Levi's Profits Soar on Revenue Growth, Dockers Sale Boost

TL;DR

**LEVI's is back in style, ditching Dockers for a massive profit surge and buying back shares – time to go long!**

AI Summary

Levi Strauss & Co. reported a significant increase in net income for the three and nine months ended August 31, 2025. Net income surged to $218.1 million for the three-month period, up from $20.7 million in the prior year, and to $420.1 million for the nine-month period, compared to $28.0 million in the previous year. This substantial growth was driven by a 6.95% increase in net revenues to $1,543.4 million for the three months and a 5.47% increase to $4,516.2 million for the nine months. Operating income saw a dramatic rise, reaching $167.4 million for the quarter, a 411.9% increase from $32.7 million, and $467.0 million for the nine months, a 761.6% increase from $54.2 million. Key business changes include the sale of the Dockers business, which was reclassified as discontinued operations, contributing $96.1 million in net income from discontinued operations for the three months. The company also initiated an accelerated share repurchase program of $120.0 million and declared cash dividends of $0.14 per share for the quarter. Risks include increased restructuring charges of $8.6 million for the quarter and $22.1 million for the nine months, alongside a decrease in cash and cash equivalents by $77.2 million to $612.8 million. The strategic outlook involves focusing on its core Levi's Brands business and the Beyond Yoga brand, while winding down the Denizen brand.

Why It Matters

This filing reveals a strong financial turnaround for Levi Strauss & Co., driven by robust revenue growth and a strategic divestiture. The significant increase in net income and operating income, coupled with the sale of the Dockers brand, signals a focused approach on core brands like Levi's and Beyond Yoga, potentially enhancing long-term profitability and competitive positioning against rivals like VF Corporation. Investors should note the accelerated share repurchase program, which indicates management's confidence and commitment to shareholder returns. Employees might see increased stability and investment in the remaining brands, while customers could experience renewed focus and innovation in Levi's and Beyond Yoga products. The broader market will observe how this strategic streamlining impacts the apparel sector.

Risk Assessment

Risk Level: medium — While net income and operating income saw significant increases, the company experienced a $77.2 million decrease in cash and cash equivalents, from $690.0 million to $612.8 million, over the nine-month period. Additionally, restructuring charges increased to $22.1 million for the nine months ended August 31, 2025, up from $3.4 million in the prior year's comparable quarter, indicating ongoing operational adjustments that could incur further costs.

Analyst Insight

Investors should consider the strong earnings growth and strategic divestiture as positive indicators for LEVI's future performance. The accelerated share repurchase program suggests management believes the stock is undervalued. Monitor the integration of the Beyond Yoga brand and the performance of the core Levi's Brands business for sustained growth.

Financial Highlights

debt To Equity

Not explicitly stated

revenue

$4,516.2M

operating Margin

10.34%

total Assets

$6,656.4M

total Debt

$1,042.8M

net Income

$420.1M

eps

Not explicitly stated for the period

gross Margin

62.11%

cash Position

$612.8M

revenue Growth

+5.47%

Revenue Breakdown

Key Numbers

• $218.1M — Net Income (3 months) (Increased from $20.7M in prior year, a 953% jump)
• $420.1M — Net Income (9 months) (Increased from $28.0M in prior year, a 1400% jump)
• $1.54B — Net Revenues (3 months) (Increased 6.95% from $1.44B in prior year)
• $4.52B — Net Revenues (9 months) (Increased 5.47% from $4.28B in prior year)
• $167.4M — Operating Income (3 months) (Increased 411.9% from $32.7M in prior year)
• $467.0M — Operating Income (9 months) (Increased 761.6% from $54.2M in prior year)
• $96.1M — Net Income from Discontinued Operations (3 months) (Significant contribution from Dockers sale)
• $120.0M — Accelerated Share Repurchase (Indicates management confidence and shareholder return focus)
• $612.8M — Cash and Cash Equivalents (Decreased by $77.2M from $690.0M at December 1, 2024)
• $22.1M — Restructuring Charges (9 months) (Increased from $171.6M in prior year, but still a notable expense)

