PVH Corp. Shares Rise on Strong Q2 Earnings Beat
Owner of Calvin Klein and Tommy Hilfiger surpasses revenue and profit estimates, driven by strong growth in the Americas.
PVH Corp. (NYSE: PVH) reported second-quarter financial results that surpassed analyst expectations, sending a positive signal to investors after the market closed on Tuesday. The parent company of iconic brands Calvin Klein and Tommy Hilfiger announced adjusted earnings per share of $2.52, comfortably beating the consensus estimate of $2.19.
Revenue for the quarter reached $2.17 billion, a 4% increase from the prior year and ahead of the $2.12 billion anticipated by Wall Street. The strong performance was largely fueled by an 11% surge in its Americas segment, particularly within the wholesale business. This growth helped offset challenges in the APAC region, which saw a 1% revenue decline amid a difficult consumer environment in China.
"In the second quarter, through our disciplined execution of our PVH+ Plan, we continued to lean further into Calvin Klein and Tommy Hilfiger’s iconic brand strength and we grew revenue 4% with better-than-expected non-GAAP EBIT margins,” said Stefan Larsson, Chief Executive Officer of PVH Corp.
Despite the top-line beat, the company experienced a dip in its gross margin to 57.7% from 60.1% a year earlier, a change attributed to increased promotional activity and higher tariffs. The company’s non-GAAP EBIT was $178 million.
Buoyed by the strong quarter, PVH raised its full-year revenue outlook, now expecting a low single-digit increase, while reaffirming its previous non-GAAP earnings guidance. Management and investors will have the opportunity to discuss the results in more detail during a conference call scheduled for Wednesday morning. The report suggests that the company's strategic focus on its core brands is effectively navigating a mixed global retail landscape.