US apparel and footwear giant VF has swung to a profit and reported better-than-anticipated revenues for its second quarter ended 28 September 2024 (Q2 FY25).
VF, the parent company to brands such as The North Face, Vans, Timberland, and Dickies, witnessed a 6% decline in revenue during the quarter, amounting to $2.75bn compared to $2.92bn reported in the corresponding quarter of FY24.
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However, revenue in the second quarter improved by 10% from the first quarter of the current fiscal year.
During the period ending 28 September 2024, revenue of The North Face brand decreased by 3% from the prior year quarter while Vans experienced an 11% drop from Q2 FY24.
Despite the revenue slump, VF posted a net income of $52.17m in Q2 FY25, a significant recovery from the net loss of $450.69m in the same quarter of the previous financial year.
The company’s earnings per share from continuing operations stood at $0.52 in Q2 FY25, in contrast to a loss per share of $1.16 in Q2 FY24.
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By GlobalDataVF also reported a gross margin of 52.2%, which is an increase of 120 basis points compared to last year’s figures.
As of the end of Q2 FY25, the company’s net debt was $5.7bn, which is approximately $446m lower than the previous year.
VF president and CEO Bracken Darrell said: “Our results in the quarter met our expectations and reflect a sequential and broad-based improvement in year-on-year trends.
“At the same time, we made further progress on our four Reinvent priorities and we are on track to reach our previously announced $300m savings target by the end of FY25. Following the completion of the Supreme divestiture on October 1, 2024, we delivered on our commitment to pay down VF’s $1bn term loan due December 2024.”
Looking ahead to Q3 FY25, VF anticipates revenue to be in the range of $2.7bn to $2.75bn.
The company also forecasts adjusted operating income to be between $170m and $200m, compared to $218m in Q3 FY24.
VF is the parent of several outdoor, active, and workwear brands.
