LEVI 10-K & 10-Q changes, risk factors and insider trading

Global economic conditions have impacted, and will likely continue to impact, businesses around the world, including ours. Macroeconomic pressures, including inflation, container shipping disruptions, fluctuations in foreign currency exchange rates, changes in trade policies, and competition for and price volatility of resources created a complex and challenging environment for us in fiscal year 20242025 and may continue to impact us in the future. In particular, inflationary pressures persist and have adversely impacted consumer demand and increased labor and product costs. We continue to pursue ways to mitigate these pressures; however, if we are unable to fully mitigate the pressures, our revenue, operating margins and net income will be impacted in fiscal year 2025.2026.

•Our sales are impacted by discretionary spending by consumers. Declines in consumer spending have resulted and in the future may result in reduced demand for our products, increased inventories, reduced orders from retailers for our products, order cancellations, lower revenues, higher discounts, pricing pressure and lower gross margins.

•We conduct transactions in various currencies, which creates exposure to fluctuations in foreign currency exchange rates relative to the U.S. Dollar. Volatility in the markets and exchange rates for foreign currencies and contracts in foreign currencies has had and may in the future have a significant impact on our reported operating results and financial condition. In particular, rapid strengthening of the U.S. Dollar relative to major foreign currencies, including the Euro and Mexican Peso, unfavorably impacted our fiscal year 2024 results. Continued significant fluctuations of foreign currencies against the U.S. Dollar may further negatively impact our financial results, revenue, operating margins and net income.

•The current domestic and international political environment, including volatile trade relations, conflicts in multiple locations, and the related disruption to shipping lanes and civil unrest have resulted in uncertainty surrounding the future state of the global economy. There is uncertainty with respect to potential further changes in trade policy and regulations, sanctions and export controls, which increase volatility in the global economy and foreign currency exchange rates. This environment has affected and may continue to affect production and distribution lead times, increasing our costs and potentially affecting our ability to meet customer demand. If these disruptions persist, they may require us to modify our current sourcing practices, which may impact our product costs, and, if not mitigated, could have a material adverse effect on our business and results of operations.

•If retailers of our products experience declining revenues or have trouble obtaining financing in the capital and credit markets to purchase our products, this could result in reduced orders for our products, order cancellations, late retailer payments, extended payment terms, higher accounts receivable, reduced cash flows, greater expense associated with collection efforts and increased bad debt expense. In addition, if retailers of our products experience severe financial difficulty, some may become insolvent and cease business operations, which could negatively impact theour salesales and results of our products to consumers.operations. If contract manufacturers of our products or other participants in our supply chain experience difficulty obtaining financing in the capital and credit markets to purchase raw materials or to finance capital equipment and other general working capital needs, it may result in delays or non-delivery of shipments of our products.

•changes in tariffs,trade and tax policies, laws and global trade policiesregulations;

•rapidly changing regulatory restrictions and requirements, including in the areas of data privacy,privacy and security, artificial intelligence, sustainability and responses to climate change, which could result in regulatory uncertainty as well as potential significant increases in compliance costs; and

The functional currency for most of our foreign operations is the applicable local currency. As a result, fluctuations in foreign currency exchange rates affect the results of our operations and the value of our foreign assets and liabilities, including debt, which in turn may adversely affect results of operations and cash flows and the comparability of period-to-period results of operations. Changes in foreign currency exchange rates also affect the relative prices at which we and competitors sell products in the same market. Foreign and domestic governmental policies and actions regarding currency valuation could result in actions, for further actions,actions by other countries and the United States and other countries to offset the effects of such fluctuations. The unpredictability and volatility of foreign currency exchange rates hashave adversely impacted our businesses and financial results in the past and ongoing or unusual volatility may continue to adversely impact us.

We extend credit to our customers based on an assessment of a customer’s financial condition, generally without requiring collateral. ToWe assist in the scheduling of production and the shipping of our products, wealso offer certain customers the opportunity to place orders five to six months ahead of deliverydelivery, under our futures ordering program. These advance orderswhich have in the past and may in the future be canceled underupon certain conditions, and the risk of cancellation may increase when dealing with financially unstable retailers or retailers struggling with economic uncertainty. In the past, some customers have experienced financial difficulties up to and including bankruptcies, which have had an adverse effect on our sales, our ability to collect on receivables and our financial condition. When the retail economy weakens or as consumer behavior shifts, retailers may be more cautious with orders. A slowing or changing economy in our key markets could adversely affect the financial health of our customers, which in turn could have an adverse effect on our results of operations and financial condition. In addition, product sales are dependent in part on high quality merchandising and an appealing retail environment to attract consumers, which requires continuing investments by retailers. Retailers that experience financial difficulties may fail to make such investments or delay them, resulting in lower sales and orders for our products. The ongoing financial uncertainty, particularly for retailers, could also have an effect on our sales, our ability to collect on receivables and our financial condition.

Extreme weather conditions in the areas in which our retail stores, suppliers, manufacturers, customers, distribution centers, offices, headquarters, and vendors are located could adversely affect our operating results and financial condition. Moreover, natural disasters such as earthquakes, hurricanes, wildfires and tsunamis, whether occurring in the United States or abroad, and their related consequences and effects, including energy shortages and public health issues, have in the past temporarily disrupted, and could in the future disrupt, our operations, the shipping channels we use, the operations of and the shipping channels used by our vendors, manufacturers and other suppliers orof raw materials and other goods. Such events have in the past resulted in, and in the future could result in, economic instability that may negatively impact our operating results and financial condition.condition, including due to resulting increases in costs. In particular, if a natural disaster or severe weather event were to occur in an area in which we or our suppliers, manufacturers, customers, distribution centers or vendors are located, our continuedbusiness successcould be negatively affected. The impact would depend, in part, on the safety and availability of the relevant personnel and facilitiesfacilities, andas well as the proper functioning of our or third parties’ disaster relief operations, including computer, network, telecommunication and other systems and operations. In addition, a natural disaster or severe weather event could negatively impact retail traffic to our stores or stores that carry our products or wholesale or DTC fulfillment and could have an adverse impact on consumer spending, any of which could in turn result in negative point-of-sale trends for our merchandise. Natural disasters or severe weather events in regions that produce key raw materials or other inputs for our products, may drive up the prices of those raw materials or constrain the availability of raw materials, adversely affecting our cost of goods. Further, climate change may increase both the frequency and severity of extreme weather conditions and natural disasters, which may affect our business operations, either in a particular region or globally, and the shipping channels we use, as well as the activities of and the shipping channels used by our third-party vendors and other suppliers, manufacturers, and customers. We could incur significant capital expenditures and other costs to improve the climate-related resiliency of our infrastructure and otherwise prepare for, respond to and mitigate the effects of climate change,change includingor complianceregulatory withmandates evolving,related and at times inconsistent, country specific laws and regulations.thereto. In addition, the physical changes prompted by climate change could result in changes in consumer preferences, production capabilities, the productivity of our contract manufacturers, higher insurance premiums and deductibles and the availability of raw materials and costs, which could in turn affect our business, operating results, and financial condition.

We believe the diversity of locations in which we operate, our operational size, disaster recovery, business continuity planning and information technology systems and networks, including the Internet and third-party services position us well, but may not be sufficient for all or for concurrent eventualities. If we were to experience a local or regional disasterdisaster, including near our California global headquarters, or other business continuity event or concurrent events, we could still experience operational challenges, depending upon how a local or regional event may affect our human capital across our operations or regarding particular aspects of our operations, such as key executive officers or personnel. For example, our global headquarters is located in California near major geologic faults that have experienced earthquakes in the past. Further, if we are unable to find alternative suppliers or shipping channels, replace capacity at key manufacturing or distribution locations or quickly repair damage to our information technology systems and networks, including the Internet and third-party services, or supply systems, we could be late in delivering, or be unable to deliver, products to our customers. These events could result in reputational damage, lost sales, cancellation charges or markdowns, all of which could have an adverse effect on our business, results of operations and financial condition.

Pandemics, includingsuch theas emergenceCOVID-19, of new COVID-19 variants, posespose a risk to our business and financial performance, including our ability to execute our near-term and long-term business strategies and initiatives in the expected time frame. The extent of the impact of a pandemic or other health crisis on our business will depend on several factors, including the duration, spread and severity of the pandemic or health crisis, which are uncertain and cannot be predicted, and on the requirements to take action to help limit the spread of the illness and the availability, widespread distribution and acceptance of vaccines and treatments for the pandemic.

