Key Takeaways
- Shares of Victoria’s Secret climbed approximately 40% following first-quarter adjusted earnings of $0.60 per share, exceeding analyst projections of $0.30 by 100%.
- Quarterly revenue reached $1.56 billion, representing a 15% year-over-year increase and surpassing the consensus forecast of $1.52 billion.
- Annual sales projections were upgraded to a range of $7.03–$7.13 billion, above the previous forecast of $6.85–$6.95 billion.
- The retailer increased its full-year adjusted operating income outlook by over $100 million to $550–$580 million from $430–$460 million.
- Chief Executive Hillary Super highlighted broad-based momentum across all product lines, distribution channels, and consumer demographics, achieved with reduced promotional activity compared to last year.
Shares of Victoria’s Secret launched Tuesday’s trading session around the $77 mark, climbing roughly 40–48% in early action, following the intimate apparel company’s impressive first-quarter performance and enhanced full-year projections.
The retailer posted adjusted earnings of $0.60 per share for the period, handily beating the Street’s expectation of $0.30 by a factor of two. Quarterly revenue climbed 15% from the prior-year period to $1.56 billion, topping analyst estimates calling for $1.52 billion. The company swung to a net profit of $47.7 million, a stark contrast to the $1.66 million loss recorded in the same quarter last year.
Comparable store sales advanced 13% during the three-month period, exceeding StreetAccount’s projection of 11.4% growth. Chief Executive Hillary Super emphasized that the positive momentum was widespread throughout the organization.
“We’re seeing very consistent, double-digit increases across Victoria’s Secret, Pink, beauty channels, digital, stores and international,” Super explained in an interview with CNBC. The executive noted that the company achieved this expansion while reducing promotional intensity and captured additional market share, especially among younger consumers in the 18 to 24 age bracket.
Company Boosts Annual Projections
The lingerie retailer elevated its full-year revenue expectations to $7.03–$7.13 billion from its prior guidance of $6.85–$6.95 billion, which also surpasses the analyst consensus of $6.99 billion. The company’s adjusted operating income forecast for the year was revised upward to $550–$580 million from $430–$460 million — representing a midpoint increase exceeding $100 million.
For the second quarter, management projected sales in the $1.59 billion to $1.62 billion range, above Wall Street’s $1.56 billion estimate. Chief Financial Officer Scott Sekella attributed the enhanced outlook to robust first-quarter performance, improved fixed-cost leverage, and reduced tariff expenses resulting from legal challenges to certain President Trump’s trade policies. However, the company anticipates approximately $15 million in tariff-related costs during the current quarter.
The stock has experienced remarkable appreciation, nearly tripling in value over the preceding 12 months before this earnings announcement. Ortex data indicates that roughly 19% of the available float is currently held in short positions — a concentration that market observers suggest could potentially trigger a short squeeze.
Strategic Transformation Shows Results
Super, who assumed leadership in 2024, has prioritized realigning the brand with its heritage identity, reducing reliance on discounting, and reinvigorating the bra segment as a foundational pillar of the business. Her initiatives included bringing back the iconic annual runway presentation after a six-year hiatus, and in May, the company transitioned its NYSE ticker symbol from VSCO to VSXY — symbolizing the brand’s repositioning efforts.
This quarter represents the fourth consecutive period of top-line expansion for the company. Super observed that her executive leadership team is nearing its first anniversary, and the financial outcomes validate their strategic direction. Sales growth was evident across all consumer income segments, with particularly strong performance among households earning below $50,000 and those exceeding $200,000 in annual income.
Sekella clarified that tax refund activity throughout the quarter remained at typical levels and that business trends have maintained their trajectory into the current quarter, despite the conclusion of that seasonal benefit.
Dana Telsey of Telsey Advisory highlighted the validation of management’s approach: “The leadership team and strategies are beginning to bear fruit through an evolving assortment across brands, supported by improved messaging and brand storytelling.”
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