Shares of Levi Strauss (NYSE:LEVI) tumbled 9% on Wednesday after the company reported second-quarter results that beat analyst expectations on the top line but missed the consensus forecast by $0.03 per share on the bottom line.
The jeans maker saw a 62% drop in sales to $498 million as the coronavirus pandemic forced retailers to close their stores, but Levi Strauss was able to salvage some of the quarter with a 25% jump in e-commerce sales. Online sales also surged 80% in May compared to April.
However, year-ago profits ended up turning into a loss of $191.5 million, or $0.48 per share, missing Wall Street's prediction of a $0.45-per-share loss.
CEO Chip Bergh said Levi Strauss started the year off strong, but could not withstand the tide of the global COVID-19 crisis, which "had a significantly negative impact on our second-quarter results, as our stores and most wholesale doors were closed around the world for the majority of the quarter."
With retail stores slowly reopening, the company is picking up and store productivity is approaching 80% of last year's performance. Even so, e-commerce remains strong, with sales up 70% in June compared to 2019.
However, Levi Strauss also announced the firing of 700 employees, or about 15% of its workforce, in a bid to save $100 million a year.