PVH Corp. Reports Revenue Decline and Strategic Initiatives for Improvement

PVH Corp. reported a decline in financial performance for the thirteen weeks ended November 3, 2024, with total revenue of $2,255.1 million, down from $2,362.9 million in the same period last year. Net income also decreased to $131.9 million, compared to $161.6 million in the prior year, resulting in a diluted net income per share of $2.34, down from $2.66. For the thirty-nine weeks ended November 3, 2024, total revenue was $6,281.3 million, a decrease from $6,727.8 million, while net income increased to $441.3 million from $391.8 million, reflecting a diluted net income per share of $7.74, up from $6.29.

The company experienced significant changes in its revenue streams, particularly in its Heritage Brands Wholesale segment, which saw net sales drop to $60.3 million from $130.8 million year-over-year, following the divestiture of its women’s intimates businesses under the Warner’s, Olga, and True&Co. trademarks. This transaction, completed on November 27, 2023, generated net proceeds of $155.6 million and resulted in a gain of $15.3 million recorded in the fourth quarter of 2023. Additionally, the company reported a pre-tax gain of $10.0 million in the first quarter of 2024 due to the accelerated realization of the earnout from this sale.

Operationally, PVH Corp. has been focusing on efficiency improvements through its "Growth Driver 5 Actions" initiative, which aims to centralize processes and enhance automation. The company anticipates annual cost savings of approximately $200 million to $300 million by 2026, with actions largely completed by the end of 2025. During the thirty-nine weeks ended November 3, 2024, the company incurred pre-tax costs of $27.5 million related to this initiative, which included severance and termination benefits. The company also sold a warehouse and distribution center, resulting in a pre-tax gain of $9.5 million.

In terms of market dynamics, PVH Corp. reported fluctuations in customer engagement metrics, with wholesale net sales decreasing to $1,203.1 million from $1,301.6 million year-over-year. However, owned and operated retail stores generated $760.0 million in sales, slightly up from $754.7 million. The company continues to navigate challenges posed by global economic conditions, including inflation and supply chain disruptions, but does not expect these factors to materially impact its operations in 2024.

Looking ahead, PVH Corp. remains cautiously optimistic about its financial outlook, with expectations of improved performance driven by strategic initiatives and market recovery. The company is focused on enhancing its brand portfolio and operational efficiencies while managing costs effectively. The ongoing evaluation of its international operations and potential geographic expansions will also play a crucial role in its growth strategy moving forward.