Levi Strauss & Co. reported sales at Beyond Yoga grew 16 percent in its fiscal second quarter ended May 31, to $43 million. Operating losses at Beyond Yoga were trimmed to $2 million from $4 million a year ago. Levi’s lifted its outlook for the year on a better-than-expected quarterly performance.

“The Levi’s brand is connecting with consumers around the world in more powerful ways than ever before, and our Q2 results are another proof point that our strategies are working and our team is executing,” said Michelle Gass, president and CEO of Levi Strauss & Co. “Our evolution into a DTC-first, denim lifestyle company—with a much larger addressable market—is translating to faster growth and higher profitability. While we are pleased with the progress, we are still in the early stages of our long-term growth journey, with more ways to win than ever before.”

“We delivered another strong quarter driven by broad-based growth across markets, channels and categories,” said Harmit Singh, chief financial and growth officer of Levi Strauss & Co. “That growth translated into higher profitability through gross margin expansion and disciplined SG&A leverage, demonstrating the strength and scalability of our operating model. Given our strong first-half results, we are passing through our full Q2 beat and raising our full-year guidance. We are also increasing our dividend, reflecting confidence in the strength of our business, our cash flow generation and our ability to create long-term shareholder value.”

Financial Highlights for the Second Quarter

  • Net Revenues of $1.6 billion increased 8 percent on a reported basis and 6 percent on an organic basis versus Q2 2025.
  • In the Americas, net revenues increased 9 percent on a reported basis and increased 7 percent on an organic basis. Within the Americas, the U.S. increased 5 percent on a reported basis.
  • In Europe, net revenues increased 4 percent on a reported basis and decreased 1 percent on an organic basis entirely due to the impact of the company’s distribution center transition last year, which resulted in a shift of shipments from Q1 2025 into Q2 2025. H1 2026 net revenues increased 14 percent on a reported basis and 5 percent on an organic basis.
  • In Asia, net revenues increased 10 percent on a reported basis and 12 percent on an organic basis.
  • DTC (Direct-to-Consumer) net revenues increased 11 percent on a reported basis and 8 percent on an organic basis. DTC growth on a reported basis reflected a 5 percent increase in the U.S., a 12 percent increase in Europe and a 12 percent increase in Asia. DTC growth on an organic basis reflected a 7 percent increase in Europe and a 12 percent increase in Asia. Net revenues from e-commerce grew 19 percent on a reported basis and 17 percent on an organic basis. DTC comparable sales growth was 6 percent. DTC comprised 51 percent of total net revenues in the second quarter.
  • Wholesale net revenues increased 5 percent on a reported basis and 3 percent on an organic basis.

  • Operating margin was 7.8 percent in Q2 2026 compared to 7.5 percent in Q2 2025. Adjusted EBIT margin was 9.0 percent in Q2 2026 compared to 8.3 percent in Q2 2025.
  • Gross margin expanded 10 basis points to 62.7 percent, driven by lower product costs and pricing actions. Tariffs and foreign exchange were a headwind in the quarter.
  • Selling, general and administrative expenses (SG&A) were $843 million compared to $791 million in Q2 2025. Adjusted SG&A was up 6.5 percent to $838 million compared to $787 million last year, primarily due to higher selling expenses and foreign exchange.
  • Interest and other income (expense), net, which includes foreign exchange gains and losses, were zero in the aggregate in Q2 2026 and expenses of $6 million in the aggregate in Q2 2025.
  • The effective income tax rate was 22.4 percent, compared to 22.3 percent in Q2 2025.
  • Net income from continuing operations was $95 million compared to $80 million in Q2 2025. Adjusted net income was $110 million compared to $89 million in Q2 2025.
  • Diluted earnings per share from continuing operations was 24 cents compared to 20 cents in Q2 2025. Adjusted diluted earnings per share was 28 cents compared to 22 cents in Q2 2025.

Balance Sheet Review as of May 31, 2026

  • Cash and cash equivalents were $849 million, while total liquidity was approximately $1.8 billion.
  • Total inventories decreased 7 percent on a dollar basis compared to Q2 2025.

Shareholder Returns

  • In the second quarter, the company returned $53.9 million in the form of dividends to shareholders, a 5 percent increase over prior year, representing a dividend of 14 cents per share. The $200 million accelerated share repurchase program launched in the first quarter of 2026 is expected to be settled in the third quarter.
  • As of May 31, 2026, the company had $240 million remaining under its current share repurchase authorization, which has no expiration date.
  • The company declared a dividend of $0.16 per share, a 14 percent increase over prior year, totaling approximately $62 million, payable in cash on August 5, 2026 to the holders of record of Class A common stock and Class B common stock at the close of business on July 22, 2026.

Fiscal 2026 Guidance
Guidance for 2026 is based on continuing operations, reflecting the Dockers business being reported in discontinued operations. Guidance assumes U.S. tariffs on imports from China remain at 30 percent and Rest-of-World at 20 percent.

The following guidance is provided for the year ending November 29, 2026:

Image courtesy Beyond Yoga/Charts courtesy Levi Strauss & Co.