Key Players & Entities

• LEVI STRAUSS & CO. (company) — Registrant and apparel company
• Dockers (company) — Brand sold and reclassified as discontinued operations
• Beyond Yoga (company) — Brand managed separately and growing
• Denizen (company) — Brand being discontinued
• $218.1 million (dollar_amount) — Net income for the three months ended August 31, 2025
• $420.1 million (dollar_amount) — Net income for the nine months ended August 31, 2025
• $1,543.4 million (dollar_amount) — Net revenues for the three months ended August 31, 2025
• $4,516.2 million (dollar_amount) — Net revenues for the nine months ended August 31, 2025
• $167.4 million (dollar_amount) — Operating income for the three months ended August 31, 2025
• $120.0 million (dollar_amount) — Accelerated share repurchase

FAQ

Risk Factors

• Restructuring Charges [medium — operational]: The company incurred $8.6 million in restructuring charges for the three months ended August 31, 2025, and $22.1 million for the nine months ended August 31, 2025. While lower than the $171.6 million in the prior year's nine-month period, these charges indicate ongoing efforts to streamline operations which can impact profitability.
• Decreasing Cash Position [medium — financial]: Cash and cash equivalents decreased by $77.2 million to $612.8 million as of August 31, 2025, from $690.0 million at December 1, 2024. This reduction, coupled with a $120.0 million accelerated share repurchase, suggests a strategic deployment of capital that lowers immediate liquidity.
• Brand Portfolio Changes [medium — operational]: The company is actively managing its brand portfolio by selling the Dockers business and winding down the Denizen brand, while focusing on Levi's Brands and Beyond Yoga. These strategic shifts, while potentially beneficial long-term, introduce execution risks and may impact short-term revenue streams.
• Inventory Management [medium — market]: Inventories increased to $1,286.3 million as of August 31, 2025, from $1,131.3 million at December 1, 2024. A significant increase in inventory levels can pose a risk if demand falters, leading to potential markdowns and reduced profitability.
• Long-Term Debt Increase [low — financial]: Long-term debt increased to $1,042.8 million as of August 31, 2025, from $994.0 million at December 1, 2024. While the company's debt-to-equity ratio is not explicitly provided, an increase in debt requires careful management of interest expenses and repayment obligations.

Industry Context

Levi Strauss & Co. operates in the highly competitive global apparel market, facing established brands and fast-fashion retailers. Key trends include a growing demand for sustainable and ethically produced clothing, the increasing importance of e-commerce channels, and the need for agile supply chains to respond to rapidly changing consumer preferences. The company's strategic focus on its core Levi's brand and the premium Beyond Yoga brand aims to capitalize on these trends.

Regulatory Implications

As a publicly traded company, Levi Strauss & Co. must comply with SEC regulations, including timely and accurate financial reporting under U.S. GAAP. Changes in accounting standards, such as those related to leases (ASC 842), impact financial statement presentation. Potential regulatory scrutiny could arise from international trade policies, labor practices in its supply chain, and environmental, social, and governance (ESG) reporting requirements.

What Investors Should Do

1. Monitor the integration and performance of the Beyond Yoga brand.
2. Analyze the impact of the Dockers divestiture on future profitability and cash flow.
3. Evaluate the effectiveness of the share repurchase program.
4. Assess inventory levels and management strategies.

Key Dates

• 2025-07-31: Closing of Dockers business sale (U.S. and Canada operations) — Reclassified Dockers as discontinued operations, contributing to a significant net income boost from discontinued operations ($96.1M for the quarter).
• 2025-08-01: Initiated accelerated share repurchase program of $120.0 million — Demonstrates management's confidence and commitment to returning capital to shareholders, reducing outstanding shares.
• 2025-08-31: End of the third quarter for fiscal year 2025 — Reporting period for the 10-Q, showing substantial increases in net revenue, operating income, and net income compared to the prior year.
• 2026-01-31: Expected closing of remaining Dockers operations sale — Further completes the divestiture of the Dockers brand, allowing the company to fully focus on its core Levi's and Beyond Yoga brands.
• 2026-Q1: Expected final settlement of accelerated share repurchase — Completion of the $120.0 million share buyback program, with the final number of shares dependent on market prices.

Glossary

Discontinued Operations

A component of a business that has been sold, disposed of, or is classified as held for sale, and that represents a separate major line of business or geographical area of operations. (The Dockers business was reclassified as discontinued operations, significantly boosting reported net income for the period.)

