Victoria's Secret & Co.'s stock was up 4.1% in extended trading Wednesday after the intimate-apparel company swung to a profit in its second-quarter results and raised its 2024 sales outlook, boosted by North American sales.
The company reported net income of $32 million, or 40 cents a share, after a net loss of $1 million, or a loss of 2 cents a share, in the prior year's quarter. On an adjusted basis, earnings were 40 cents a share, above the FactSet analyst consensus of 37 cents a share.
Net sales were $1.417 billion, down 1% from $1.427 billion a year earlier, but in line with the FactSet consensus of $1.408 billion.
"We were encouraged by the continued sequential improvement in quarterly sales results in North America for the fourth consecutive quarter, as sales trends improved in both our stores and digital channels," said Timothy Johnson, Victoria's Secret's interim chief executive, in a statement.
"Our customers responded to new merchandise deliveries and events with particular success in the launch of our Victoria's Secret Dream bra collection, in apparel with our Pink Friday back-to-campus event in late July and consistent, steady improvement of VS sport as merchandise flowed to stores and digital."
"While we are optimistic about the positive signs we're seeing in our business, we recognize the consumer environment remains challenging and our customer is pressured economically," Johnson added.
Comparable sales decreased 3% during the second quarter. Analysts surveyed by FactSet were looking for a same-store sales decline of 2.3%.
Victoria's Secret $(VSCO)$ raised its full-year outlook and is now expecting 2024 net sales to be down approximately 1%, from its prior guidance of down by low single digits.
The company is forecasting third-quarter net sales to increase by low single digits compared to $1.265 billion in the same period last year. On an adjusted basis, Victoria's Secret expects a third-quarter loss of 60 cents to 80 cents a share; analysts surveyed by FactSet were looking for a third-quarter loss of 69 cents a share.
Victoria's Secret shares are up 38.7% in 2024, outpacing the S&P 500 index's SPX gain of 17.2%.
