VF Corp Cuts FY23 Outlook Amid Weaker Q2 & Back-To-School Performance - VF (NYSE:VFC)

VF Corp VFC introduced its FY27 long-term strategic growth plan, with revenue five-year compounded annual growth rate (CAGR) up mid- to high single-digit % in constant dollars.
It sees an FY27 operating margin of about 15% by FY27, reflecting both gross margin expansion and SG&A leverage.
FY27 EPS is expected to grow at a five-year CAGR of high single to low double-digit %.
For Q2'FY23, VF Corp expects revenue to be up low single-digit % (in constant dollars) and adjusted EPS to be $0.70 - $0.75 (consensus $1.00).
VF Corp said it is testing the Supreme Trademark and Goodwill values during Q2 due to a triggering event resulting from higher interest rates and foreign currency fluctuations.
As a result, the company expects to record a non-cash charge during Q2 of $300 million - $450 million.
Meanwhile, the company reduced its FY23 outlook citing lower-than-expected Q2 results, ongoing uncertainty in the current environment, weaker than anticipated back-to-school performance at Vans, and increasing inventories urging more promotions in North America in the fall.
It sees total VF revenue up about +5% to 6% (in constant dollars) versus the previous outlook of at least +7%.
The company's Vans brand revenue is expected to be down mid-single digit % (in constant dollars) versus the prior outlook of up mid-single digit %.
VF Corp has cut its FY23 adjusted EPS outlook to $2.60 - $2.70 (consensus $3.04) from the previous guidance of $3.05 - $3.15.
The company also reduced its FY23 adjusted gross margin and adjusted operating margin forecast.
Price Action: VFC shares are trading lower by 3.08% at $33.99 on the last check Wednesday.

Market News and Data brought to you by Benzinga APIs