The company’s EMEA segment saw a revenue rise of 5%, fuelled by both wholesale and direct-to-consumer channels. In the Americas, revenues climbed by 7%, predominantly due to wholesale operations.
Conversely, APAC revenues experienced a 13% decline in the same quarter, with an approximate 3% drop ascribed to the timing of the Lunar New Year holiday.
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Tommy Hilfiger brand revenues increased by 3% in Q1 FY25, while Calvin Klein’s revenues remained unchanged from the prior year.
PVH’s owned and operated store revenues fell by 5%, whereas digital commerce revenues from owned and operated platforms rose by 3%.
PVH Corp chief executive officer Stefan Larsson stated “In Q1, we continued to tap into the global consumer love for Calvin Klein and Tommy Hilfiger, delivering revenue growth versus last year and ahead of guidance.
“Calvin Klein saw one of its most impactful product launches in years with the Icon Cotton Stretch franchise, amplified by the viral Bad Bunny campaign. Tommy Hilfiger tapped into its lifestyle DNA with rich product storytelling around seasonal newness of Tommy classics to drive growth and built momentum for the brand’s collaboration with the biggest movie launch of the summer: F1 The Movie.”
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By GlobalDataPVH’s key metrics in Q1 FY25
PVH reported a net loss of $44.8m over the quarter (Q1), compared to net income of $151.4m recorded a year earlier. This translates to a diluted net loss per common share of $0.88 compared to earnings per share of $2.59 previously.
Gross profit also saw a downturn, settling at $1.16bn compared to $1.19bn in Q1 FY24.
Gross margin decreased to 58.6% in Q1 FY25, down from 61.4% in the prior year period, reflecting changes in channel mix, increased promotional activity, transition costs related to in-house wholesale business for women’s products previously licensed out, and higher freight costs coupled with additional discounts offered to customers due to delivery delays in Calvin Klein products.
PVH recorded a loss before interest and taxes of $332m, which includes a $4m negative impact from foreign currency translation, compared to earnings before interest and taxes (EBIT) of $205m in the prior year period.
On a non-GAAP basis, EBIT was reported at $160m, inclusive of the aforementioned $4m negative impact from currency translation, marking a decrease from $195m in the prior year period due largely to gross margin declines.
PVH’s full year and second quarter outlook
Looking ahead to the full fiscal year 2025, PVH maintains its revenue outlook suggesting flat growth or a slight increase on a constant currency basis.
The projected operating margin is approximately 8.5% on a non-GAAP basis, revised from an earlier forecast suggesting flat growth or slight improvement compared to 10% on a non-GAAP basis for fiscal year 2024.
Earnings per share (EPS) are anticipated to be between $10.75 and $11.00 on a non-GAAP basis, adjusted from previous projections ranging between $12.40 and $12.75.
The updated outlook considers an estimated net negative impact from existing US tariffs on imported goods and an estimated positive impact of roughly $0.10 per share due to foreign currency translation.
In the second quarter of fiscal year 2025, PVH projects revenue growth in the low single digits compared to Q2 FY24 and EPS is forecasted to range between $1.85 and $2.00 on a non-GAAP basis versus GAAP-based EPS of $2.80 and non-GAAP EPS of $3.01 in Q2 FY24.
PVH chief financial officer Zac Coughlin said: “We are navigating a highly dynamic and uncertain macroeconomic environment that is impacting our industry, our consumers, and our business results.
“We are reaffirming our revenue guidance for the year but are decreasing our outlook for profitability and earnings per share to reflect that backdrop and the current performance of our business. Our focus remains on taking proactive measures, including investing in cut-through marketing campaigns and delivering increasing cost efficiencies through execution of our Growth Driver 5 multi-year cost savings initiative, that will improve our trajectory in the second half.”
PVH turnaround plan delivers “promising” results
GlobalData senior apparel analyst Pippa Stephens says Q1 “signals the success of its PVH+ plan, which aims to develop its key growth categories, increase consumer engagement and improve efficiencies, and is an encouraging sign for the year ahead”.
She points out the more pessimistic outlook for its profitability is based on tariffs being expected to create further strain given the company has “not yet announced any price rises to counteract increased costs”.
She continues: “The wider US apparel market remained resilient during the quarter, as many consumers pulled spend forward ahead of expected tariff-induced price rises, with sales anticipated to be more challenging once these hit down. EMEA sales grew by 4%, with shoppers in the region likely appreciating the quality of its premium products as they focus on value for money amid economic struggles. Conversely, APAC saw a considerable decline of 11%. While 3% of this was reportedly due to the timing of Lunar New Year, it also continued to see weak demand in China, as sales of premium and luxury goods remain squeezed. This region could see further pressure throughout the year, as US tariffs could hinder consumer perceptions of brands with a heavy American identity.
“Tommy Hilfiger witnessed the strongest brand uplift of 3.4%, with growth in both the Americas and EMEA. This is largely due to it being up against very weak comparatives, when it declined 9.9%, though it has also been aided by its collaborations with Sofia Richie Grainge and F1 The Movie, which have helped to drive consumer awareness. Calvin Klein saw a minor decline of 0.1%, having remained more buoyant last year due to the essential nature of its products. Despite a previous focus on growing its direct-to-consumer (DTC) operations, this channel stalled in Q1, falling 3.5%. This was dragged down by a 4.9% decline in stores, while online grew 3.4%, with consumers appreciating the ability to easily compare prices via this channel as their spending remains restrained. Its wholesale operations rose 6.2%, helped by previously licensed categories moving in-house, and some shipments moving forward from H2.”