Our success depends in large part on the value, overall health and reputation of our brands, which are integral to our business and the implementation of our “Brand Led” strategy for expanding our business. Maintaining, promoting and positioning our brands will depend largely on the success of our marketing, design and merchandising efforts and our ability to provide consistent, high-quality products supported by engaging marketing campaigns. In addition, our success in maintaining, extendingcampaigns and expanding our brand image depends on our abilityadapting to adapt to a rapidly changing media environment,environments, including our increasing reliance on social media and digital dissemination of advertising campaigns on our digital platforms and through our digital experiences.campaigns. Our brands and reputation could be adversely affected if we fail to achieve these objectives, if we fail to deliver high-quality products acceptable to our customers and consumers or if we face or mishandle a product recall.

Our brand value also depends on our ability to maintain a positive consumer perception of our brands, corporate integrity and culture. Negative claims or publicity involving us or our products, our cobranding or collaboration partners, the production methods, materials or locations of any of our suppliers or contract manufacturers, consumer data or any of our key employees, endorsers or suppliers could seriously damage our reputation, sales and brand image, regardless of whether such claims or publicity are accurate. Social media, which accelerates and potentially amplifies the scope of negative claims or publicity, can increase the challenges of responding to negative claims or publicity. In addition, we,the Company, the Levi Strauss Foundation, our senior executives and the descendants of the family of our founder, Levi Strauss, may from time to time take positions or actions (including internal programs) or make statements on or charitable donations to social issues, including donations to the Levi Strauss Foundation (which is not one of our consolidated entities), that may be unpopular with some consumers or customers, which may result in adverse publicity or impact our ability to attract or retain such consumers or customers, and which could adversely impact our results in certain locations. In addition, actions taken or statements made by recipients of such charitable donations could also seriously harm our brand image with consumers. Any harm to our brands and reputation could adversely affect our business and financial condition. Additionally, people or groups who oppose these positions or statements may cause disruptions to our business operations. Adverse publicity, regardless of its accuracy, could undermine consumer confidence in our brands and reduce long-term demand for our products.

The appeal of our brands may also depend on the success of our ESGcorporate sustainability initiatives, which require company-wide coordination and alignment.alignment Weon aremanaging working to managerelated risks and costs to us, our licensees and ourmay supplyultimately chainnot ofbe any effects of climate change as well as diminishing fossil fuel and water resources.successful. Risks related to our ESGcorporate sustainability initiatives include increased public focus, including by governmental and nongovernmental organizations, on these and other environmental sustainability matters, including packaging and waste, animal welfare and land use. Moreover, because of the increased focus from our stakeholders, including consumers, employees and investors, and more recently regulatory organizations, on corporate ESGsustainability practices, including corporate practices related to the causes and impacts of climate change and corporate statements, practices or products related to a variety of social issues, and the rapid evolution of stakeholder expectations and actions with respect to ESG practices and social issues, there is an increased risk of negative public reaction to andto, public backlash against and increased pressure on disclosure related to our initiatives, products or practices related to ESGcorporate sustainability or other social issues that could have an adverse impact on our image, reputation, business operations and financial results. Risks also include increased pressure and regulatory requirements to expand our disclosures in these areas, make commitments, set targets or establish additional goals and take actions to meet them, which could expose us to business, legal, market, reputational, operational and execution costs or risks. The metrics we disclose, such as emissions and water usage, whether they be based on the standards we set for ourselves or those set by others, may influence our reputation and the value of our brand. In addition, as we work to align with the recommendations and requirements of various ratings and disclosure organizations and new and evolving regulations, we will likely expand our disclosures in these areas and, as a result, we may face increased scrutiny related to our ESGsustainability activities. Our failure to achieve progress on our metrics on a timely basis, or at all, could adversely affect our business, financial performance and growth. We could damage our reputation and the value of our brand if we fail to act responsibly in the areas in which we report. Any harm to our reputation resulting from setting these metrics, expanding our disclosure or our failure or perceived failure to meet such metrics or disclosures could adversely affect our business, financial performance and growth.

Our success depends on our ability to attract customers cost effectively. With respect to our marketing channels, we rely heavily on relationships with providers of online services, search engines, social media and other websites and e-commerce businesses to provide content, advertising banners and other links that direct customers to our websites. We also use social media, including Facebook, Instagram, YouTube and others, as well as affiliate marketing, email, SMS, and direct mail, as part of our multi-channel approach to marketing and we expect that our use of social media for marketing purposes will increase over time. We rely on these relationships to provide significant traffic to our website and as important marketing channels and sources of information regarding potential customers. If digital platforms change or penalize us with their algorithms, terms of service, display and featuring of search results, or if competition increases for advertisements, we may be unable to cost-effectively attract customers. Our relationships with digital platforms are not covered by long-term contractual agreements and do not require any specific performance commitments. In addition, many of the platforms and agencies with whom we have advertising arrangements provide advertising services to other companies, including retailers with whom we compete. As competition for online advertising has increased, the cost for some of these services has also increased. A significant increase in the cost of the marketing providers upon which we rely could adversely impact our ability to attract customers cost effectively and harm our business, financial condition, results of operations and prospects. In addition, laws and regulations governing the use of these platforms and other digital marketing channels are rapidly evolving. It may become more difficult for us or our partners to comply with such laws, and future data privacy laws and regulations or industry standardsstandards, as well as related enforcement, may restrict or limit our ability to use some or all of the marketing strategies on which we currently rely. The failure by us, our employees or third parties acting at our direction to abide by applicable laws and regulations in the use of these platforms could adversely impact our reputation or subject us to fines or other penalties.

In addition, if we fail to accurately forecast consumer demand, we may experience excess inventory levels, which may result in inventory write-downs and the sale of excess inventory at discounted prices. This could have an adverse effect on the image and reputation of our brands and could adversely affect our gross margins. For example, if sales do not meet expectations because of unexpected effects on inventory supply and consumer demand, too much inventory may cause excessive markdowns and, therefore, lower-than-planned margins. Conversely, if we underestimate consumer demand for our products, we may experience inventory shortages, which could delay shipments to customers, negatively impact retailer and consumer relationships and diminish brand reputation and loyalty.

Port congestion, inventory delays, labor shortages, and storage and process capacity pressures have previously impacted our ability to service consumer and wholesale customer demand and could impact it again in the future. Uneven flow of receipts and shipments couldhas caused and may continue to cause capacity pressures within our distribution centers and result in higher costs and limit our ability to fulfill our consumers’ and wholesale customers’ demand.demand on a timely basis or at all. In the event these supply chain disruptions reoccur, our business, operating results and financial condition may be adversely affected.

Sales to our top ten wholesale customers accounted for 26%,24%, 28%25% and 31%27% of our total net revenues in fiscal years 2024,2025, 20232024 and 2022,2023, respectively. No single customer represented 10% or more of our net revenues in any of these years. While we have long-standing relationships with our wholesale customers, we do not have long-term contracts with them. As a result, purchases generally occur on an order-by-order basis, and the relationship, as well as particular orders, can generally be terminated by either party at any time. If any major wholesale customer decreases or ceases its purchases from us, cancels its orders, delays or defaults on its payment obligations to us, reduces the floor space, assortments, fixtures or advertising for our products or changes its manner of doing business with us for any reason, such as due to store closures, decreased foot traffic, inflationary pressures or recession, such actions are expected to adversely affect our business and financial condition. During weak economic conditions, such as periods of high inflation, recessionary fears or reduced consumer traffic and purchasing, our wholesale customers may be more cautious with orders or may slow investments necessary to maintain a high quality in-store experience for customers, which may result in lower sales of our products. In addition, competition between our wholesale customers may impact the prices at which they sell our products, thereby impacting the prices at which they are willing to buy products from us. Furthermore, certain of our major wholesale customers may seek to distribute our products globally in a manner or at prices that are different from our regular or promotional guidelines or impact the positioning that we seek to promote in our other channels of distribution.

A decline in the performance or financial condition of a major wholesale customer—including bankruptcy or liquidation—could result in the adverse impact on revenues and cause us to limit or discontinue business with that customer, require us to assume more credit risk relating to our receivables from that customer or limit our ability to collect amounts related to previous purchases by that customer. Permanent store closures and other developments in these proceedings have adversely affected our sales to these customers. We expect additional closures and other developments in these proceedings will likely adversely affect our sales to these customers in the future, even if they continue operations. In addition, store closures, decreased foot traffic, inflationary pressures and recession will adversely affect the performance and will likely adversely affect the financial condition of many of these customers. The foregoing may have an adverse effect on our business and financial condition.

