Levi Strauss CEO Michelle Gass told CNBC’s Jim Cramer on Wednesday how the denim retailer will benefit from its partnership with Beyoncé, saying the ads could help boost sales of women’s clothing.
“Levi’s has been talking about women’s for quite some time. We see this as growing to at least half of our business, doubling over time, $2 billion even just this year,” Gass said. “Now you bring Beyoncé into the ecosystem, you know, we think we’re just set up for the long term really, really well.”
Levi’s officially launched the first part of a new ad campaign with the iconic pop star on Monday. The collaboration comes after Beyoncé released her newest album, “Cowboy Carter,” in the spring that featured a track called “LEVII’S JEANS.” Levi’s has worked with the singer on other occasions over years, including during her time in Destiny’s Child in the early 2000s.
While Gass pinpointed women’s a “bright spot” in the business, she also explained some of the headwinds the company has faced over the past quarter. Levi’s posted earnings after close on Wednesday, missing Wall Street’s expectations for revenue and trimming its revenue guidance. The stock dipped more than 9% in extended trading.
She described problems with the company’s business in China, Mexico and with its Dockers brand. She said the Levi’s faced some of its “own executional issues” in the two countries, but that the retailer is addressing them. Difficulties in China were exacerbated by the macro environment in the economy, she added. She claimed wholesale, a large part of Levi’s business in Mexico, was down because one of the company’s “key customers” had a cybersecurity breach that impacted shipping. Gass also said that the Dockers brand has “underperformed for some time,” and Levi’s intends to sell the business.
“We’re expecting sequential improvement into the fourth quarter, being up mid-single digits and carrying that through into ’25,” she said.
