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PVH
Earnings call · Jul 2026 (Q2 FY27)

PVH Q2 FY27 earnings call PVH

Sep 3, 2026 Source

Executive summary

PVH Q2 FY27 — Strong D2C Growth and Profitability Beat Amidst Macro Headwinds

PVH delivered a strong second quarter, meeting revenue guidance and exceeding profitability expectations, driven by robust D2C and e-commerce performance in the Americas and APAC. The company continues to execute its PVH Plus plan, focusing on brand relevance, product innovation, and cost discipline, while navigating a challenging macro environment, particularly in EMEA wholesale. Management reaffirmed its full-year outlook, emphasizing strategic investments and operational efficiency.

Highlights

5

  • Achieved revenue guidance and beat on profitability, with operating margin at 11.1% and EPS at $3.70.

  • Gross margin, excluding tariff refunds, improved year-over-year by approximately 20 basis points and was above expectations.

  • D2C business showed momentum, led by growth in APAC and Americas, with e-commerce traffic up double digits for Calvin Klein and high single digits for Tommy Hilfiger.

  • Inventory levels were down 3% year-over-year, with improved stock freshness.

  • Calvin Klein Denim global sales rose double digits, with women's jeans a standout, driving strong gross margins and double-digit AURs.

Concerns

5

  • EMEA wholesale channel remained under pressure, reflecting a challenging environment, with revenue down 6% in reported and constant currency.

  • Spring '27 order book for Europe is down mid-single digits due to cautious wholesalers.

  • Wholesale revenue was down 6% in both reported and constant currency, primarily driven by EMEA.

  • Licensing business revenue was down 13% due to North America license transitions, though the ongoing business grew low single digits.

  • Recognized a noncash goodwill impairment charge of $439 million due to changes in valuation assumptions.

Guidance & targets

CategoryTargetConfidence
Full-year reported revenue
Approximately flat to prior year
high materiality
High
Full-year constant currency revenue
Down slightly
high materiality
High
Full-year operating margin
Approximately 8.8%
high materiality
High
Full-year EPS
$11.80 to $12.10
high materiality
High
Full-year e-commerce growth
Growth in all regions
medium materiality
High
Full-year gross margin
Increase approximately 100 basis points
high materiality
High
Full-year SG&A as a percent of revenue
Increase approximately 100 basis points
high materiality
High
Full-year marketing spend as percent of sales
At least 50 basis points increase to approximately 6% of sales
medium materiality
High
Full-year net interest expense
Approximately $70 million
low materiality
High
Full-year tax rate
22% to 23%
low materiality
High
Full-year capital spending
Approximately $250 million
medium materiality
High
Full-year share repurchases
At least $300 million
medium materiality
High
Q3 reported revenue
Down low single digits
high materiality
High
Q3 constant currency revenue
Down low single digits
high materiality
High
Q3 Americas revenue
Up mid-single digits
medium materiality
High
Q3 APAC revenue (constant currency)
Relatively flat
medium materiality
High
Q3 EMEA revenue (constant currency)
Down mid-single digits
medium materiality
High
Q3 Licensing business revenue
Down mid-single digits
medium materiality
High
Q3 gross margin
Increase approximately 100 basis points
high materiality
High
Q3 SG&A expense as percent of revenue
Increase over 200 basis points
high materiality
High
Q3 operating margin
Approximately 7.5%
high materiality
High
Q3 EPS
$2.50 to $2.65
high materiality
High
Q3 tax rate
Approximately 22%
low materiality
High
Q3 interest expense
Approximately $18 million
low materiality
High
Cost savings run rate
Approximately $45 million annualized
medium materiality
High
Overall licensing business growth
Growth to continue
low materiality
Medium
Operating margins
Significant improvements
high materiality
Medium

Segment performance

SegmentRevenueYoYQoQMargin
Americas
DTC growth driven by e-commerce, partially offset by wholesale decline due to shipment timing impacting Calvin Klein, and partially offset by license transitions for Tommy Hilfiger North America.
DTC: Up slightlyE-commerce: Up high single digitsWholesale: Down low single digits
Down 1%-1%——
APAC
DTC strength led by stores, while wholesale partners remained cautious. Australia saw improvement despite macro headwinds.
Constant currency revenue: Up 1%DTC (constant currency): Low single digits growth, led by storesE-commerce: Down slightly (on track for full year growth)Wholesale (constant currency): Mid-single digits declineChina e-commerce (constant currency): Mid-single-digit growth
Up 3%+3%——
EMEA
Reflects continued macro pressure and lower consumer demand due to conflict in the Middle East. E-commerce grew in both brands, and DTC improved compared to Q1.
Constant currency revenue: Down 6%DTC (constant currency): Low single digits decline (improved vs Q1)E-commerce: Mid-single digits growthWholesale (constant currency): High single digits decline
Down 6%-6%——
Licensing
Decline expected due to North America license transitions. The go-forward business continues to grow.
Ongoing licensing business growth (excluding North America transitions): Low single digits
Down 13%-13%——
Tommy Hilfiger
Includes approximately 3 percentage point increase from wholesale sell-in of previously licensed women's product categories in Americas.
Constant currency revenue: FlatRevenue excluding transition impact: Down approximately 3%
FlatFlat——
Calvin Klein
Includes approximately 4 percentage point decrease attributable to wholesale shipment timing in Americas.
Constant currency revenue: Down 7%Revenue excluding timing impact: Down approximately 3%
Down 7%-7%——

Risks & headwinds

Challenging macro environment and consumer demand uncertainty Ongoing, impacting Q2 and expected to continue into H2 FY27 and Spring '27

Revenue down 3% reported and constant currency in Q2; EMEA wholesale down 6% reported and constant currency; Spring '27 Europe order book down mid-single digits.

