The North Face was clearly the North Star of VF Corp.’s solid fiscal fourth-quarter performance again, helping deliver the company’s first positive year of growth in three years as the brand delivered another quarter of double-digit growth in the Americas region. Still, the eyes of Wall Street remained hyper-fixated on any perceived shortcomings at the company’s Vans brand sending VFC shares down 3.2 percent for the day on Wednesday, May 20, despite the company seeing quarterly sales and earnings top guidance. Top-line growth – driven by TNF – marked the company’s strongest quarterly revenue performance in three years on a constant-currency (cc) basis, excluding the divestiture of Dickie’s.

VF Corp. also reinstated annual guidance, estimating Adjusted operating profits will expand 8 percent in the current fiscal year, with sales up 1 percent to 2 percent.

The North Face (TNF) saw sales reach $935.0 million in the fiscal fourth quarter ended March 31, up 12 percent (+7 percent cc) year-over-year. By region, the strongest performance was in the Americas, with sales up 17 percent (+16 percent cc) y/y. EMEA region sales for TNF were up 6 percent (-4 percent cc) y/y, while APAC was up 12 percent in the quarter, or up 7 percent in constant-currency terms.

VF Corp. President and CEO Bracken Darrell highlighted TNF’s growth in the Americas region, which benefited from continued investments in product elevation with the release of the Casentino Wool collection and Base Camp Leather Duffel.

“Our investments in product creation and innovation are delivering results,” said Darrell. “Softshells and fleece were key drivers in apparel. Our investment into footwear is showing strong results, or continues to, and in fact, we have now delivered five consecutive double-digit growth quarters.”

On the marketing wins, TNF athlete Alex Honnold set the record for highest urban free solo climb in history by scaling Taipei 101. Darrell also expects a big payback from North Face’s agreement announced last week to replace the Italian sportswear brand Kappa as the Official Performance Apparel Partner of U.S. Ski & Snowboard team.  Athletes will wear The North Face across all major events, including the World Cup, all World Cup events, and Winter Olympic Games and official training camps through 2034. Said Darrell, “Of course, our customers can also buy this apparel, and we’re sure they will. The brand will be front and center on the world stage, further cementing its commitment to elite mountain and adventure sport athletes.”

Darrell said The North Face is “laying a lot of groundwork” to double sales, but declined to commit to a timeframe.

“This is an exciting time for The North Face, and we’re making progress on our path to doubling this business over time,” said Darrell. “There’s so many ways we can grow this brand. Category growth, market share growth, new categories we can expand into, and finally, elevation to more premium versions of the products we already sell at higher price points. We have a lot of pent-up opportunity to drive growth at The North Face.”

Timberland’s Sales Boosted by Yellow Boot, Boat Shoes
Timberland’s sales totaled $404.8 million, up 2 percent cc (+8 percent reported). The growth marked its sixth consecutive quarter of growth and were in line with expectations.

By region, sales grew 6 percent (+4 percent cc) y/y in the Americas, increased 7 percent (+5 percent cc) y/y in APAC, and were said to have increased 10 percent in the EMEA region, which saw constant-currency sales come in flat year-over-year. Timberland’s DTC business grew 8 percent in fiscal Q4, driven in part by full-price stores. Wholesale was slightly down versus the prior-year quarter, primarily due to lower distressed sales.

“The 6-inch Premium Boot continues to be the key engine behind the brand’s momentum,” commented Darrell. “We’re also seeing good results from the boat shoe, which is growing across all regions with significant growth potential ahead. We’ll continue to both build on the strength of the iconic boot, but also introduce more innovation across the rest of our footwear assortment.”

Starting this fall, Timberland is resetting its apparel range “to create a better head-to-toe expression that matches our footwear offering,” including a focus on its women’s business. Said Darrell, “We’re driving the brand’s energy and leveraging its cultural relevancy through collaboration, seeding, and partnerships. We’re continuing to see positive brand search interest in the U.S. and the UK.”

Timberland is also prioritizing store expansion. The brand currently has 11 full-price stores in the U.S., with new stores outperforming. Said Darrell, “The outsized productivity shown by our new stores are early proof points of our new operating model working as planned. We have exciting plans for Timberland in the coming seasons as we continue to set the stage for long-term profitable growth ahead. This brand could become much larger over time, and I’m confident we’re taking the right strategic steps to ensure that happens.”

Altra’s Sales Jumps 45 Percent in Q4
Altra continued to stand out within the VF Corp. Other Brands segment, marking its fifth consecutive quarter of double-digit growth across all regions and channels. Altra’s revenue jumped 45 percent in the quarter, said to be driven by broad-based growth and new launches. Growth for the year was over 30 percent, with revenues surpassing $270 million.

“Performance was led by successful franchise launches including the original Lone Peak, now the Lone Peak 9, and the Experience, and strong execution in both DTC and wholesale,” said Darrell. “We have a really differentiated product in this space, and we’re continuing to drive awareness, which remains very low. I talked about investing in product creation and marketing, and Altra is a brand where we’ve absolutely increased the investment to drive growth. We’re excited to see outsized growth in search interest, traffic, and new consumer acquisition. This brand plays in a very large addressable market, and we believe this can be a billion-dollar-plus brand over time. There’s so much opportunity here.”

