PVH Corp., the parent of Calvin Klein and Tommy Hilfiger, reported a low-single-digit revenue gain in the first quarter and saw adjusted earnings exceed plan; however, it reduced its earnings guidance for the year due to broader weakening sales trends.

Stefan Larsson, chief executive officer, commented, “In Q1, we continued to tap into the global consumer love for Calvin Klein and Tommy Hilfiger, delivering revenue growth versus last year and ahead of guidance. Calvin Klein saw one of its most impactful product launches in years with the Icon Cotton Stretch franchise, amplified by the viral Bad Bunny campaign. Tommy Hilfiger tapped into its lifestyle DNA with rich product storytelling around seasonal newness of Tommy classics to drive growth and built momentum for the brand’s collaboration with the biggest movie launch of the summer: F1 The Movie.”

Larsson continued, “While we are making important progress in our PVH+ Plan execution, we are navigating an increasingly uncertain consumer and macroeconomic backdrop—and given where we are on our brand-building journey, we’re not yet fully able to offset that impact. Looking ahead, we’re focused on what we can control, stepping up our actions to scale the impact of our stronger product, next-level cut-through campaigns, and sharper marketplace execution across both brands. This will both strengthen the back half of this year and continue to move us toward our long-term goal of building Calvin Klein and Tommy Hilfiger into the most desirable lifestyle brands in the world.”

Zac Coughlin, chief financial officer, said, “We drove solid first quarter results, which included low-single-digit revenue growth and non-GAAP earnings per share above our guidance. We are navigating a highly dynamic and uncertain macroeconomic environment that is impacting our industry, our consumers, and our business results. We are reaffirming our revenue guidance for the year but are decreasing our outlook for profitability and earnings per share to reflect that backdrop and the current performance of our business. Our focus remains on taking proactive measures, including investing in cut-through marketing campaigns and delivering increasing cost efficiencies through execution of our Growth Driver 5 multi-year cost savings initiative that will improve our trajectory in the second half.”

First Quarter Review

Revenue of $1.984 billion increased 2 percent compared to $1.952 billion in the prior year period (increased 2 percent on a constant currency basis). Revenue performance for the company’s reportable segments in the first quarter compared to the prior year period was as follows:

  • EMEA revenue increased 5 percent compared to the prior year period, increased 4 percent on a constant-currency basis, driven by growth in both the wholesale and direct-to-consumer businesses.
  • Americas revenue increased 7 percent compared to the prior year period, increased 8 percent on a constant-currency basis, driven by growth in the wholesale business, partially offset by a mid-single-digit decline in the direct-to-consumer business. The increase in wholesale revenue included the transition of previously licensed women’s product categories in house and the impact of a shift in the timing of wholesale shipments from the second half into the first half of this year.
  • APAC revenue decreased 13 percent compared to the prior year period, decreased 11 percent on a constant-currency basis, primarily due to an approximately 3 percent decline resulting from the timing of the Lunar New Year shopping period, which was primarily in the fourth quarter of 2024, and a challenging consumer environment in the region, particularly in China.
  • Licensing revenue decreased 2 percent compared to the prior year period due to the transition of certain previously licensed women’s product categories in house.

Revenue performance for the company’s global brand businesses in the first quarter compared to the prior year period was as follows:

  • Tommy Hilfiger revenue increased 3 percent compared to the prior year period, increased 3 percent on a constant-currency basis, driven by growth in EMEA and Americas.
  • Calvin Klein revenue was flat compared to the prior year period, flat on a constant-currency basis.

Revenue performance for the company’s channels in the first quarter compared to the prior year period was as follows:

  • Direct-to-consumer revenue decreased 3 percent compared to the prior year period, decreased 3 percent on a constant-currency basis.
  • Owned and operated store revenue decreased 5 percent compared to the prior year period, decreased 5 percent on a constant-currency basis, as growth in EMEA was more than offset by declines in Americas and APAC primarily due to the challenging consumer environment in those regions.
  • Owned and operated digital commerce revenue increased 3 percent compared to the prior year period, increased 4 percent on a constant-currency basism driven by growth in Americas.
  • Wholesale revenue increased 6 percent compared to the prior year period, increased 7 percent on a constant-currency basis, driven by the increases in Americas and EMEA as discussed above.

Gross margin was 58.6 percent compared to 61.4 percent in the prior year period. The decrease reflects the impacts of an unfavorable shift in channel mix, an increased promotional environment, the gross margin differential due to the transition of previously licensed women’s product categories to an in-house wholesale business, and  higher freight costs and incremental discounts provided to customers to address the impact of Calvin Klein product delivery delays.

Inventory increased 19 percent compared to the prior year period primarily due to a purposeful investment in core product inventory to improve overall availability, an increase in inventory to support the projected sales growth in the second quarter, and earlier receipts of summer season product to improve in-season stock availability.

Earnings (loss) before interest and taxes (EBIT) on a GAAP basis was $(332) million, inclusive of a $4 million negative impact attributable to foreign currency translation, compared to $205 million in the prior year period. Included in the first quarter of 2025 were non-cash goodwill and other intangible asset impairment charges of $480 million, which were primarily due to a significant increase in discount rates.