We may not be able to implement important strategic initiatives in accordance with our expectations or that generate expected returns, which may result in an adverse impact on our business and financial results. One of our key strategic priorities is our “DTC First” strategy, which includes our plan to become a leading world-class omni-channel retailer by expanding our consumer reach in brand-dedicated stores globally, including making selective investments in company-operated stores and e-commerce sites, and other brand-dedicated store models. In many locations, we face major, established retail competitors that may be able to better attract consumers and execute their retail strategies. In addition, a retail operating model involves substantial ongoing investments in equipmentproperty, and property,equipment, information systems, inventory and personnel. Due to the high fixed-cost structure associated with these investments, a decline in sales or the closure of or poor performance of stores, including as a result of general declines in the macroeconomic environment, could result in significant costs and impacts to our margins and impairment charges. Our ability to grow our retail channel also depends on the availability and cost of real estate that meets our criteria for foot traffic, square footage, demographics and other factors. Failure to identify and secure adequate new locations, or failure to effectively manage the profitability of the fleet of stores, could have an adverse effect on our results of operations. Our DTC First strategy depends on our ability to successfully drive expansion of our gross margins, manage and leverage our cost structure and drive return on our investments. If we cannot effectively execute our strategy while managing costs effectively, our business could be negatively impacted and we may not achieve our expected results of operations.

Many of our consumers shop with us through our digital platforms or through third party digital marketplaces on which we operate. Consumer expectations and related competitive pressures have increased and are expected to continue to increase relative to various aspects of our e-commerce business, including speed of product delivery, shipping charges, return privileges and other evolving expectations. Increasingly, consumers are using mobile-based devices and applications to shop online with us and with our competitors, and to do comparison shopping, as well as to engage with us and our competitors through digital services and experiences that are offered on mobile platforms. We are increasingly using social media and proprietary mobile applications to interact with our consumers and as a means to enhance their shopping experience. In addition, customers are increasingly using AI shopping assistant tools to help find products, compare prices and make purchase decisions. Use of these AI tools could transform commerce, including in ways that we fail to anticipate, and affect our ability to efficiently attract potential customers to our digital platforms and retain our customer base. Any failure on our part or on the part of our third-party providers to provide attractive, effective, reliable, secure, user-friendly digital commerce platforms that offer a wide assortment of merchandise with rapid delivery options and that continually meet the changing expectations of online shoppers or any failure to provide attractive digital experiences to our customers could place us at a competitive disadvantage, result in the loss of digital commerce and other sales, harm our reputation with consumers, have an adverse impact on the growth of our digital commerce business globally and have an adverse impact on our business and results of operations. In addition, as use of our digital platforms continues to grow, we will need an increasing amount of technical infrastructure to continue to satisfy our consumers’ needs. If we fail to continue to effectively scale and adapt our digital platforms to accommodate increased consumer demand, our business may be subject to interruptions, delays or failures and consumer demand for our products and digital experiences could decline. Risks specific to our digital commerce business also include diversion of sales from our and our retailers’ brick and mortar stores, difficulty in recreating the in-store experience through direct channels and liability for online content.content and data, including liability resulting from failure to comply with certain online platform legal or regulatory requirements. Our failure to successfully respond to these risks could adversely affect sales in our digital commerce business, as well as damage our reputation and brands. We are also subject to a variety of laws and regulations that govern the operations and features of our platforms. These include, but are not limited to, laws and regulations imposing specific requirements on consumer opt-outs, notices and mandates for verification of age of minors. The costs of monitoring and responding to such regulations and the consequences of non-compliance could have an adverse effect on our operations or financial condition.

If we encounter problems with distribution,distribution and the operation of company-owned or third-party distribution facilities, our ability to deliver our products to market could be adversely affected.

We rely on both company-owned and third-party distribution facilities to warehouse and ship products to our wholesale customers, retail stores and e-commerce consumers throughout the world. As part of theour continued pursuit for improved organizational agility and marketplace responsiveness, we have consolidated the number of distribution facilities we rely upon and continue to look for opportunities for further consolidation in certain regions. These actions may make our operations more vulnerable to interruptions in the event of work stoppages or disruption (including as a consequence of public health directives, quarantine policies or social distancing measures imposed by governments),disruption, labor disputes, such as U.S. or foreign labor strikes or boycotts, worker shortages, port congestion, pandemics, macroeconomic conditions, geopolitical conflict, the impacts of climate change, earthquakes, floods, fires or other natural disasters (such as droughts) affecting these distribution centers or shipping channels. Labor laws in the various jurisdictions where our distribution network operates and inflation impacts on labor costs impact our costs of distribution and increase regulatory complexity for us and the third-parties with whom we partner. In addition, distribution capacity is dependent on proper operating technology and the timely performance of services by third parties, including the transportation of products to and from their distribution facilities, which also may be adversely affected by similar events. Any failure by us or our third-party providers to adapt to these events or to otherwise respond adequately to our distribution needs could disrupt our business.

Our distribution system includes computer-controlled and automated equipment, which may be subject to a number of risks related to data and system security or computer viruses, the proper operation of software and hardware, power interruptions or other system failures. Moreover, some of our current distribution centers rely on aging technology.technology, which in some cases is no longer supported and may inhibit our efficiency as well as increase the likelihood of system interruption or failure.

As part of our ongoing effort to optimize our logistics network, we are incontinuing theto process of transitioningtransition the operation of certain of our global distribution and fulfillment centers from owner-operated facilities to third-party logistics providers. This transition has caused, and may continue to cause, interruptions to our business systems and delays in order fulfillment as we transition our systems and technology and restructure our workforce arrangements. We have experienced and may continue at times to experience delays in the adoption or remediation of necessary technology, shortages of labor and capacity constraints and shortfalls. Our lack of system redundancies and inability to efficiently move inventory demands from owner-operatedone facilitiesdistribution center to another, together with our reliance on third-party logistics providers may cause interruptions to these centers as we transition or restructure systems, technology and employees. We may at times experience a shortage of labor, interruptions in our business systems or delays as a result of this transition. Given that, as a result of this transition, third-party logistics providers will satisfy a significant percentage of our global distribution and fulfillment needs,needs means we are subject to concentration risksrisks. andAny anyfurther disruptions, delaysdelays, or otherperformance eventsissues impactingat thecompany-owned business of theor third-party logisticsdistribution providersfacilities maycould havematerially a significant impact on our business, includingaffect our ability to timely fulfill orders.orders and manage inventory. If we continue to encounter such problems with our distribution system, whether company-owned or third-party, our ability to meet customer and consumer expectations, manage inventory, complete sales and achieve operating efficiencies could be further adversely affected.

From time to time, we have acquired and may in the future acquire or invest in businesses or partnerships that we believe could complement our business or offer growth opportunities. We expect to make additional acquisitions and strategic investments in the future, but we may not find suitable acquisition or investment targets, or we may not be able to consummate desired acquisitions or investments due to among other things, financial constraints, unfavorable credit markets, commercially unacceptable terms, failure to obtain regulatory approvals, competitive bid dynamics or other risks, which could harm our operating results. Additionally, acquisitions may not be well received by the customers or employees of either company, and this could hurt our brand and result in the loss of key employees. The pursuitAcquisitions and integrationstrategic investments involve numerous risks, including the diversion of suchour acquisitionsmanagement’s orattention investmentsfrom other business concerns, the possibility that current operating and financial systems and controls may divertbe inadequate to deal with our growth and the attentionpotential loss of managementkey employees. We also may encounter difficulties in integrating any businesses we may acquire with our existing operations. The success of these transactions depends on our ability to successfully merge corporate cultures, operations, and causefinancial ussystems; torealize incurcost variousreduction expenses,synergies; regardlessand, as necessary, retain key personnel of whetheracquired the acquisition or investment is ultimately completed.companies. In addition, acquisitions and investments may not perform as expected or cause us to assume unrecognized or underestimated liabilities. Further, even if we are able to successfully identify and acquire additional businesses, we may not be able to successfully integrate the acquired personnel or operations, effectively manage the combined business following the acquisition, or the acquired business may have inadequate or ineffective controls and procedures, any of which could harm our business and financial condition. Our management team has limited experience in addressing the challenges of integrating management teams, strategies, cultures and organizations of two companies. These activities are complex, costly and time-consuming and pose a number of risks. Any delays or issues encountered in these activities could have an adverse effect on the financial condition of the company.

