Levi Strauss & Co reported better-than-expected first-quarter results and raised its full-year revenue and profit guidance. The company's shares surged more than 9% in after-hours trading following the announcement. First-quarter net revenue increased by 14% to $1.74 billion, surpassing analyst expectations of $1.65 billion. Adjusted earnings per share were 42 cents, also beating the consensus estimate of 37 cents.

The denim apparel giant has been actively mitigating the impact of U.S. tariffs through price increases, cost control measures, supplier negotiations, and diversifying its sourcing channels. The company now anticipates fiscal 2026 net revenue growth of 5.5% to 6.5%, up from its previous forecast of 5% to 6%. Analysts had projected an average growth rate of 5.7% for the fiscal year. Levi's also raised its full-year adjusted EPS guidance to $1.42-$1.48 from the prior range of $1.40-$1.46.

In January, the company projected a 150-basis-point margin decline for fiscal 2026, equivalent to approximately $100 million, but planned to fully offset this impact. Levi's Chief Financial Officer Harmit Singh noted that the company's forecasts don't yet incorporate potential benefits from tariff reductions or refunds, which could further improve margins. Singh stated, "Assuming everything goes well and the consumer remains resilient, the outlook could be even more favorable." The company announced that Singh will retire following a planned transition period and has begun searching for his successor.

The optimistic outlook underscores strong demand for core denim products despite budget pressures on middle- and low-income households. Levi's stock has gained approximately 45% over the past 12 months. Michael Gunther, an analyst at market research firm Consumer Edge, commented, "Against a backdrop of macroeconomic uncertainty and rising gasoline prices potentially impacting discretionary spending, Levi's outperformance and optimistic commentary stand out, particularly considering the customer base the company relies on."

The company demonstrated strength across consumer segments. Singh reported that sales of its premium Blue Tab denim line increased 40% in the first quarter, while the Signature line—targeting budget-conscious shoppers through retailers like Walmart and Amazon with prices around $20—grew 16%. Sales in the Americas, Levi's largest market, increased 9%. European sales rose 24%, while Asian sales grew 13%. Comparable sales through direct-to-consumer channels, including websites and stores, increased 7% for the quarter ended March 1.