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Levi Strauss Jumps on Earnings and Revenue Beat

Levi Strauss third-quarter revenue moved up 41% year over year and 3% from the 2019 period.

Shares of Levi Strauss  (LEVI) - Get Levi Strauss & Co. Class A Report jumped on Thursday after the apparel maker reported stronger-than-expected third-quarter results and raised its outlook.

The San Francisco company reported adjusted earnings of 48 cents a share as revenue jumped 41% year over year to $1.5 billion. Revenue rose 3% from the 2019 quarter.

Analysts surveyed by FactSet were expecting earnings of 38 cents a share on revenue of $1.48 billion. 

The earnings compared with 8 cents a share in the year-earlier period and 38 cents in the comparable 2019 quarter.

The results reflect "improving momentum in our direct-to-consumer business," and the company's supply-chain network "executed against macro headwinds exceptionally well," Chief Executive Chip Bergh said in a statement. 

Adjusted gross margin was 57.5%, up 3.9 percentage points from third-quarter 2020 and 4.5 points from Q3 2019.

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Levi Strauss also raised its revenue and profit outlook as a result of the stronger-than-expected quarter. 

For the fourth quarter, earnings are expected to range 38 cents to 40 cents a share. Analysts polled by FactSet are expecting earnings of 40 cents a share.

The company now expects revenue to grow 20% to 21% year over year, which would be growth of 6% to 7% from fourth-quarter 2019. 

Levi Strauss shares at last check were 3.7% higher at $25.13. 

The company reported that some stores closed temporarily due to the resurgence of Covid-19 cases and lockdowns. During the worst of the pandemic, most all of the retail industry closed all stores.

About 10% of Levi Strauss's company-operated stores globally were closed during the quarter. Primarily, the closings were in Asia, where the company said customer counts remained low.