We may in the future divest certain product lines that no longer fit our long-term strategies. As previously disclosed, we areentered reviewinginto strategica alternativesdefinitive with respectagreement to sell our Dockers® brand,business. whichOn mayJuly result31, 2025, we sold the Dockers® intellectual property and operations in athe divestitureU.S. and Canada. The sale of the brand.Dockers® DivestituresAndes, Malaysia and Turkey operations is expected to close on or around January 30, 2026 with the sale of the Europe and Mexico operations expected to close on or around February 27, 2026. Divestitures, including of the Dockers® business, may adversely impact our business, operating results and financial condition if we are unable to achieve the anticipated benefits or cost savings from such divestitures, or if we are unable to offset impacts from the loss of revenue associated with the divested product lines. For example, if we decide to sell or otherwise dispose of certain product lines, we may be unable to do so on satisfactory terms within our anticipated timeframe or at all. Further, whether such divestitures are ultimately consummated or not, their pendency could have a number of negative effects on our current business, including increased costs and expenses and potentially disrupting our regular operations, increasing our near-term costs, diverting the attention of our workforce and management team and increasing undesired workforce turnover. It could also disrupt existing business relationships, make it harder to develop new business relationships, or otherwise negatively impact the way that we operate our business.

We face risks arising from the ongoing restructuring of our operations and uncertainty with respect to our ability to achieve any anticipated cost savings associated with such restructuring.

In the first quarter of fiscal year 2024, we began implementing a multi-year global productivity initiative and restructuring planplan, “Project Fuel,” designed to accelerate the execution of our Brand Led and DTC First strategies while fueling long-term profitable growth, with a focus on optimizing our operating model and structure, how we go to market, redesigning business processes and identifying opportunities to reduce costs and simplify processes across our organization. FutureThis chargesrestructuring relatedplan is substantially complete as of November 30, 2025, although certain aspects, including the transition of operations of certain of our global distribution and fulfillment centers to suchthird-party actionslogistics mayproviders, harmremain our profitability in the periods incurred.ongoing.

We are an iconic American company with a rich history of profitable growth, quality, innovation and corporate citizenship. Our story began in San Francisco, California, in 1853 as a wholesale dry goods business. We created the first riveted blue jean 20 years later. Today we design, market and sell products that include jeans, casual and dress pants, activewear, tops, shorts, skirts, dresses, jackets and related accessories for men, women and children around the world under our Levi’s®, Dockers®, Levi Strauss Signature™ and, Denizen® and Beyond Yoga® brands. We service our consumers through our global infrastructure which develops, sources and markets our products around the world. In the first quarter of 2024 we announced the strategic decision to discontinue the Denizen® brand. The wind down of Denizen® brand operations was substantially complete as of March 2, 2025. In the fourthsecond quarter of 2024,2025 we announcedentered weinto area undertakingdefinitive an evaluation of strategic alternativesagreement to thesell globalour Dockers® business,business. includingOn aJuly 31, 2025 the Company sold the Dockers® intellectual property and operations in the U.S. and Canada. The sale of the remaining Dockers® operations is expected to close in the first quarter of 2026 and be completed on or otheraround strategicFebruary transactions.27, 2026.

We operate our business according to three reportable segments: Americas, Europe, and Asia, collectively comprising our Levi's Brands business, which includes the Levi's®, Levi Strauss Signature™ and Denizen® brands. The Dockers® and Beyond Yoga® businessesbusiness, dowhich is managed separately, does not meet the quantitative thresholds for reportable segments andbut therefore areis presented inseparately to increase transparency of our financial statements under the caption of Other Brands.performance.

Our iconic, enduring brands are brought to life every day around the world by our talented and creative employees and partners. The Levi’s® brand epitomizes classic, authentic American style and effortless cool. We have cultivated Levi’s® as a lifestyle brand that is inclusive and democratic in the eyes of consumers while offering products that feel exclusive, personalized and original. This approach has enabled the Levi’s® brand to evolve with the times and continually reach a new, younger audience, while our rich heritage continues to drive relevance and appeal across demographics. The Dockers® brand helped drive “Casual Friday” in the 1990s and has been a cornerstone of casual menswear for more than 30 years. The Levi Strauss Signature™ and Denizen® brands, which we developed for value-conscious consumers, offer quality craftsmanship and great fit and style at affordable prices. The Beyond Yoga® brand is a body positive, premium athleisure apparel brand focused on quality, fit and comfort.

We recognize wholesale revenue from sales of our products through third-party retailers such as department stores, specialty retailers, third-party e-commerce sites and franchise locations dedicated to our brands. We also sell our products directly to consumers (“DTC”) through a variety of formats, including our own company-operated mainline and outlet stores, company-operated e-commerce sites and select shop-in-shops that we operate within department stores and other third-party retail locations. As of DecemberNovember 1,30, 2024,2025, our products were sold in approximately 50,000 retail locations in approximately 120 countries, including approximately 3,4003,300 brand-dedicated stores and shop-in-shops. As of DecemberNovember 1,30, 2024,2025, we had 1,231 company-operated stores located in 3938 countries and approximately 600500 company-operated shop-in-shops. The remainder of our brand-dedicated stores and shop-in-shops were operated by franchisees and other partners.

Across all of our brands, pants – including jeans, casual pants, dress pants, shorts, skirts,skirts and activewear – represented 67% and 68%66% of our total units sold in fiscal years 20242025 and 2023,2024, respectively. Tops – including shirts, sweaters, jackets, dresses and jumpsuits – represented 27%29% and 26%28% of our total units sold in fiscal years 20242025 and 2023,2024, respectively. The remainder of our products are footwear and accessories. Men's products generated 63%60% and 64%62% of our net revenues in fiscal years 20242025 and 2023,2024, respectively. Women'sWomen’s products generated 36%39% and 34%37% of our net revenues in fiscal years 20242025 and 2023,2024, respectively. The remainder of our products are non-gendered. Products other than denim bottoms – which include tops, footwear and accessories and pants excluding jeans – represented 39%36% and 35% of our net revenues in both fiscal years 20242025 and 2023.2024, respectively.

Our Europe and Asia businesses, collectively, contributed 45% of our net revenues and 42% of our segment operating income in fiscal year 2025, as compared to 45% of our net revenues and 40% of our segment operating income in fiscal year 2024, as compared to 43% of our net revenues and 46% of our segment operating income in fiscal year 2023.2024. Revenues from our international business, which includes our Europe and Asia segments, as well as Canada and Latin America from our Americas segment, represented 57% and 56% of our net revenues in fiscal year 20242025 and fiscal year 2023,2024, respectively. Sales of Levi’s® brand products represented approximately 89% and 87%94% of our net revenues in both fiscal year 20242025 and 2023, respectively.2024.

•Inflation and other macroeconomicMacroeconomic pressures in the U.S. and the global economy such as risingchanges interestin rates,tariff energyregimes, prices, potential new tariffsinflation and recession fears are creating a complex and challenging retail environment for us and our customers as consumers may reduce discretionary spending. A decline in consumer spending has had and may continue to have an adverse effect on our revenues, operating margins and net income. These trends historically have impacted and may impact our future financial results, affecting revenue, operating margins and net income.

•TheAs we continue to execute on our strategic framework to be DTC First, we expect to see greater impact on our margins, as the diversification of our business model across channels, geographies, channels, brands, and categories affects our gross margin. For example, if our sales in higher gross margin channels, geographies, channels, brands and categories grow at a faster rate than in our lower gross margin businesschannels, geographies, channels, brands and categories, we would expect a favorable impact to aggregate gross margin over time. Gross margin in our Europe segment is generally higher than in our Americas and Asia segments. DTC sales generally have higher gross margins than sales through third parties, although DTC sales also typically have higher selling expenses and could have lower profitability. AsGross we continue to executemargin on ourtops strategicis frameworkgenerally tolower be DTC first, we expect to see greater impact onthan our margins.bottoms category. Enhancements to our existing product offerings, or our expansion into new brands and products categories, may also impact our future gross margin.

•The current domestic and international political environment, including volatile trade relations and military and civil conflicts, have resulted in uncertainty surrounding the future state of the global economy. There is greater uncertainty with respect to potential changes in trade regulations, tariffs, sanctions and export controls which also increase volatility in the global economy. This environment has affected and may continue to affect production and distribution lead times, increasing our costs and potentially affecting our ability to meet customer demand. If these disruptions persist, they may require us to modify our current sourcing and logistics practices, which may impact our product costs, and, if not mitigated, could have a material adverse effect on our business and results of operations.

