolling Interest 4,431 1,158
--------- ---------
Net Loss Attributable to Victoria's
Secret & Co. $ (1,656) $ (3,642)
========= =========
Net Loss Per Diluted Share Attributable
to Victoria's Secret & Co. $ (0.02) $ (0.05)
========= =========
Weighted Average Shares Outstanding (1) 79,468 77,949
========= =========
(1) - Reported Weighted Average Shares Outstanding
in the first quarter of 2025 and 2024 reflect basic
shares due to the Net Loss.
VICTORIA'S SECRET & CO.
NON-GAAP FINANCIAL INFORMATION
(Unaudited)
(In thousands except per share amounts)
In addition to our results provided in accordance
with GAAP, provided below are non-GAAP financial measures
that present operating income, net income (loss) attributable
to Victoria's Secret & Co. and net income (loss) per
diluted share attributable to Victoria's Secret &
Co. on an adjusted basis, which remove certain non-recurring,
infrequent or unusual items that we believe are not
indicative of the results of our ongoing operations
due to their size and nature. The intangible asset
amortization excluded from these non-GAAP financial
measures is excluded because the amortization, unlike
the related revenue, is not affected by operations
of any particular period unless an intangible asset
becomes impaired or the estimated useful life of an
intangible asset is revised. We use adjusted financial
information as key performance measures of our results
of operations for the purpose of evaluating performance
internally. These non-GAAP measurements are not intended
to replace the presentation of our financial results
in accordance with GAAP. Instead, we believe that
the presentation of adjusted financial information
provides additional information to investors to facilitate
the comparison of past and present operations. Further,
our definition of non-GAAP financial measures may
differ from similarly titled measures used by other
companies. The table below reconciles the most directly
comparable GAAP financial measure to each non-GAAP
financial measure.
First Quarter
--------------------------------------------------
2025 2024
Reconciliation of
Reported to Adjusted
Operating Income
---------------------
Reported Operating
Income - GAAP $ 19,785 $ 26,269
Amortization of
Intangible Assets
(a) 6,284 6,284
Restructuring and
Other One-time
Charges (b) 5,597 -
Adore Me
Acquisition-related
Items (c) - 7,053
Adjusted Operating
Income $ 31,666 $ 39,606
==== ============= ==== ==== =============
Reconciliation of Reported to Adjusted Net Income
(Loss) Attributable to Victoria's Secret & Co.
-------------------------------------------------
Reported Net Loss
Attributable to
Victoria's Secret &
Co. - GAAP $ (1,656) $ (3,642)
Amortization of
Intangible Assets
(a) 6,284 6,284
Restructuring and
Other One-time
Charges (b) 5,597 -
Adore Me
Acquisition-related
Items (c) - 8,148
Tax Effect of
Adjusted Items (3,011) (1,685)
Adjusted Net Income
Attributable to
Victoria's Secret &
Co. $ 7,214 $ 9,105
==== ============= ==== ==== =============
Reconciliation of Reported to Adjusted Net Income
(Loss) Per Diluted Share Attributable to Victoria's
Secret & Co.
--------------------------------------------------------------------------
Reported Net Loss Per
Diluted Share
Attributable to
Victoria's Secret &
Co. - GAAP $ (0.02) $ (0.05)
Amortization of
Intangible Assets
(a) 0.06 0.06
Restructuring and
Other One-time
Charges (b) 0.05 -
Adore Me
Acquisition-related
Items (c) - 0.10
Adjusted Net Income
Per Diluted Share
Attributable to
Victoria's Secret &
Co. $ 0.09 $ 0.12
==== ============= ==== ==== =============
(a) In both the first quarter of 2025 and 2024, we
recognized amortization expense of $6.3 million
($4.7 million net of tax expense of $1.6
million) included in general, administrative
and store operating expense, related to our
definite-lived intangible assets.
(b) In the first quarter of 2025, we recognized
pre-tax charges of $5.6 million ($4.2 million
net of tax expense of $1.4 million), $3.8
million included in general, administrative and
store operating expense and $1.8 million
included in buying and occupancy expense,
related to activities to restructure our
executive leadership team and other one-time
expenses.
(c) In the first quarter of 2024, we recognized
pre-tax expense of $8.1 million ($8.1 million
net of tax expense of less than $0.1 million),
$7.0 million included in general,
administrative and store operating expense and
$1.1 million included in interest expense,
related to the financial impact of purchase
accounting items related to the acquisition of
Adore Me.
(END) Dow Jones Newswires
June 11, 2025 07:00 ET (11:00 GMT)