Denim maker Levi Strauss & Co. beat quarterly estimates, with consumer demand rebounding sooner than expected across various markets.
The increase in demand follows the easing of lockdown restrictions and consumers refreshing their wardrobes with street clothes and loose-fitting jeans.
“About 35 percent of consumers in the US have changed waist sizes. And some of it is up and some of it is down, but either way, it creates another reason for people to go out and update their wardrobe,” Levi CEO Charles Bergh said on an earnings call.
The company also benefitted from its collaborations with several key brands, including Valentino, as well as its push toward D2C sales, which helped boost its adjusted gross margin by 58.2 percent in the second quarter.
The improvement in the company’s margin was also supported by promotions, price increases and sourcing savings.
The company’s net revenue more than doubled to $1.28 billion in Q2, beating estimates of $1.21 billion. The revenue gains were driven by increased digital sales, which rose 75 percent as more consumers chose to have their orders delivered.
The Denizen and Dockers brands’ owner plans to further improve on its digital business by investing in distribution centers and investing in omnichannel features and such as buy online and pick up in-store.
Levi’s stock climbed 3 percent in extended trading on Thursday and the company has increased in third-quarter dividend by 33 percent.