Levi Strauss & Co (LEVI) Q2 2026 earnings summary

Executive summary

• Net revenues for Q2 2026 rose 8% year-over-year to $1.56 billion, with organic net revenues up 6% and strong growth in both Americas and Asia, led by DTC and wholesale channels.

• Adjusted EBIT grew 18% to $141 million, and adjusted diluted EPS increased 27% to $0.28, both ahead of guidance.

• DTC net revenues grew 11% (reported) and 8% (organic), now comprising 51% of total net revenues.

• Women's business outperformed, up 11%, and the company extended market share in both men's and women's categories.

• Full-year 2026 net revenue and EPS guidance raised; quarterly dividend increased.

Financial highlights

• Gross margin expanded 10 basis points to 62.7%, driven by lower product costs and pricing actions, despite tariffs and FX headwinds.

• Net income from continuing operations was $95 million, up from $80 million in Q2 2025; adjusted net income was $110 million, up from $89 million.

• Adjusted EBIT margin reached 9.0% in Q2 2026, up 70 basis points year-over-year.

• Adjusted free cash flow for Q2 2026 was $231 million, up nearly 60% year-over-year.

• Inventory levels decreased 7% year-over-year, reflecting improved management.

Outlook and guidance

• Full-year 2026 reported net revenue growth guidance raised to 7.0–7.5%; organic net revenue growth to 5.5–6.0%.

• Gross margin expected to expand ~10 basis points for the year; adjusted EBIT margin forecasted at 12%.

• Adjusted diluted EPS guidance raised to $1.46–$1.52, including a $0.04 headwind from a higher tax rate.

• Q3 net revenues expected to grow 4–5%, with gross margin at 61.8% and adjusted diluted EPS of $0.34–$0.36.

• Plan to open 50–60 net new stores in 2026, weighted to the second half.