Dive Brief:
- PVH Corp. netted $2.2 billion in revenue for its second quarter, a 4% year-over-year increase driven by its Tommy Hilfiger and Calvin Klein businesses, the company reported in its earnings Tuesday.
- The North American segment of Calvin Klein saw a 9% revenue decrease, which the company attributed to a decrease in the wholesale business, which dropped 3% overall.
- By contrast, Tommy Hilfiger North America increased revenue 4%. Calvin Klein International saw a jump in revenue by 11%.
Dive Insight:
PVH saw increased revenue in its international business overall, particularly in the Asia Pacific region, including a 20% growth in China after the lifting of COVID-19 restrictions.
“The pace of PVH's domestic recovery is highly uncertain, since it is predicated upon a return of foreign tourism (an unknown variable) and inventory stocking levels by wholesale partners,” Tom Nikic and Austin Borina, analysts for Wedbush wrote in emailed comments.
The analysts also noted PVH may have work to do to drive “brand heat” in North America, which could present risks to the recovery.
Last year, the company unveiled its PVH+ Plan, a multi-year strategic plan to boost consumer brand loyalty for its Tommy Hilfiger and Calvin Klein businesses and lead the company to a total revenue of $12.5 billion in 2025, among other financial targets. CEO Stefan Larsson said in Tuesday’s release that the Q2 results reflected this plan.
“As we lean into the five key growth drivers of the PVH+ Plan, we’re continuing to gain traction by connecting our consumer-facing execution with an increasingly demand-driven operating engine to fuel long-term profitable growth,” Larsson said.
The DTC business also saw increased revenue of 11%, with growth in both the company’s owned and operated stores and digital commerce platforms.
PVH’s heritage brand business decreased revenue by 11%. In 2021, the company sold certain intellectual property and other assets in the heritage brands business to Authentic Brands Group, including Izod, Van Heusen and Arrow for $223 million.
The company reaffirmed a projected 3% to 4% revenue increase for the full 2023 fiscal year.