•Tax legislation continues to evolve globally with new laws and regulations that create uncertainty and may adversely affect our financial results. The Organization for Economic Cooperation and Development reached agreement among over 140 countries to implement a minimum 15% tax rate on certain multinational enterprises, commonly referred to as Pillar Two. Many countries continue to announce changes in their tax laws and regulations based on the Pillar Two framework. WhileAdditionally, U.S Congress enacted the One Big Beautiful Bill Act (“OBBBA”) which includes significant provisions, including extension of the Tax Cuts and Jobs Act and modifications to the international tax framework. Although we continue to evaluateexpect the impact of these legislative changes as additional guidance becomes available, uncertainty remains regarding the timing and interpretation by tax authorities in affected jurisdictions. These legislative changes are not expectedOBBBA to have aimmaterial materialimpacts impact in fiscal year 2025 but could have an adverse impact onto our effectivefinancial taxresults, rate,we taxwill liabilities,continue andmonitoring cashits tax in future years.impacts.

•Net revenues. Compared to the fourth quarter of fiscal year 2023,2024, consolidated net revenues increased 12.0%0.9% on a reported basis and 7.9%5.0% on an organic net revenues basis. Excluding the effects of currency, revenue growth wasbasis, driven by growth in DTC, which grew across our regions,regions. Wholesale revenues decreased on a reported basis and wholesale,were flat on an organic basis primarily due to declines in the Americas. Organic net revenues excludes the impact on net revenues of the footwear and Denizen® wind downs as well as the 53rd week in fiscal year 2024, which grewbenefited net revenues by approximately $78 million or 4.5% in Americasthe andfourth Asia.quarter.

•Net income.income from continuing operations. Compared to the fourth quarter of 2023,2024, consolidated net income of $182.6$160.2 million increaseddecreased 11% from $126.8$180.3 million. The increasedecrease was primarily due to higher revenueincome tax expense and lower gross profit,margin, partially offset by higher SG&Arevenues expenses.and lower restructuring charges.

•Adjusted EBIT. Compared to the fourth quarter of 2023,2024, Adjusted EBIT of $246.8$213.4 million increaseddecreased from $200.1$243.1 million. The increase wasmillion due to higher revenueAdjusted SG&A and lower gross profit described above,margins, partially offset by higher revenues. As a result, Adjusted SG&A.EBIT margin was 12.1%, 180 basis points lower than the fourth quarter of 2024 on a reported basis, and 200 basis points lower on a constant-currency basis.

•Adjusted net income. Compared to the fourth quarter of 2023,2024, Adjusted net income of $202.2$162.9 million increaseddecreased from $178.6$199.9 million. The increase wasmillion, primarily due to the higherlower Adjusted EBIT described above.above and higher income taxes in the current year.

•Diluted earnings per share.share Comparedfrom tocontinuing fiscaloperations. yearWe 2023,recognized diluted earnings per share from continuing operations of $0.52$0.40, decreasedcompared fromto $0.62$0.45 in the fourth quarter of 2024, mainly due to the lowerdecrease netin Net income from continuing operations described above.

•Adjusted diluted earnings per share. Compared to fiscalthe yearfourth 2023,quarter of 2024, Adjusted diluted earnings per share of $1.25$0.41 increaseddecreased from $1.10$0.49 mainly due to the lowerdecrease in Adjusted net income described above. Currency translation unfavorablyfavorably affected Adjusted diluted earnings per share by $0.02.$0.01

For more information on Organic net revenues, Adjusted SG&A, Adjusted EBIT, Adjusted net income and Adjusted diluted earnings per share, measures not prepared in accordance with United States generally accepted accounting principles,GAAP, and reconciliations of such measures to net income from continuing operations and diluted earnings per share,share from continuing operations, see “Non-GAAP Financial Measures.”

Fiscal year. We use a 52- or 53-week fiscal year, with each fiscal year ending on the Sunday that is closest to November 30 of that year. Certain of our foreign subsidiaries have fiscal years ending November 30. Each fiscal year generally consists of four 13-week quarters, with each quarter ending on the Sunday that is closest to the last day of the last month of that quarter. Fiscal year 2025 was a 52-week year, ending on November 30, 2025, and 2024 was a 53-week year,year ending on December 1, 2024, and 2023 was a 52-week year ending November 26, 2023.2024. Each quarter of fiscal years 20242025 and 20232024 consisted of 13 weeks with the exception of the fourth quarter of 2024 which consisted of 14 weeks.

Segments. Our Levi'sLevi’s Brands business, which includes Levi'sLevi’s®, Levi Strauss Signature™ and Denizen® brands, is defined by geographical regions into three segments: Americas, Europe and Asia. Our Dockers® and Beyond Yoga® businessesbusiness, arewhich is managed separatelyseparately, and dodoes not meet the quantitative thresholds of afor reportable operatingsegments segmentbut andis arepresented reported in our financial statements under the caption of “Other Brands”. Effective in the second quarter of 2024, Dockers® and Beyond Yoga® businesses are disclosed as separate lines under the caption “Other Brands”separately to increase transparency of our performance. PriorIn periodsthe werefirst adjustedquarter of 2024, we announced the strategic decision to reflectdiscontinue the change.Denizen® brand. The wind down of the Denizen® brand operations was substantially complete as of March 2, 2025.

•Selling expenses reflected in SG&A expenses include, among other things, all occupancy costs and depreciation associated with our company-operated stores and commissions associated with our company-operated shop-in-shops, as well as costs associated with our e-commerce operations.

•We reflect substantially all distribution costs in SG&A expenses,A, for both our DTC and wholesale channels, including costs related to receiving and inspection at distribution centers, warehousing, shipping to our customers, handling, and certain other activities associated with our distribution network.

A discussion regarding our results of operations for fiscal year 2025 compared to fiscal year 2024 is presented below. A discussion regarding our results of operations for fiscal year 2024 compared to fiscal year 2023 is presented below. A discussion regarding our results of operations for fiscal year 2023 compared to fiscal year 2022 can be found under Item 7 – Management’s Discussion and Analysis in our Annual Report on Form 10-K for the year ended NovemberDecember 26,1, 2023,2024, filed with the SEC on January 25,29, 2024.2025.

We recognize wholesale revenue from sales of our products through third-party retailers such as department stores, specialty retailers, third-party e-commerce sites and franchise locations dedicated to our brands. We also sell our products directly to consumers (“DTC”) through a variety of formats, including our own company-operated mainline and outlet stores, company-operated e-commerce sites and select shop-in-shops that we operate within department stores and other third-party retail locations. As of MayAugust 31,30, 2026, our products were sold in approximately 50,000 retail locations in approximately 120 countries, including approximately 3,300 brand-dedicated stores and shop-in-shops. As of MayAugust 31,30, 2026, we had 1,2421,261 company-operated stores located in 38 countries and approximately 520525 company-operated shop-in-shops. The remainder of our brand-dedicated stores and shop-in-shops were operated by franchisees and other partners.

Across all of our brands, pants – including jeans, casual pants, dress pants, shorts, skirts and activewear – represented 67%66% and 68%67% of our total units sold in the first sixnine months of 2026 and 2025, respectively. Tops – including shirts, sweaters, jackets, dresses and jumpsuits – represented 30% and 29% of our total units sold in the first sixnine months of both 2026 and 2025.2025, respectively. The remainder of our products are accessories. Men’s products generated 58% and 60% of our net revenues in the first sixnine months of 2026 and 2025, respectively. Women’s products generated 41%40% and 39% of our net revenues in the first sixnine months of 2026 and 2025, respectively. The remainder of our products are non-gendered. Products other than denim bottoms – which include tops, accessories and pants excluding jeans – represented 38% of our net revenues in the first sixnine months of both 2026 and 2025.

Our Europe and Asia businesses, collectively, contributed 47% and 46% of our net revenues in the first sixnine months of both 2026 and 2025, respectively.2025. Net revenues from our international business, which includes our Europe and Asia segments, as well as Canada and Latin America from our Americas segment, represented 60% and 57%58% of our net revenues in the first sixnine months of 2026 and 2025, respectively. Sales of Levi’s® brand products represented approximately 94% of our net revenues in the first sixnine months of both 2026 and 2025.

