Victoria’s Secret & Co. has reported a first-quarter performance that exceeded analyst expectations on nearly every metric, with net sales rising 15 percent to $1.56 billion and comparable sales up 13 percent. The results sent shares of the intimates retailer soaring 47 percent to $79.86 in a single session — a blistering rate of ascent that reflects both the magnitude of the beat and the market’s hunger for evidence that the brand’s multi-year turnaround strategy is producing tangible results.
The earnings report, released after market close on June 2, revealed an operating income of $76 million, with adjusted operating income reaching $80 million — figures that represent a dramatic improvement over the same period last year, when the company was still absorbing the costs of its post-spin restructuring. The company raised its full-year guidance, now projecting net sales between $6.85 billion and $7.13 billion, compared to the $6.65 billion consensus estimate. CEO Hilary Super, who took the helm in late 2023, described the quarter as evidence that the brand’s repositioning is gaining traction with consumers.
The first-quarter results suggest that the brand may be threading that needle. Sales growth was driven by strength in bras — the company’s foundational category — as well as the Pink youth-oriented sub-brand and the growing swim category. The company also cited the success of its expanded loyalty program, which now counts over 10 million active members, and the performance of its new store format, which emphasizes a warmer, more inviting aesthetic than the dark, club-like atmosphere of the legacy stores. Notably, the sales growth was broad-based across channels, with both stores and e-commerce contributing.
The market’s 47-percent reaction underscores how deeply the outlook for Victoria’s Secret had been discounted. The stock had been trading at levels that implied skepticism about the brand’s ability to return to growth in a category — intimate apparel — that has seen new entrants from direct-to-consumer disruptors like ThirdLove and Skims, as well as increased competition from the activewear and loungewear segments that blur the line between underwear and outerwear. Victoria’s Secret’s Q1 proves that the brand, for all its cultural baggage, still commands a level of consumer loyalty and operational scale that its smaller competitors cannot match.
