Levi Strauss & Co. ($LEVI) Stock: Shares Fall 8% Despite Strong Q3 Revenue Growth and Higher Full-Year Guidance

TLDR

• Levi Strauss stock trades at $22.46, down 8.43% after Q3 results.
• Company reports high single-digit revenue growth for the fourth straight quarter.
• Direct-to-consumer sales up 9%; e-commerce up 16%.
• Gross margin expanded by 110 basis points to 61.7%.
• Full-year revenue and EPS guidance raised despite tariff and cost headwinds.

Levi Strauss & Co. (NYSE: LEVI) shares traded at $22.46, down 8.43% in early trading on October 10, 2025, even as the company delivered another quarter of strong performance.

Levi Strauss & Co. (LEVI)

The jeans and apparel giant posted high single-digit organic revenue growth for the fourth consecutive quarter and raised its full-year revenue and earnings outlook.

For the quarter, adjusted diluted EPS stood at $0.34, while gross margin expanded by 110 basis points to 61.7%, reflecting effective pricing and strong execution.

Consistent Growth Across Key Markets

Levi’s global momentum continued through Q3, with direct-to-consumer (DTC) sales up 9%, supported by a 16% increase in e-commerce. The DTC-first approach improved profitability and boosted store productivity across markets.

In the U.S., revenue grew 3%, while international business surged 9%, led by Asia’s accelerating demand. Markets such as India, Japan, Korea, and Turkey recorded double-digit growth.

The company’s women’s business remained a bright spot, up 9% in the third quarter and 12% year-to-date, driven by new collections and successful marketing campaigns.

Strategic Initiatives and Shareholder Returns

Levi Strauss declared a $0.14 dividend per share, up 8% year-over-year, underscoring its commitment to shareholder value. The company returned $151 million to shareholders during the quarter, a 118% increase compared to the previous year.

The company continues to invest in its DTC channel and product innovation to strengthen brand equity and expand its global presence.

Challenges: Tariffs and Distribution Costs Weigh on Margins

Despite the positive results, Levi Strauss faces challenges. Higher tariffs are projected to reduce full-year gross margins by 70 basis points. The company also cited higher distribution costs tied to transitioning to a new distribution network, impacting near-term profitability.

The U.S. wholesale business is expected to decline in the fourth quarter due to last year’s strong comparison and the absence of a 53rd week. Meanwhile, Europe saw weaker foot traffic in June and July due to unfavorable weather conditions.

Financial and Market Performance

Levi Strauss remains a strong long-term performer, with its year-to-date return at 31.46%, outperforming the S&P 500’s 14.74%. Over the past three years, the stock gained 69.85%, while its five-year return stands at 64.15%.

Despite short-term headwinds, Levi’s consistent revenue expansion, growing DTC presence, and margin resilience underline its strategic strength in the global apparel market.

Levi Strauss & Co. reported its Q3 2025 earnings on October 10, 2025. Investors will closely watch Q4 performance as the company navigates tariff pressures and evolving consumer demand.

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