Mitigation:Continued cost discipline, balanced investments, focus on D2C growth, closer collaboration with wholesale partners, in-season replenishment, leveraging D2C insights for wholesale.

Geopolitical and macroeconomic factors impacting valuation assumptions Q2 FY27 (impact recognized)

Noncash goodwill impairment charge of $439 million.

Mitigation:Not explicitly stated as a forward mitigation, but implies ongoing monitoring of global conditions.

Tariff rates uncertainty Ongoing, impacting Q4 FY27 and beyond

New tariff rates recently announced, situation remains fluid; Q4 gross margin guidance embeds support for volatility.

Mitigation:Closely monitoring developments, working hand-in-hand with partners, actively managing mitigation efforts.

Promotional holiday landscape Q4 FY27

Q4 gross margin guidance gives flexibility to strategically support a promotional holiday landscape.

Mitigation:Strategic planning and flexibility embedded in financial outlook.

What to watch in Q3 FY27

EMEA wholesale order book for Spring '27

Next quarter (Q3 FY27) for further updates on mitigation effectiveness
Current Down mid-single digits
Target Stabilization or improvement

Why it matters

This indicates future wholesale revenue trends in a key region and the effectiveness of management's mitigation strategies (closer partner collaboration, in-season replenishment).

European wholesalers are understandably cautious, and this is reflected in our Spring '27 order book which is down mid-single digits.

Q&A highlights

Can you elaborate on the ROI seen from recent high-profile marketing campaigns and activations, specifically mentioning Travis Kelsey's dog?

Stefan Larsson highlighted strong leading indicators like double-digit e-commerce traffic growth for Calvin Klein and high single-digit for Tommy Hilfiger. He provided examples of campaign success, such as Tate McRay's Calvin Klein denim campaign achieving 14% social engagement and 96% of views from non-followers, and Travis Kelsey's Tommy Hilfiger campaign generating 1 billion social impressions in 24 hours and a 500% increase in Instagram views. He attributed this to increased brand relevance, targeted consumer acquisition, and focus on key categories.

“So the key leading indicator is we see strong, as I mentioned in my prepared remarks, we see strong traffic growth. Consumer acquisition is really strong, targeted to our Power segment, the standard shopper and the style enthusiasts.”

asked by Robert Drbul · answered by Stefan Larsson

2 min read 7 chapters

Detailed narrative

PVH Plus Plan Progress and Strategic Focus

PVH continues to make meaningful progress on its multiyear PVH Plus plan, building momentum despite a dynamic environment. The plan focuses on sharpening consumer focus, delivering stronger products, engaging consumers with 360 marketing, and improving the marketplace experience in both D2C and wholesale. Key initiatives include targeting Gen C and younger millennials, with investments showing early signs of acquiring and retaining high-quality, loyal consumers.

D2C and E-commerce Strength

The D2C business, particularly e-commerce, remains a significant source of strength. Calvin Klein's online traffic was up double digits, and Tommy Hilfiger's was up high single digits. This growth was led by APAC and Americas, with strong AUR expansion and disciplined execution. Even in EMEA, where wholesale faced pressure, e-commerce grew mid-single digits, demonstrating the effectiveness of brand-building efforts.

Product Innovation and Hero Categories

The company is seeing strong results from focusing on hero categories. Calvin Klein Denim global sales rose double digits, with women's jeans being a particular standout, driving very strong gross margins and double-digit AURs. Calvin Klein underwear also saw low single-digit global growth with mid-single AUR improvement. Tommy Hilfiger's D2C growth was driven by sweaters (up double digits) and shirts/polos (up mid-single digits), with linen categories rising over 30% across all regions.

Marketing Effectiveness and Cultural Moments

Strategic increases in marketing spend in the first half of the year, combined with a sharper consumer focus, delivered low single-digit e-commerce growth and improved online search share. Notable campaigns include the John Cook for Calvin Klein collaboration, which generated $5 billion in social media reach and over 90% global sell-through, and the Travis Kelsey campaign for Tommy Hilfiger, which garnered 1 billion social impressions in 24 hours and a 500% increase in Instagram views versus last fall.

Cost Management and Efficiency Initiatives

PVH is extending beyond one-time cost actions to embed a culture of systematic cost discipline. This includes globalizing and centralizing indirect procurement to optimize spend and driving enterprise-wide cost management by spend category. These efforts have already confirmed annualized run rate savings of approximately $45 million, with full realization expected in 2027, without compromising brand-building investments.

Licensing Business Strategy

The licensing business, generating over $350 million in annual revenue, is a significant and profitable revenue stream. The transition of the women's North America wholesale business is on plan for substantial completion by the end of 2026. Excluding this transition, the ongoing licensing portfolio grew low single digits, with expectations for overall licensing business growth starting in 2027 by leveraging strategic partnerships and core brand strength.

Goodwill Impairment Charge

The company recognized a noncash goodwill impairment charge of $439 million in the second quarter. This charge reflects changes in valuation assumptions, which were primarily associated with geopolitical and macroeconomic factors impacting the business.

AI-generated summary of the company's earnings call. Not investment advice.