Our wholesale channel generated 48% and 49%51% of our net revenues in the first sixnine months of both 2026 and 2025, respectively.2025. Sales to franchise partners, included as a component of our wholesale channel, generated 6% of our net revenues in the first six months of both 2026 and 2025. Our DTC channel generated 52% and 51%7% of our net revenues in the first sixnine months of 2026 and 2025, respectively,respectively. Our DTC channel generated 49% of our net revenues in the first nine months of both 2026 and 2025, with our company operated e-commerce business representing 24%23% and 23%22% of DTC channel net revenues in the first sixnine months of 2026 and 2025, respectively, and 12%11% of total net revenues in the first sixnine months of both 2026 and 2025.

•Reciprocal tariffs previously imposed on products imported into the U.S. from most jurisdictions, along with retaliatory actions by other countries, have created an uncertain environment for global trade. On February 20, 2026 a U.S. Supreme Court ruling invalidated the tariffs imposed by the U.S. government under the International Emergency Economic Powers Act (“IEEPA”) on products imported into the U.S.,U.S. During the third quarter of 2026 the Company recorded $78.6 million of refunds of previously paid IEEPA tariffs as a reduction of cost of goods sold, $57.1 million of which introducedwere received by August 30, 2026. The Company continues to assess loss recovery on tariff refunds under future phases. During the potential for such previously collected tariffs to be refunded by the U.S. government. Through the firstthird quarter of 2026, the Company paidalso approximatelyrecorded $80$4.7 million of theseinterest tariffs.income associated with the IEEPA refunds which was included in “Other income (expense), net” in the consolidated statements of income. Following the U.S. Supreme Court ruling, the U.S. government imposedannounced on July 23, 2026, new tariffs under aSection separate301 authorityof prospectively.the Trade Act of 1974 on most imports from certain countries, effective upon the expiration of the previous temporary Section 122 tariffs. Uncertainty continues to exist regarding current and future tariffs. Many of our products are produced in countries, such as Bangladesh, Cambodia, Pakistan, and Vietnam, that were subject to the recently invalidated U.S. IEEPA tariffs, and are subject to the currentnew prospective tariffs. There may be additional tariff actions or increases to existing tariffs in the future. As a result of these tariff actions, retaliatory actions taken by other countries in response, and ongoing uncertainty regarding U.S. trade policy, the cost of our inventory in the U.S. has generally increased and may increase further in the future. These increased costs could lead to a significant increase in cost of sales and a significant reduction in gross margin and income from operations. We are monitoring the changing tariffs and trade restrictions, assessing the impact on our business and taking steps to mitigate their impact. However, the duration, magnitude and scope of any additional tariffs, trade restrictions, and retaliatory or other measures are difficult to predict, including related unfavorable impacts to consumer demand, along with the extent (if any) to which we will be able to offset the impacts of such actions through our mitigation efforts. These tariff actions, retaliatory measures, or other trade restrictions could materially and adversely affect our business.

•As part of our effort to optimize our logistics network, we are in the process of transitioning and stabilizing the operation of certain of our global distribution and fulfillment centers to third-party logistics providers. This transition from owner-operated facilities to third-party logistics providers has and may continue to cause interruptionsdisruptions and service level impacts to these centers as we transition or restructure systems, technology and employees. We have and may continue to experience shipping delays, order cancellations and increased costs as a result of this transition and stabilization.stabilization which has and may continue to impact our relationships with wholesale customers. Additionally, during the quarter there was a fire at one of our distribution centers, which had an impact on our operations. The damage to our inventory is insured and the impact on our financial results was not significant. We are subject to concentration risks and any disruptions, delays or other events impacting the business of the third-party logistics providers may have a significant impact on our business, including our ability to timely fulfill orders. If we continue to encounter problems with our distribution system, our ability to meet customer and consumer expectations, manage inventory, complete sales and achieve operating efficiencies may be adversely affected.

•Macroeconomic pressures in the U.S. and the global economy such as changes in tariff regimes, inflation, interest rates, energy prices and recession fears are creating a complex and challenging retail environment for us and our customerscustomers. asThese pressures are weighing on consumer sentiment and may cause consumers mayto reduce or reallocate discretionary spending. These trends historically have impacted and may impact our future financial results, affecting demand for our products, revenue, margins and net income.

•Tax legislation continues to evolve globally with new laws and regulations that create uncertainty, including an agreement reached by the Organization for Economic Cooperation and Development among over 140 countries to implement a minimum 15% tax rate on certain multinational enterprises, commonly referred to as Pillar Two, and the One Big Beautiful Bill Act (“OBBBA”) enacted by U.S. Congress. Pillar Two could adversely impact our effective tax rates, tax liability and cash taxes in 2026 and future years. We do not expect Pillar Two or the OBBBA to have a material impact to our financial results and we will continue to monitor their impacts as the legislative landscape evolves.results.

•There has been increased focus from our stakeholders, including consumers, employees, investors, regulatory organizations and legislatures on corporate environmental, social, and governance (“ESG”) practices, including corporate practices related to the causes and impacts of climate change and corporate statements, practices or products related to a variety of social issues. We expect that stakeholder expectations and actions with respect to ESGthese practices and social issues and regulatory requirements will continue to evolve rapidly, which may impact our reputation and financial results.

We typically achieve our largest quarterly revenues in the fourth quarter. In fiscal year 2025, our net revenues in the first, second, third and fourth quarters represented 24%, 23%, 25%, and 28%, respectively, of our total net revenues for the year.

Our SecondThird Quarter 2026 Results

•Net revenues. Consolidated net revenues increased 8.0%4.3% on a reported basis and 5.7%4.5% on an organic net revenues basis compared to the secondthird quarter of 2025 reflecting net revenue growth driven by Americasour wholesale channel and Asiaour andDTC channel in both DTC and wholesale channels.Asia.

•Net income from continuing operations. Compared to the secondthird quarter of 2025, consolidated net income from continuing operations increased to $94.8$168.6 million from $79.6$122.0 million. The increase was primarily driven by higher gross profit, which included a benefit of $78.6 million related to IEEPA tariff refunds. This was partially offset by higher selling, general and administrative expenses (“SG&A”). Net income margin from continuing operations was 6.1%,10.5%, up from 5.5%7.9% in the secondthird quarter of 2025. Operating margin was 7.8%,13.8%, up from 7.5%10.8% in the secondthird quarter of 2025. Net tariff refunds contributed 490 basis points of operating margin expansion.

•Adjusted EBIT. Compared to the secondthird quarter of 2025, Adjusted EBIT increased 18.4%36.4% to $141.2$248.7 million from $119.3$182.3 million primarily driven by higher gross profit, partially offset by higher SG&A. Adjusted EBIT margin was 9.0%,15.5%, 70370 basis points higher than the secondthird quarter of 2025 on a reported basis, and 50380 basis points higher on a constant-currency basis. Net tariff refunds contributed 490 basis points of Adjusted EBIT margin expansion.

•Adjusted net income. Compared to the secondthird quarter of 2025, Adjusted net income increased to $109.8$188.9 million from $88.5$135.7 million due to higher Adjusted EBIT described above.

•Diluted earnings per share from continuing operations. Compared to the secondthird quarter of 2025, diluted earnings per share from continuing operations increased to $0.24$0.43 from $0.20,$0.31, mainly due to the higher Net income from continuing operations described above.

•Adjusted diluted earnings per share. Compared to the secondthird quarter of 2025, Adjusted diluted earnings per share increased to $0.28$0.48 from $0.22,$0.34, mainly due to the higher Adjusted net income described above. Currency translation favorablyunfavorably affected Adjusted diluted earnings per share by $0.01.

•Net revenues. Consolidated net revenues increased 11.2%8.8% on a reported basis and 7.5%6.5% on an organic net revenues basis compared to the first sixnine months of 2025. Net revenues grew across all regions and in both our DTC and wholesale channels.

•Net income from continuing operations. Compared to the first sixnine months of 2025, consolidated net income from continuing operations increased to $271.9$440.5 million from $219.8$341.8 million, primarily due to higher gross profitprofit, which included a benefit of $80.7 million related to IEEPA tariff refunds, and a legal settlement gain, partially offset by higher SG&A and higher income taxes. Operating margin was 9.7%11.1% compared to 10.1%10.3% in the first sixnine months of 2025. Net tariff refunds contributed 170 basis points of operating margin expansion.

•Adjusted EBIT. Compared to the first sixnine months of 2025, Adjusted EBIT increased 11.0%20.2% to $359.0$607.7 million from $323.3$505.6 million, primarily due to higher gross profit, partially offset by higher SG&A. Adjusted EBIT margin was 10.9%,12.4%, unchangedup from 11.2% from the first sixnine months of 2025 on a reported basis and 40100 basis points lowerhigher on a constant-currency basis. Net tariff refunds contributed 170 basis points of Adjusted EBIT margin expansion.