Accelerated Share Repurchase (ASR)

A transaction where a company buys back its own stock from the open market, often through an intermediary, with the goal of reducing the number of outstanding shares and returning value to shareholders. (Levi Strauss & Co. initiated a $120.0 million ASR, indicating management's confidence and a strategy to enhance shareholder value.)

Restructuring Charges

Costs associated with significant reorganizations or changes within a company, such as layoffs, facility closures, or business divestitures. (The company recorded $22.1 million in restructuring charges for the nine months ended August 31, 2025, reflecting ongoing operational adjustments.)

Operating Lease Right-of-Use Asset

An asset recognized under ASC 842 for the right to use an underlying asset for the lease term, arising from operating leases. (These assets, totaling $1,129.7 million, are significant liabilities and represent the company's long-term rental commitments for facilities and equipment.)

Goodwill

An intangible asset that arises when one company acquires another for a price greater than the fair market value of its net assets. (The company holds $278.8 million in goodwill, primarily from past acquisitions, which is subject to impairment testing.)

Year-Over-Year Comparison

Compared to the prior year's comparable periods, Levi Strauss & Co. has demonstrated significant financial improvement. Net revenues for the nine months ended August 31, 2025, increased by 5.47% to $4,516.2 million, and operating income saw a dramatic surge of 761.6% to $467.0 million. This strong performance is largely attributed to the strategic divestiture of the Dockers business, which was reclassified as discontinued operations, contributing $96.1 million in net income for the quarter. While restructuring charges remain a notable expense ($22.1 million for nine months), they are substantially lower than the $171.6 million reported in the prior year's nine-month period, indicating progress in operational efficiency. However, cash and cash equivalents have decreased by $77.2 million, and inventory levels have risen, presenting areas for continued investor focus.

Key Financial Figures

• $0.001 — which registered Class A Common Stock, $0.001 par value per share LEVI New York Stock

Filing Documents

• lvis-20250831.htm (10-Q) — 2449KB
• lvis08312025ex-311.htm (EX-31.1) — 9KB
• lvis08312025ex-312.htm (EX-31.2) — 9KB
• lvis08312025ex-321.htm (EX-32.1) — 7KB
• 0000094845-25-000050.txt ( ) — 10758KB
• lvis-20250831.xsd (EX-101.SCH) — 47KB
• lvis-20250831_cal.xml (EX-101.CAL) — 102KB
• lvis-20250831_def.xml (EX-101.DEF) — 338KB
• lvis-20250831_lab.xml (EX-101.LAB) — 692KB
• lvis-20250831_pre.xml (EX-101.PRE) — 537KB
• lvis-20250831_htm.xml (XML) — 1895KB

— FINANCIAL INFORMATION

PART I — FINANCIAL INFORMATION

Consolidated Financial Statements (unaudited)

Item 1. Consolidated Financial Statements (unaudited): Consolidated Balance Sheets as of August 3 1, 2025 and December 1, 2024 3 Consolidated Statements of Income for the Three and Nine Months Ended August 3 1, 2025 and August 25 , 2024 4 Consolidated Statements of Comprehensive Income (Loss) for the Three and Nine Months Ended August 3 1, 2025 and August 25 , 2024 5 Consolidated Statements of Stockholders' Equity for the Three and Nine Months Ended August 3 1, 2025 and August 25 , 2024 6 Consolidated Statements of Cash Flows for the Nine Months Ended August 3 1, 2025 and August 25 , 2024 8

Notes to Consolidated Financial Statements

Notes to Consolidated Financial Statements 9

Management's Discussion and Analysis of Financial Condition and Results of Operations

