Apparel giant PVH credits strong consumer connection with its top two brands for Q3 upside surprise.
In labeling the pricing power and performance of Calvin Klein and Tommy Hilfiger “hero products” the New York-based global apparel conglomerate said it was able to navigate a tricky macroeconomic environment that saw improved interest in all its offerings.
“Our strong performance reflects the power of our two global iconic brands, Calvin Klein and Tommy Hilfiger, and the pricing power we are able to achieve by delivering strong hero product, engaging closely with consumers and elevating the customer experience,” PVH CEO Stefan Larsson said in the Q3 earnings release.
During the quarter, the company’s revenue decreased 2% year over year, but increased 7% on a constant currency basis and exceeded guidance, according to the release.
Thursday morning (Dec. 1), PVH shares were up about 8% on the news, extending a nearly 40% rally over the past month.
The company said its ‘hero products’ are especially important to its efforts to build its presence in the United States but are key in other regions as well as they increase customer engagement, brand awareness, product differentiation and premium positioning.
The word “hero” appears 23 times in the PVH Investor Day 2022 presentation.
In that publication, the company said the No. 1 item on its list of growth drivers was creating the best hero products on the market. “Win with product,” it said, explaining the growth drivers in its PVH+ Plan
“Iconic hero products drive growth through trusted quality, newness and excitement each season,” PVH said in the presentation.
Looking ahead, PVH said its full-year revenue outlook is in line with the top end of its previous guidance range, as it’s expected to decrease 3% but increase 4% on a constant currency basis.
“Through the PVH+ Plan, we seek to tap into our full potential by focusing on our core strengths and connecting our iconic brands closer to where the consumer is going that any time before,” Larsson said in the release. “Our goal is to win with the consumer and achieve long-term profitable growth.”
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