•Adjusted net income. Compared to the first sixnine months of 2025, Adjusted net income increased 15.9%24.4% to $276.5$465.4 million from $238.5$374.2 million, primarily due to higher Adjusted EBIT described above, partially offset by higher income taxes in the current year.

•Diluted earnings per share from continuing operations. Compared to the first sixnine months of 2025, diluted earnings per share increased to $0.69$1.12 from $0.55,$0.86, mainly due to higher net income from continuing operations described above.

•Adjusted diluted earnings per share. Compared to the first sixnine months of 2025, Adjusted diluted earnings per share increased to $0.70$1.19 from $0.60,$0.94, due to higher Adjusted net income described above. Currency translation favorably affected Adjusted diluted earnings per share by $0.02.$0.01.

Total net revenues increased on both a reported and organic net revenues basis for the three-month and six-monthnine-month periods ended MayAugust 31,30, 2026, as compared to the same periods in 2025. Currency translation had aan favorableunfavorable impact on total net revenues of approximately $32$3 million and a favorable impact of approximately $102$100 million for the three-month and six-monthnine-month periods ended MayAugust 31,30, 2026, respectively.

Americas. Currency translation had a favorable impact on net revenues of approximately $16$12 million and approximately $34$46 million for the three-month and six-monthnine-month periods ended MayAugust 31,30, 2026, respectively. Net revenues in the Americas increased for the three-month and six-monthnine-month periods ended MayAugust 31,30, 2026 on both a reported and organic net revenues basis compared to the prior-year period driven by growth in both DTC and wholesale channels.periods.

TheFor increasethe inthree-month period ended August 30, 2026, DTC revenues wasincreased primarilyslightly due to store performanceexpansion and expansiongrowth in e-commerce which were largely offset by slower traffic in our company-operated stores,stores. Wholesale revenues increased due to price increases partially offset by a slight decrease in volume. For the nine-month period ended August 30, 2026, DTC revenues increased from store expansion and higherperformance and growth in e-commerce revenues.due to higher demand. We benefited from 1742 more company-operated stores in operation in AsiaAmericas as of MayAugust 31,30, 2026 as compared to JuneAugust 1,31, 2025. The increase in wholesaleWholesale revenues wasincreased primarily duefrom tohigher anvolumes increaseand inprice units sold.increases.

Beyond Yoga®. Net revenues in Beyond Yoga® increased on a reported and organic net revenues basis for the three-month and six-month periodsperiod ended MayAugust 31,30, 2026 compareddue primarily to store expansion and for the priornine-month yearperiod periods,ended August 30, 2026 primarily due to growth in e-commerce net revenuesrevenues, reflecting higher demand.demand, and store expansion. Beyond Yoga benefited from six more company-operated stores in operation as of August 30, 2026 as compared to August 31, 2025. Currency translation did not have an impact on net revenues.

Wholesale. Currency translation had aan favorableunfavorable impact on net revenues of approximately $16$2 million and a favorable impact of approximately $45$43 million for the three-month and six-monthnine-month periods ended MayAugust 31,30, 2026, respectively. Net revenues in our wholesale channel increased for the three-month and six-month periodsperiod ended MayAugust 31,30, 2026 compared with the prior-year periodsperiod on a reported and organic net revenues basis primarily due to higherprice volumes,increases withand higher sales of Levi’s® women’s products,volumes and benefitedincreased from price increases. Forfor the three-monthnine-month period ended MayAugust 31,30, 2026,2026 lower volumes in Europe wereprimarily due primarily to normalizationhigher of shipping in the prior year period after the transition to the distribution center in Dorsten, Germany.volumes.

DTC (Direct to Consumer). Currency translation did not have a significant impact and had a favorable impact on net revenues of approximately $16 million and approximately $57 million for the three-month and six-monthnine-month periods ended MayAugust 31,30, 2026, respectively. Net revenues in our DTC channel increased on both a reported and organic net revenues basis for the three-month and six-monthnine-month periods ended MayAugust 31,30, 2026. TheFor increasethe wasthree-month period ended August 30, 2026 DTC revenue increased primarily due to higher e-commerce revenues and store expansion, partially offset by lower store performance driven by storesofter performancetraffic. andFor expansion,the andnine-month period ended August 30, 2026 DTC revenue increased primarily due to higher e-commerce revenues.revenues, DTCstore revenuesexpansion alsoand benefitedstore from price increases.performance. For the three-month and six-monthnine-month periods ended MayAugust 31,30, 2026 net revenues from e-commerce on a reported basis grew 19%10% and 20%,17%, respectively. As a percentage of net revenues on a reported basis for the three-month and six-monthnine-month periods ended MayAugust 31,30, 2026 DTC comprised 51%45% and 52%49% of total net revenues, respectively.

Levi’s®. Currency translation had aan favorableunfavorable impact on net revenues of approximately $31$3 million and a favorable impact of approximately $102$99 million for the three-month and six-monthnine-month periods ended MayAugust 31,30, 2026, respectively. Net revenues for the Levi’s® brand increased on both a reported and organic net revenues basis for the three-month and six-monthnine-month periods ended MayAugust 31,30, 2026. TheFor increasethe wasthree-month aperiod resultended ofAugust 30, 2026 Levi’s Brands revenues increased due to higher revenues in our wholesale channel, primarily due to price increases, and higher revenues in our DTC channel, primarily due to higher e-commerce revenues and store expansion. For the nine-month period ended August 30, 2026 Levi’s Brands revenues increased due to higher revenue in our DTC channel, primarily due to increases in store performance and expansion, and higher e-commerce revenues, store expansion, and anstore increaseperformance, and higher revenues in our wholesale revenueschannel primarily due primarily to higher volumes,volumes with higher sales of Levi’s® women’s products. Net revenues for the Levi’s® brand also benefited fromand price increases.

Levi Strauss Signature™. Currency translation did not have a significant impact on net revenues for the three-month and six-monthnine-month periods ended MayAugust 31,30, 2026. Net revenues for the Levi Strauss Signature™ brand increased on both a reported and organic net revenues basis for the three and six months ended May 31, 2026 due primarily to price increases for the three-month period ended August 30, 2026 and due to price increases and more units sold.sold for the nine-month period ended August 30, 2026.

Currency translation had aan favorableunfavorable impact on gross profit of approximately $19$2 million and a favorable impact of approximately $66$64 million for the three-month and six-monthnine-month periods ended MayAugust 31,30, 2026, respectively. For the three-month and six-month periodsperiod ended MayAugust 31,30, 2026, the changeincrease in gross margin reflectsincludes the IEEPA tariff refund benefit of $78.6 million, which drove 490 basis points of gross margin expansion, as well as the favorable impactsimpact of pricing actions and lower product costscosts. andThis thewas unfavorablepartially impactoffset of tariffs. Additionally, gross margin decreasedby approximately 3070 basis points andof increased approximately 10 basis points as a result ofunfavorable currency exchange,exchange fluctuations, including transaction impacts, for the three-month and six-month periods ended May 31, 2026, respectively.impacts.

Currency translation did not have a significant impact and had an unfavorable impact on SG&A of approximately $14 million and approximately $43 million for the three-month and six-monthnine-month periods ended MayAugust 31,30, 2026, respectively.

Selling. Currency translation did not have a significant impact and had an unfavorable impact on selling expenses of approximately $7 million and approximately $25 million for the three-month and six-monthnine-month periods ended MayAugust 31,30, 2026, respectively. Excluding the effects of currency, selling expenses increased for the three-month and six-monthnine-month periods ended MayAugust 31,30, 2026 primarily due to higher DTC store expenses in the current year as compared to the prior-year periods, including from store expansion. For the three-month period ended August 30, 2026 selling expenses as a percent of revenue increased compared to the prior-year period in part due to lower revenues in our company-operated stores due to slower traffic.

Advertising and promotion. Currency translation did not have a significant impact and had an unfavorable impact on advertising and promotion expenses of approximately $2 million and approximately $5 million for the three-month and six-monthnine-month periods ended MayAugust 31,30, 2026, respectively. Excluding the effects of currency, the decreaseincreases in advertising and promotion expenses for the three-month periodand nine-month periods ended MayAugust 31,30, 2026 waswere primarily due to normalizationincreased ofmedia current year expense during the quarter.spending. Advertising and promotion expenses were higher for the six-monthnine-month period ended MayAugust 31,30, 2026 primarily due toincluded increased spending related to the launch of the Behind Every Original campaign, including a commercial during Super Bowl LX which was held at Levi’s® Stadium.

