VF Corporation (VFC) reported fiscal second-quarter results were about in line with Wall Street estimates, with revenue coming in slightly better than expected, while earnings fell a little bit shy of expectations. The big news is that the apparel company is withdrawing its previous 2024 earnings and revenue guidance and has announced a turnaround strategy called "Reinvent." Yahoo Finance Live explains the details of the report.
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Video Transcript
- Let us also talk about VF Corp, which is also just out with these numbers. And let me just cut to the chase here. The company is withdrawing its guidance. That is why you are seeing the shares down about 7% here in the after-hours session.
Now, it talks a lot about-- in the release about project Reinvent. The company has a new CEO, relatively new CEO, Bracken Darrell, who's talking about his first 100 days at the company and the transformation he is trying to push here. In constant currency-- revenue down 4%, revenue down 2%-- excluding that effect to about $3 billion, it's pretty much in line with estimates, adjusted earnings per share just missing by a penny here. But again, the company is withdrawing that forecast. So that is what's going on here. I'm continuing to look in release here to see exactly what's going on and why they are making this withdrawal.
- So-- yeah. So VF-- obviously, parent company of North Face-- stock has been--
- And Vans.
- Yeah. Stock has been a total mess, right? The CEO, Bracken Darrell, took the reins over the summer in July. Heading into this print, it's-- analysts who cover it were saying, listen, sentiment is very negative. Most analysts heading into this print-- like, 48%-- were at a hold. But the stock has been a real underperformer. And no surprise-- that has attracted the activist investors. So specific-- Legion Partners and Engaged Capital have circled.
- Yeah. And it's interesting that they've circled and they're pushing for changes with a new, relatively new, CEO at the helm. Just a few more details here-- even though the company is withdrawing revenue and earnings guidance, it's given free cash flow guidance. And that's not good. It's cutting that free cash flow guidance to about $600 million, compared with $900 million previously.
What is it blaming on this? Vans performance, it says, is probably not going to get better in the second half of the year. And they're also pointing to a more difficult US wholesale environment. So those are the two major factors here behind what's going on.
We always talk about, like, how these things touch us. Do you have a lot of North Face and Vans gear?
- I have no North Face and Vans gear.
- Yeah?
- No. I'm not anti-North Face or Vans at all. In fact, I welcome it. But no, there's none of that in the [INAUDIBLE] closet right now.
[CHUCKLING] I mean, Hanukkah is coming up. I don't know.
- You never know. Maybe you're going to get a-- maybe you get a pair of skater-- skate shoes. You never know.
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VF Corp. stock tumbles, withdraws 2024 earnings guidance - Yahoo Finance
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