TLDR
- Victoria’s Secret exceeded both Q4 earnings and revenue forecasts, delivering $2.77 EPS compared to the anticipated $2.52
- Quarterly revenue climbed 8% year-over-year, reaching $2.27 billion
- The company achieved positive comparable sales growth for three consecutive quarters — its longest winning streak in four years
- Annual sales forecast of $6.85B–$6.95B surpassed the Street’s $6.8B projection
- Shares tumbled more than 6% during premarket hours despite impressive performance
Victoria’s Secret delivered an impressive holiday-quarter performance, surpassing Wall Street expectations on both the top and bottom lines. However, market participants weren’t buying it — shares plunged over 6% during Thursday’s premarket session.
The lingerie retailer reported adjusted earnings per share of $2.77, comfortably exceeding the analyst consensus of $2.52. Quarterly revenue reached $2.27 billion, representing an 8% increase from the prior year’s $2.11 billion and topping the $2.23 billion estimate.
The company generated net income of $183.63 million, translating to $2.14 per diluted share. This represents a decline from the year-ago period’s $193.4 million, or $2.33 per share.
For the quarter that concluded on January 31, comparable store sales surged 8%, significantly outpacing the 5.6% gain Wall Street had anticipated, according to StreetAccount.
This achievement represents the third straight quarter of positive comp sales growth — the company’s most extended positive streak in no less than four years, based on FactSet data.
CEO Hillary Super, who assumed leadership approximately 18 months ago, has been orchestrating a comprehensive turnaround centered on merchandise, promotional efforts, and brand positioning. The transformation emphasizes the Pink collection, the beauty segment, and reclaiming leadership in intimate apparel.
“Our customer responded enthusiastically to our product and marketing, as demonstrated by growing new customer acquisition and increased average unit retails,” Super said in a statement.
Forward Outlook Exceeds Projections
For the first quarter, management anticipates revenue between $1.49 billion and $1.53 billion, surpassing Wall Street’s $1.42 billion expectation.
Full-year revenue guidance ranges from $6.85 billion to $6.95 billion, exceeding the consensus forecast of $6.8 billion.
Operating income is forecast between $430 million and $460 million, above analyst estimates of $421 million.
The company’s outlook presumes tariffs remain unchanged at present levels — prior to the Supreme Court’s decision to invalidate several broader Trump-era trade levies. Import duties impacted adjusted operating income by approximately $85 million throughout fiscal 2025.
DailyLook Faces Potential Divestiture
Victoria’s Secret announced it has initiated a strategic evaluation of DailyLook, a styling platform obtained through the Adore Me acquisition in 2022.
The company characterized DailyLook as a “non-core asset.” Strategic reviews of this nature typically result in divestiture.
Additionally, the retailer recorded $119.6 million in impairment charges associated with Adore Me assets during the quarter.
Management noted that fiscal 2026 began with robust Valentine’s Day results, with positive trends extending into the current period.
VSCO shares had gained 11% year-to-date and approximately 194% over the trailing 12 months entering Thursday’s trading session.
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