Victoria's Secret & Co. reported a significant increase in financial performance for the first quarter of fiscal year 2026, ending May 2, 2026. The company achieved net sales of $1.560 billion, a 15% increase from $1.353 billion in the same period of the previous year. This growth was driven by an 11% rise in North American store sales and an 8% increase in direct sales. International sales surged by 45%, reflecting strong performance in China and other markets. The company's gross profit also rose to $585 million, up from $474 million, with a gross profit margin of 37.5%, compared to 35.1% in the prior year.
Operating income for the first quarter of 2026 reached $76 million, a substantial increase from $20 million in the first quarter of 2025. The operating income rate improved to 4.9% from 1.5%, primarily due to higher net sales and improved merchandise margins. The company reported net income attributable to Victoria's Secret & Co. of $48 million, compared to a net loss of $2 million in the previous year. This translated to a net income per diluted share of $0.56, a significant turnaround from a loss of $0.02 per share in the first quarter of 2025.
In terms of operational developments, Victoria's Secret & Co. continues to focus on its strategic growth initiatives, including enhancing its product offerings and expanding its market presence. The company has approximately 860 stores across the U.S., Canada, and China, along with over 560 franchise and partner-operated stores in around 70 countries. The company also announced a restructuring of its executive leadership team to better align with its growth strategy. Additionally, the company repurchased $100 million worth of its common stock during the quarter, reflecting its commitment to returning value to shareholders.
The company's balance sheet showed total assets of $4.770 billion as of May 2, 2026, down from $5.013 billion at the end of the previous fiscal year. Current liabilities decreased to $1.286 billion from $1.507 billion, while long-term debt stood at $986 million, slightly reduced from $971 million. The company reported cash and cash equivalents of $207 million, down from $518 million at the end of the previous quarter, primarily due to cash used for operating and financing activities.
Looking ahead, Victoria's Secret & Co. remains optimistic about its growth trajectory, emphasizing its commitment to product innovation and enhancing customer experiences. The company is also navigating challenges related to tariffs and market conditions, which have impacted operating income. Despite these challenges, management believes that the strategic initiatives in place will position the company for sustainable long-term value creation.
About Victoria's Secret & Co.
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