06:39 AM EDT, 07/11/2025 (MT Newswires) -- Levi Strauss (LEVI) shares climbed early Friday as the denim maker lifted its full-year earnings and sales outlook on the back of stronger-than-expected fiscal second-quarter results.

The apparel company now anticipates adjusted earnings to be in a range of $1.25 to $1.30 per share for fiscal 2025, up from its previous guidance of $1.20 to $1.25, it said late Thursday. The current consensus on FactSet is for $1.27. The stock jumped 7% in Friday's most recent premarket activity.

Revenue is pegged to grow by 1% to 2% for the ongoing fiscal year, compared with the company's prior forecast for a decline of 1% to 2%. On an organic basis, sales are now expected to increase by 4.5% to 5.5% versus the previous outlook for growth of 3.5% to 4.5%.

"Given the upside in the first half of the year, continued strong execution and momentum in our business, we are raising our top and bottom line guidance," Chief Financial Officer Harmit Singh said during an earnings call, according to a FactSet transcript. "While there's still uncertainty on the macros, largely driven by tariffs, we are in a good position to mitigate the adverse impact given our brand, product and profitability momentum."

Gross margin is now estimated to increase by 80 basis points, down from the prior guidance for a 100-basis-point increase, due to a 20-basis-point headwind from tariffs after the company's mitigation efforts. The outlook assumes US duties on Chinese imports to remain at 30% and for the rest of the world at 10%.

The US and China last month confirmed details of a trade framework that would allow exports of rare earths and ease technology curbs. Earlier this week, US President Donald Trump sent letters to 14 nations, including Japan, South Africa, Malaysia and Thailand, informing them of their new reciprocal tariff rates, effective Aug. 1. He also announced on Wednesday 50% tariffs on Brazilian imports beginning next month.

"Our key mitigation initiatives include promotion optimization, targeted pricing actions, vendor negotiations and further supply chain diversification," Singh said on the call. "Looking beyond 2025, should tariffs remain in place at these levels given our transformation initiatives, which provides us multiple levers, we believe we are better positioned than most to manage through this uncertainty."

For the three months ended June 1, Levi Strauss' adjusted EPS increased to $0.22 from $0.16 the year before, topping the Street's view for $0.13. Revenue inclined 6% to $1.45 billion, ahead of the average analyst estimate of $1.37 billion. Organic sales advanced 9% on a yearly basis.

The direct-to-consumer channel saw sales climb 11%. E-commerce jumped by 13% while wholesale net revenue improved by 3%. Gross margin rose by 140 basis points year over year to 62.6% during the quarter, boosted by lower product costs and favorable channel mix.

"We delivered another standout quarter, exceeding expectations across sales, margins and EPS," Chief Executive Michelle Gass told analysts on the call. "We saw broad based revenue growth across channels and categories, as well as strong margin expansion driven by the consistent execution of our strategic priorities."

The denim maker anticipates adjusted EPS to come in between $0.28 and $0.30 for the ongoing quarter, including a net impact from tariffs of $0.01, Singh said on the call. The market's current estimate is for non-GAAP EPS of $0.30. Revenue is projected to grow by 3% to 4% and 4% to 5% on reported and organic bases, respectively, while gross margin is expected to be flat to up 30 basis points, the CFO added.