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 32

Quantitative and Qualitative Disclosures About Market Risk

Item 3. Quantitative and Qualitative Disclosures About Market Risk 63

Controls and Procedures

Item 4. Controls and Procedures 63

— OTHER INFORMATION

PART II — OTHER INFORMATION

Legal Proceedings

Item 1. Legal Proceedings 64

Risk Factors

Item 1A. Risk Factors 64

Unregistered Sales of Equity Securities and Use of Proceeds

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 64

Defaults Upon Senior Securities

Item 3. Defaults Upon Senior Securities 64

Mine Safety Disclosures

Item 4. Mine Safety Disclosures 64

Other Information

Item 5. Other Information 65

Exhibits

Item 6. Exhibits 66 SIGNATURE 67 WHERE YOU CAN FIND MORE INFORMATION Investors and others should note that we announce material financial information to our investors using our corporate website, press releases, SEC filings and public conference calls and webcasts (including our Investor Relations page at http://investors.levistrauss.com). We also use the following social media channels as a means of disclosing information about our company, products, planned financial and other announcements, attendance at upcoming investor and industry conferences and other matters, as well as for complying with our disclosure obligations under Regulation FD promulgated under the Securities Exchange Act of 1934, as amended. our X account (previously Twitter account) (https://X.com/LeviStraussCo); our company blog (https://www.levistrauss.com/unzipped-blog/); our Facebook page (https://www.facebook.com/levistraussco/); our LinkedIn page (https://www.linkedin.com/company/levi-strauss-&-co-); our Instagram page (https://www.instagram.com/levistraussco/); and our YouTube channel (https://www.youtube.com/user/levistraussvideo). The information we post through these channels may be deemed material. Accordingly, investors should monitor these channels in addition to following our press releases, SEC filings and public conference calls and webcasts. This list may be updated from time to time. The information we post through these channels is not a part of this Quarterly Report. Table of Contents

— FINANCIAL INFORMATION

PART I — FINANCIAL INFORMATION

CONSOLIDATED FINANCIAL STATEMENTS

Item 1. CONSOLIDATED FINANCIAL STATEMENTS LEVI STRAUSS & CO. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (Unaudited) August 31, 2025 December 1, 2024 (Dollars in millions) ASSETS Current Assets: Cash and cash equivalents $ 612.8 $ 690.0 Short-term investments in marketable securities 94.7 — Trade receivables, net 722.9 710.0 Inventories 1,286.3 1,131.3 Other current assets 232.4 211.7 Current assets held for sale 57.7 108.1 Total current assets 3,006.8 2,851.1 Property, plant and equipment, net 677.4 687.4 Goodwill 278.8 277.6 Other intangible assets, net 194.7 196.6 Deferred tax assets, net 808.1 798.5 Operating lease right-of-use assets, net 1,129.7 1,065.5 Other non-current assets 541.8 463.9 Non-current assets held for sale 19.1 34.9 Total assets $ 6,656.4 $ 6,375.5 LIABILITIES AND STOCKHOLDERS' EQUITY Current Liabilities: Accounts payable $ 621.4 $ 663.4 Accrued salaries, wages and employee benefits 224.5 234.2 Accrued sales returns and allowances 212.5 193.4 Short-term operating lease liabilities 261.1 247.4 Other accrued liabilities 659.5 672.1 Total current liabilities 1,979.0 2,010.5 Long-term debt 1,042.8 994.0 Long-term operating lease liabilities 987.1 943.0 Long-term employee related benefits and other liabilities 484.8 457.5 Total liabilities 4,493.7 4,405.0 Commitments and contingencies Stockholders' Equity: Common stock — $ 0.001 par value; 1,200,000,000 Class A shares authorized, 102,602,359 shares and 103,984,741 shares issued and outstanding as of August 31, 2025 and December 1, 2024, respectively; and 422,000,000 Class B shares authorized, 288,227,197 shares and 291,411,568 shares issued and outstanding, as of August 31, 2025 and December 1, 2024, respectively 0.4 0.4 Additional paid-in capital 761.2 732.6 Retained earnings 1,806.4 1,672.0 Accumulated other comprehensive loss ( 405.3 ) ( 434.5 ) Total stockholders' equity 2,162.7 1,970.5 Total liabilities and stockholders' equity $ 6,656.4 $ 6,

