Investing.com -- Shares in Victoria's Secret tumbled by more than 30% in premarket U.S. trading after the lingerie retailer unveiled soft sales guidance fueled by waning apparel demand.
The company predicted that current-quarter net sales would decrease in the mid-single digits compared to a total of $1.41 billion in the year-ago period. Adjusted operating income, meanwhile, was seen in a range of $10 million to $35 million. Analysts were looking for a net sales of $1.4B, representing decline of about 0.5%.
Adjusted operating income for the 2024 fiscal year was expected to be about $250M to $275M on net sales of roughly $6.0B, representing a low-single digit decline versus 2023. Analysts were expecting net sales of $6.18B.
"As we look into the new year, we recognize the broader intimates market in North America has been down for four consecutive quarters and we are planning the business appropriately conservative in the near-term," said Chief Executive Officer Martin Waters (NYSE:WAT) in a statement.
In a note to clients, analysts at BMO Capital Markets said that the initial annual outlook assumes that trading conditions will remain under pressure throughout the first six months of the year before stabilizing in the second half.
For the three months ended Feb. 3, Victoria's Secret posted adjusted earnings per share (EPS) of $2.58 on revenue of $2.08B, compared with Wall Street projections of $2.45 and $2.09B.
Yasin Ebrahim contributed to this report.