VF Corp. is progressing on its turnaround plan, besting Wall Street’s expectations in the second quarter.
For the second quarter ended Sept. 27, VF posted net income of $189.8 million, or 48 cents a diluted share, versus net income of $52.2 million, or 13 cents, in the same year-ago period. Revenues rose 1.6 percent to $2.80 billion from $2.76 billion. By channel, direct-to-consumer sales were down 1 percent to $909.9 million, while wholesale sales rose 3 percent to $1.89 billion.
Wall Street was expecting diluted earnings per share of 42 cents on revenue of $2.73 billion.
“We delivered broad-based growth for The North Face and Timberland, while continuing to moderate declines in Vans,” VF CEO Bracken Darrell, said. “We also announced the pending sale of Dickies for $600 million, enhancing our capacity to invest in the portfolio and drive shareholder returns. Looking ahead, we will continue to focus on generating value across our brands and returning the company to sustainable and profitable growth.”
Moderating declines at Vans suggest that the brand’s overhaul is taking shape. The brand made waves this fall with the Valentino Garavani x Vans collaboration, which took the latter’s Authentic silhouette and reimagined it under the direction of Valentino‘s current creative director, Alessandro Michele.
The plans to sell its Dickies brand business to Bluestar Alliance LLC was disclosed on Sept. 15. The company plans to use the proceeds to pay down debt. It also expects that transaction to be accretive to VF’s growth rate on a projected basis.
As a further indication of progress, the company said operating income was $313 million, or $330 million on an adjusted basis, both above the guidance of between $260 million to $290 million. Operating margin for the quarter was 11.2 percent, or up 130 basis points from year-ago levels. Gross margin was 52.2 percent, flat from year-ago levels. The company also said it ended the quarter with net debt down $1.5 billion.
By brand, revenue for The North Face rose 6 percent to $1.16 billion, Vans was down 9 percent to $606.9 million, Timberland was up 7 percent to $506.4 million, and for VF’s other brands, it was up 2 percent to $532.3 million. Other brands includes Altra, Icebreaker, Napapijri, Packs and Smartwool.
In a company presentation, VF said performance apparel at The North Face brand was up in every region, while transitional outerwear and footwear was up double-digits in every region.
At Vans, revenue showed sequential improvement as product newness drew in new customers, while at Timberland, which saw strong demand in the Americas driven by a strong back-to-school season. The shoe brand also saw strong demand for the 6-inch, Premium boot, led by the Americans and EMEA (Europe, Middle East and Africa), as the boat shoe also grew in all regions.
By region, sales in the Americas was down 1 percent to $1.34 billion, up 6 percent to $1.07 billion for EMEA and down 2 percent for APAC (Asia Pacific).
For the six months, net income was $73.36 million, or 19 cents a diluted share, against a net loss of $206.71 million, or 53 cents, in the same year-ago period. Revenues rose 0.8 percent to $4.56 billion from $4.53 billion.
Looking ahead, the company guided third quarter revenues to down 1 percent to down 3 percent, with adjusted operating income at between $275 million to $305 million.
For Fiscal Year 2026, it expects free cash flow to be up versus last year, including known and anticipated tariff impacts. The company is also projecting adjusted operating income to be up versus last year’s level.
Guidance for the third quarter and the full fiscal year excludes contribution from the Dickies operation in current and prior years, while free and operating cash flow guidance on a reported basis included the expected impact from the sale of the Dickie’s business in the third quarter of Fiscal Year 2026.