The total Other Brands segment saw sales total $339.6 million in the quarter, down 23 percent (-27 percent cc) y/y due to the divestiture of Dickie’s. Excluding Dickies, sales were up 13 percent (+7 percent cc). The Other Brands segment includes the Eastpak, Icebreaker, JanSport, Kipling, Napapijri and Smartwool brands.

VF Corp.’s Consolidated Q4 Performance
The continued concerns about Vans’ growth arrived as VF Corp. reported consolidated fourth-quarter results that came in ahead of guidance, supported by The North Face’s strong performance that drove the company’s strongest revenue performance in three years. VF Corp. President and CEO Bracken Darrell noted that 70 percent of VF’s business is now growing, up from 43 percent in 2024, when he first took over as CEO.

Fiscal Q4 Reportable Segment Information – Constant Currency Basis
(Unaudited – in thousands, except per share amounts)

Operating margins rose to 7 percent in fiscal year 2026, an expansion of 220 basis points the 4.8 percent in fiscal 2024, including the Dickies that has been sold. VF also over the last three years paid off over half of its net debt, excluding lease liabilities, with its leverage dropping from 5.1x to 2x

“A lot of strong progress on growth, on cost, and on the balance sheet,” said Darrell. “We’ve strengthened our financial position while we’ve increased our investment in brand building, product creation, and ultimately in growth, which is what it’s all about.”

In the quarter, revenues were $2.17 billion, up 3 percent on a cc basis excluding the divesture of Dickies, topping guidance calling for a flat to 2 percent growth. Analysts’ consensus target had been $2.13 billion. On a reported basis, sales excluding Dickies were up 8 percent.

On a reported basis, including Dickie’s, sales were up 1 percent to $2.17 billion while declining 4 percent on a cc basis.

The 3 percent cc growth was boosted by The North Face, which grew 7 percent y/y, led by another quarter of double-digit growth in the Americas. Timberland grew 2 percent on a constant-currency basis, its sixth consecutive quarter of growth.

By region, the Americas grew 10 percent in the quarter and was up 3 percent for the full year, reflecting the continued progress in VF’s largest region. EMEA was down 5 percent, attributed to “macro headwinds” in the region. APAC was up 1 percent, driven by demand across The North Face and Timberland. By channel, DTC delivered another quarter of growth at up 2 percent, and wholesale was up 3 percent, aided by higher-than-expected demand.

Profitability & Expenses
Gross margin for the fourth quarter was up 240 basis points versus the prior-year fourth quarter to 56.4 percent of sales, assisted by a roughly $50 million net benefit from the tariff receivable and offsetting charges. Following the Supreme Court’s tariff ruling in February related to certain tariff refunds, company CFO Paul Vogel said VF Corp. recognized a net benefit to its gross margin during Q4 and also accelerated select restructuring costs in the quarter, which drove a higher SG&A rate and partially offset the gross margin benefit. On a normalized basis, excluding these items, operating income would have come in at the midpoint of its guidance range.

Normalized gross margin was roughly flat versus last year, driven by the benefits from targeted price actions offset by mix and FX fluctuations.

SG&A as a percentage of revenue was up 70 basis points y/y, but down slightly excluding the accelerated restructuring costs. VF Corp.’s operating margin for the quarter was 2.5 percent of sales, up 170 basis points y/y.

On a reported basis, VF Corp.’s net loss totaled $119.3 million, or 30 cents a share, in the fiscal fourth quarter, against a loss of $150.8 million, or 39 cents a share, in the year-ago period. Fourth quarter Adjusted earnings per share was break even versus a loss of 14 cents per share in the year-ago fourth quarter and was just ahead of analysts’ consensus target calling for a loss of 1 cent per share for the period.

Fiscal Full Year Reportable Segment Information – Constant Currency Basis
(Unaudited – in thousands, except per share amounts)

Guidance
Revenues for the current 2027 fiscal year are expected to be up 1 percent to 2 percent in constant dollars, with slower growth in the first half. By brand, continued growth is projected at The North Face, Timberland, and Altra, driven by an ongoing focus on investing in product and marketing. Vans’ mid-single decline reflects improving trends in H2 relative to H1.

The guidance assumes the conflict in the Middle East negatively impacts revenue by about 100 basis points. Said Vogel, “To date, we’ve had some impacts to our operations in the Middle East, in particular on the wholesale side.”

VF expects slower top-line trends across the first half of the year due to the slowdown in the Middle East and Europe due to the war and company-specific trends, including wholesale timing shift.

Due to the disproportionate effect shifts can have on a smaller quarter, first quarter sales are expected to be down low single digits. VF expects an $100 million operating loss for the first quarter, about $40 million more than last year, partly driven by some investments particularly in Altra and DTC.

For the fiscal year, adjusted operating margin of approximately 8 percent, up from an operating margin of 7 percent in its just-completed year, supported by gross margin expansion at a lower SG&A rate relative to last year.

Images, data and tables courtesy The North Face and VF Corporation