VF Corp 1Q26 Immediate Call Postmortem
Main focus of this call was to talk about the return to growth. Three things: 1) not happy with Vans growth and focused on it, 2) goal is to get The North Face to double digit growth, 3) sustain momentum in Timberland. When Boss asked about potential for any new reset actions they explicitly said that was behind them. This is what you want to hear management say if you are trying to determine if the trough is behind us.
Speaking of growth, Altra on track to do $250 mm this year (up from $60 mm on acquisition). Bracken said it’s the kind of business that they can scale and I would agree with that.
Bracken says there are “many out there that think Vans will never improve”. Well I am not in that camp but am certainly not the biggest fan of the idea The North Face can ever build a meaningful Spring/Summer business. Its like a unicorn as have heard this story for 2+ decades now from countless brands like Columbia Sportswear, Canada Goose, etc. Maybe, just maybe, Deckers is showing signs of getting there with UGG but only after trying for the aforementioned 2+ decades. Bracken was bulled up though in his answer to Binetti’s question though.
“We changed reporting to make it easier for investors to track performance.” LOL. Its pretty consensus that Dickies is terrible and should be divested ASAP. Of course this would be a step in that direction. Just amazing how VF mismanaged this brand (former management) vs. Carhartt.
Where did I go wrong with my life? Used to work with Vogel in research. I’m still doing that and now he is jetting off to Orlando to hang out at the WARP tour.
Thank you, Bracken! When asked about tariff elasticity he said “Nobody really knows. This is unusual circumstance where the whole industry is impacted equally. Hard to model.” This is why people love this guy – why can’t more CEO’s just speak honestly about topics like this? He even went further: “Everybody’s wondering why is the economy so great with tariffs but it’s probably because they haven’t yet shown up in peoples cost.”
As far as elasticity, sound like their base case is one for one price to unit volume. Could be a little better than that given nature of tariff on everyone’s cost.
Come on Vogel – you need to remember the data points you give. Not that big of a deal but last quarter you said 60% of the Vans decline was deliberate, not 50%. This quarter that amount was lower at 40%.
Regarding current conversations with partners, around the world they see a little hesitation from wholesalers to overextend themselves on inventory. Traffic has slowed. Especially around this period with tariffs you see conservatism.
I really wish somebody on the sell-side asked a question about the consistency of the timing shift this quarter. What brand? What product? What geography? Anything? Anything? Bueller?
*These are my unabridged quick thoughts and notes from the call. I get them out as soon as possible after the call ends. Management has given some topics to dig deeper into and will circle back in several days with a more comprehensive work up as well as detailed scenario analysis of how consensus numbers shook out.
Originally posted on X and Substack.