- VF Corp withdrew its full-year revenue and profit forecasts on Monday, with demand for its higher-priced apparel and footwear easing as customers turn more cost conscious, especially in the United States.
High borrowing costs and still-high inflation have forced shoppers to move away from pricier products and spend their dollars mainly on essentials. VF Corp's margins have taken a hit from excessive discounts and promotions it has offered to attract shoppers as well as clear surplus inventory.Sales in Americas, its biggest market, fell 11% in the reported quarter, but rose 8% in Greater China helped by a rebound in demand after the COVID-19 pandemic.
VF Corp, which has come under pressure from activist investor firms Engaged Capital and Legion Partners Asset Management, said it does not expect Vans brands' performance to improve in the second half, and also expects a difficult U.S. wholesale environment.
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VF Corp Withdraws Full-Year Forecasts as Demand for Higher-Priced Apparel SlowsVF Corp has withdrawn its full-year revenue and profit forecasts due to a decrease in demand for its higher-priced apparel and footwear, particularly in the United States. The company's second-quarter profit was also lower than expected. High borrowing costs and inflation have caused consumers to prioritize essential purchases over pricier products. VF Corp's margins have been affected by discounts and promotions to attract customers and clear surplus inventory. Sales in the Americas fell 11%, but rose 8% in Greater China. The company does not anticipate an improvement in the performance of its Vans brands in the second half of the year.
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