Shares of Victoria's Secret & Co. surged 40% on Wednesday after the company reported a first-quarter earnings beat and raised its full-year sales outlook. The stock jumped to $38.81 in afternoon trading, marking its biggest single-day gain in over a year.
The company posted adjusted earnings of $0.85 per share for the three months ended May 2, exceeding the analyst consensus of $0.61 per share, according to Refinitiv data. Revenue came in at $1.41 billion, slightly above the $1.39 billion estimate. In a sign of confidence, management raised its full-year sales forecast to a range of $5.9 billion to $6.1 billion, up from earlier guidance.
CEO Hillary Super, who took the helm last October, credited the turnaround to a new marketing strategy targeting younger shoppers. "We are seeing strong response from Gen Z and millennial consumers across all income brackets," she said on the earnings call. The company has launched new product lines, revamped its loyalty program and expanded its size-inclusive offerings to recapture market share lost to rivals like Savage X Fenty and Lively.
Analysts at Barclays upgraded the stock to Overweight, noting the earnings beat was broad-based with strength in both stores and e-commerce. However, some bearish voices on Wall Street caution that the company still faces margin pressure from higher cotton and labor costs, and that a single beat does not yet confirm a sustained recovery in a highly competitive lingerie sector.