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS FOR THE QUARTERLY PERIOD ENDED AUGUST 31, 2025 NOTE 1: SIGNIFICANT ACCOUNTING POLICIES Nature of Operations Levi Strauss & Co. (the "Company") is one of the world's largest brand-name apparel companies. The Company designs, markets and sells – directly or through third parties and licensees – products that include jeans, casual and dress pants, activewear, tops, shorts, skirts, jackets and related accessories for men, women and children around the world under the Levi's , Levi Strauss Signature, Denizen , Dockers and Beyond Yoga brands. In the fourth quarter of 2024 we announced we were undertaking an evaluation of strategic alternatives to the global Dockers business, including a sale or other strategic transactions. During the second quarter of 2025, the Company entered into a definitive agreement to sell its Dockers business. The transaction is subject to customary closing conditions and closed on July 31, 2025 for the Dockers intellectual property and operations in the U.S. and Canada, and is expected to close on or around January 31, 2026 for the remaining Dockers operations. Dockers net assets were classified as held for sale in the consolidated balance sheets for all periods presented. Additionally, the Company classified the Dockers business as discontinued operations in its consolidated statements of income for all periods presented. See Note 2 "Discontinued Operations". The Dockers business is a separate operating segment historically presented in our financial statements under the caption of Other Brands. The Company operates its business according to three reportable segments: Americas, Europe, and Asia, collectively comprising the Company's Levi's Brands business, which includes the Levi's , Levi Strauss Signature and Denizen brands. In the first quarter of 2024 the Company announced the strategic decision to discontinue the Denizen brand with the wind down of operations substantially complete as of Mar

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (continued)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (continued) FOR THE QUARTERLY PERIOD ENDED AUGUST 31, 2025 Distribution Center Conversion On June 6, 2024, the Company entered into an agreement to replace certain of the Company's legacy U.S. distribution centers with a new third party logistics center. The Company maintains certain rights over the warehouse, and warehouse equipment and technologies which resulted in an Operating lease right-of-use asset and lease liability of $ 30.6 million in "Operating lease right-of-use assets, net" and "Short-term Operating lease liabilities" and "Long-term Operating lease liabilities" balances and a Financing lease right-of-use asset and lease liability of $ 14.0 million in "Other non-current assets" and "Long-term employee related benefits and other liabilities" balances on the consolidated balance sheets during 2024. In the first quarter of 2025, the Company recorded an additional Financing lease right-of-use asset and lease liability of $ 61.6 million in "Other non-current assets" and "Long-term employee related benefits and other liabilities" balances on the consolidated balance sheets. Long-Lived Assets The Company reviews its long-lived assets for impairment whenever events or changes in circumstances indicate the carrying amount of an asset may be impaired. Impairment losses are measured and recorded for the excess of carrying value over its fair value, estimated based on expected future cash flows and other quantitative and qualitative factors. Property, plant and equipment, net includes accumulated depreciation of $ 1.3 billion as of both August 31, 2025 and December 1, 2024. In the third quarter of 2024, the Company recorded $ 11.1 million of asset impairment charges related to technology projects discontinued in connection with Project Fuel, which were recorded in "Selling, general and administrative expenses" in the consolidated statements of income. The Company also recorded an impairment charge of $ 9.1 millio

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (continued)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (continued) FOR THE QUARTERLY PERIOD ENDED AUGUST 31, 2025 Share Repurchases During the first quarter of 2025, the Company repurchased 1.6 million shares for $ 30.0 million, plus broker's commissions, in the open market. On August 1, 2025, the Company entered into an accelerated share repurchase transaction with a third-party financial institution to repurchase an aggregate of $ 120.0 million of the Company's Class A common stock as part of its share repurchase program. At inception, the Company made an initial payment of $ 120.0 million and took delivery of approximately 5.0 million shares of Class A common stock, representing 80% of the dollar amount of the transaction, based on the August 1, 2025 closing share price, over the transaction's term (the "ASR Agreement"). The initial shares received, which had an aggregate cost of $ 96.0 million based on the August 1, 2025 closing share price, were retired and recorded as a reduction of Retained Earnings, with the remainder of $ 24.0 million recorded as a reduction of additional paid-in capital. These purchases equate to an average repurchase price of approximately $ 19.05 per share for the nine months ended August 31, 2025. The total number of shares the Company will ultimately repurchase will be based on the volume-weighted average price per share of the Company's Class A common stock over the term of the ASR Agreement, less an agreed upon discount, and subject to customary adjustments pursuant to the terms and conditions of the ASR Agreement. Final settlement of the transactions under the ASR Agreement is expected to occur no later than the first quarter of 2026. During the three and nine months ended August 25, 2024, the Company repurchased 1.0 million and 3.3 million shares for $ 17.8 million and $ 59.7 million, plus broker's commissions, respectively, in the open market. This equates to an average repurchase price of approximately $ 18.35 per share for the nine m

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (continued)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (continued) FOR THE QUARTERLY PERIOD ENDED AUGUST 31, 2025 NOTE 2: DISCONTINUED O

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