EBIT on a non-GAAP basis was $160 million, inclusive of the $4 million negative impact attributable to foreign currency translation, compared to $195 million in the prior year period. The decrease was driven by the gross margin decline discussed above. The company continues to take a disciplined approach to managing expenses, driving cost efficiencies while making targeted investments to drive its strategic initiatives.

Earnings (loss) per share (EPS)

  • GAAP basis: $(0.88) compared to $2.59 in the prior year period.
  • Non-GAAP basis: $2.30 compared to $2.45 in the prior year period. Previous guidance was $2.10 to $2.25.

EPS on both a GAAP and a non-GAAP basis for the first quarter of 2025 includes the negative impact of $0.06 per share related to foreign currency translation. EPS on a GAAP basis for these periods includes $480 million pre-tax noncash goodwill and other intangible asset impairment charges in the first quarter of 2025.

Interest expense decreased to $17 million from $18 million in the prior year period.

Effective tax rate was 87.2 percent on a GAAP basis compared to 19.2 percent in the prior year period. The effective tax rate for the first quarter of 2025 included the impact of the $480 million pre-tax noncash goodwill and other intangible asset impairment charges, which are non-deductible for tax purposes and factored into the company’s annualized effective tax rate. The effective tax rate on a non-GAAP basis for the first quarter of 2025 excludes this impact. The effective tax rate on a non-GAAP basis was 17.1 percent compared to 19.4 percent in the prior year period.

Stock Repurchase Program
Delivering on its commitment under the PVH+ Plan to return excess cash to stockholders, the company entered into ASR agreements in April 2025 to repurchase an aggregate of $500 million of its common stock under the company’s existing $5 billion stock repurchase authorization.

In total during the first quarter of 2025, the company repurchased 5.4 million shares of its common stock and paid $561 million in connection with the ASR agreements and open market purchases. The company currently does not expect to make any additional payments to repurchase its common stock in 2025. The number of shares of common stock repurchased for the full year 2025 is subject to the final settlement under the ASR agreements.

2025 Outlook
The company’s 2025 outlook reflects an estimated net negative impact related to the tariffs currently in place for goods coming into the U.S., including an approximately $65 million unmitigated impact to full year 2025 EBIT, or approximately $1.05 per share, and a partially offsetting impact of planned mitigation actions which will primarily take effect in the second half of 2025.

There is significant uncertainty with respect to global trade policies and the related impact on the broader macroeconomic environment and, as such, the company’s 2025 outlook could be subject to significant material change.

Full Year 2025 Guidance

  • Revenue: Reaffirming outlook of flat to increase slightly (flat to increase slightly on a constant currency basis).
  • Operating margin: Projected to be approximately 8.5 percent on a non-GAAP basis. Previous guidance was flat to increase slightly on a non-GAAP basis compared to 10.0 percent on a non-GAAP basis in 2024. Operating margin on a GAAP basis was 8.9 percent in 2024.
  • EPS: Projected to be in a range of $10.75 to $11.00 on a non-GAAP basis compared to $10.56 on a GAAP basis and $11.74 on a non-GAAP basis in 2024. Previous guidance was range of $12.40 to $12.75.

The 2025 EPS projection includes an estimated net negative impact related to the tariffs currently in place for goods coming into the U.S., including an unmitigated impact of approximately $1.05 per share and a partially offsetting impact of planned mitigation actions and the estimated positive impact of approximately $0.10 per share related to foreign currency translation. EPS on a GAAP basis for 2024 included the amounts described under the heading “Non-GAAP Exclusions” later in this release. EPS on a non-GAAP basis for 2024 excluded these amounts.

Interest expense is projected to increase to approximately $85 million compared to $67 million in 2024, primarily due to the impact of funding the accelerated share repurchase agreements discussed above.

Effective tax rate is projected to be approximately 22 percent on a non-GAAP basis.

Second Quarter 2025 Guidance

  • Revenue: Projected to increase low single digits compared to the second quarter of 2024, flat to increase slightly on a constant-currency basis.
  • EPS: Projected to be in a range of $1.85 to $2.00 on a non-GAAP basis compared to $2.80 on a GAAP basis and $3.01 on a non-GAAP basis in the second quarter of 2024. The second quarter 2025 EPS projection includes an estimated negative unmitigated impact related to the tariffs currently in place for goods coming into the U.S. of approximately $0.20 per share. The impact of foreign currency translation on second quarter 2025 EPS is not expected to be material.
  • Interest expense is projected to increase to approximately $25 million compared to $19 million in the second quarter of 2024 primarily due to the impact of funding the accelerated share repurchase agreements discussed above.
  • Effective tax rate is projected to be approximately 20 percent on a non-GAAP basis.

The company is unable to project full year 2025 operating margin and full year and second quarter 2025 EPS and effective tax rate on a GAAP basis without unreasonable efforts as there are significant uncertainties with respect to the amount and timing of the restructuring costs to be incurred during 2025 in connection with the Growth Driver 5 Actions defined later in this release. As such, the company is unable to provide a full reconciliation of its full year 2025 operating margin and full year and second quarter 2025 EPS and effective tax rate guidance on a non-GAAP basis to the corresponding measures on a GAAP basis. See Non-GAAP Exclusions below for items recorded in the first quarter of 2025.

Image courtesy Tommy Hilfiger