Distribution. Currency translation did not have a significant impact and had an unfavorable impact on distribution expenses of approximately $2 million and approximately $7 million for the three-month and six-monthnine-month periods ended MayAugust 31,30, 2026, respectively. Excluding the effects of currency, the increase in distribution expenses was primarily due to increased volume,volume and higher rates, partially offset during the nine-month period ended August 30, 2026 by the impact of owned and operated distribution center closures in the prior year.

Other. Other expenses include functional administrative and organization costs, information resources, and marketing organization costs. Currency translation did not have a significant impact and had an unfavorable impact on other expenses of approximately $6 million for the three-month and six-monthnine-month periods ended MayAugust 31,30, 2026, respectively. The increase in other SG&A for the three-month and six-month periodsperiod ended MayAugust 31,30, 2026 included higher restructuring-related consulting fees and higher technology costs. The increase in other SG&A for the six-monthnine-month period ended MayAugust 31,30, 2026 also includesincluded the impact of higher technology costs, higher restructuring-related consulting fees and attorney fees of $10.0 million related to a gain on legal settlement, partially offset by a decrease in incentive compensation.

During the three-month and six-monthnine-month periods ended MayAugust 31,30, 2026 we recognized restructuring charges of $13.5$7.6 million and $21.4$29.0 million, respectively, consisting primarily of severance and other post-employment benefit charges, contract terminations, and asset impairments related to certain discontinued technology projects.projects and contract terminations. During the three-month and six-monthnine-month periods ended JuneAugust 1,31, 2025 we recognized restructuring charges of $6.8$8.6 million and $13.5$22.1 million, respectively, in connection with Project Fuel, a multi-year global productivity initiative that was substantially complete as of November 30, 2025, consisting primarily of severance and other post-employment benefit charges andcharges, asset impairments and contract terminations in connection with closures of distribution centers which were largely offset by a gain on sale of a previously closed distribution center.

Currency translation did not have a significant impact and had a favorable impact on total operating income of approximately $5 million and approximately $23$21 million for the three-month and six-monthnine-month periods ended MayAugust 31,30, 2026, respectively.

•Europe.Americas. Currency translation had a favorable impact on operating income in the segment of approximately $5$3 million and approximately $21$7 million for the three-month and six-monthnine-month periods ended MayAugust 31,30, 2026, respectively. Excluding the effects of currency, the increase in operating income for the three-month period ended MayAugust 31,30, 2026 compared with the prior-year period was due primarily to higher gross marginsmargins, partiallywhich offsetincluded byIEEPA lowertariff revenue.refunds, For the six-month period ended May 31, 2026 operating income increased due toand higher revenuesrevenues, andwhich gross margins,were partially offset by higher SG&A, which increased as a percent of revenue.revenues. The increase in operating income for the nine-month period ended August 30, 2026 was due primarily to higher revenues and higher gross margins, which included IEEPA tariff refunds, partially offset by higher SG&A, which increased as a percent of revenues.

•Asia.Europe. Currency translation did not have a significant impact and had a favorable impact on operating income in the segment of approximately $20 million for the three-month and six-monthnine-month periods ended MayAugust 31,30, 2026.2026, respectively. Excluding the effects of currency, the increases in operating income increased for the three-month and six-monthnine-month periods ended MayAugust 31,30, 2026 compared with the prior-year periods were due primarily to increases inhigher revenues and higher gross margins,margins partially offset by higher SG&A.A, which increased as a percent of revenues.

Beyond Yoga® operating loss. Currency translation did not have a significant impact on operating income in the segment for the three-month and six-monthnine-month periods ended MayAugust 31,30, 2026. The increase in operating losses for the three-month period ended August 30, 2026 was due to higher SG&A, partially offset by higher revenues. The decrease in operating losses for the three-monthnine-month and six-month periodsperiod ended MayAugust 31,30, 2026 as compared to the prior year periodsperiod was due to higher revenues and gross margins, partially offset by higher SG&A.A, which decreased as a percent of revenues. Operating losses during the currentthree-month quarterand nine-month periods ended August 30, 2026 benefited from the$1.6 recognitionmillion and $3.1 million of a IEEPA tariff refundrefunds, claimed to U.S. Customs and Border Protection as part of the first phase to submit and process claims, representing the expense of IEEPA tariffs on inventory previously sold.respectively.

Restructuring charges, net. Restructuring charges, net currency translation did not have a significant impact on operating income for the three-month and six-monthnine-month periods ended MayAugust 31,30, 2026. During the three-month and six-monthnine-month periods ended MayAugust 31,30, 2026 we recognized restructuring charges of $13.5$7.6 million and $21.4$29.0 million, respectively, consisting primarily of severance and other post-employment benefit charges, contract terminations, and asset impairments related to certain discontinued technology projects.projects and contract terminations. During the three-month and six-monthnine-month periods ended JuneAugust 1,31, 2025 we recognized restructuring charges of $6.8$8.6 million and $13.5$22.1 million, respectively, in connection with Project Fuel, a multi-year global productivity initiative that was substantially complete as of November 30, 2025, consisting primarily of severance and other post-employment benefit charges and asset impairments and contract terminations in connection with closures of distribution centers which were largely offset by a gain on sale of a previously closed distribution center.

Corporate expenses. Corporate expenses represent costs that management does not attribute to any of our operating segments. Included in corporate expenses are other corporate staff costs and costs associated with our global inventory sourcing organization, which are reported as a component of consolidated gross margin. Corporate expenses currency translation did not have a significant impact on operating income for the three-month and six-monthnine-month periods ended MayAugust 31,30, 2026.

The increase in corporate expenses for the three-month period ended MayAugust 31,30, 2026 compared to the prior year period included higher globalrestructuring-related sourcingconsulting fees, higher technology costs and higher technologyglobal sourcing costs. The increase in corporate expenses for the six-monthnine-month period ended MayAugust 31,30, 2026 compared to the prior yearprior-year period included higher global sourcing costs, higher technology costscosts, higher restructuring-related consulting fees and the impact of attorney fees related to a gain on legal settlement of $10.0 million, partially offset by a decrease in incentive compensation.

Interest expense was $12.9 million and $26.0$38.9 million for the three-month and six-monthnine-month periods ended MayAugust 31,30, 2026, respectively, as compared to $11.8$12.5 million and $22.7$35.2 million in the prior-year periods. Our weighted-average interest rates on average borrowings outstanding during the three-month and six-monthnine-month periods ended MayAugust 31,30, 2026 were 4.61%4.69% and 4.64%,4.66%, respectively, as compared to 4.28%4.43% and 4.26%4.32% during the comparable periods in 2025.

For the three-month and six-monthnine-month periods ended MayAugust 31,30, 2026, we recorded other income of $12.9$10.7 million and $55.5$66.2 million, respectively, as compared to other income of $6.3$1.3 million and $2.2$3.5 million in the prior-year periods. The increase in otherOther income for the three-month period ended MayAugust 31,30, 2026 was primarily due toincluded the recognition of foreign exchange management gains of $8.6$2.3 million and foreign currency transaction losses of $1.1$0.6 million, compared to foreign exchange management gains of $40.9$11.0 million and foreign currency transaction losses of $39.6$11.1 million in the prior yearprior-year period. The increase in other income for the six-monthnine-month period ended MayAugust 31,30, 2026 was primarily due to the recognition of a legal settlement gain of $33.0 million, foreign exchange management gains of $14.2$16.5 million and foreign currency transaction losses of $6.6$7.2 million, compared to foreign exchange management gains of $30.1$41.0 million and foreign currency transaction losses of $37.4$48.6 million in the prior year period. Interest income received from IEEPA tariff refunds of $4.7 million is included in Other income (expense), net for the three-month and nine-month periods ended August 30, 2026.

Our effective income tax rate was 22.4%23.4% for the three-month period ended MayAugust 31,30, 2026, compared to 22.3%21.9% for the same prior-year period. Our effective income tax rate was 22.4%22.8% for the six-monthnine-month period ended MayAugust 31,30, 2026, compared to 21.2%21.5% for the same prior-year period. The increaseincreases in the effective income tax rate for the six-monththree-month periodand nine-month periods ended MayAugust 31,30, 2026 waswere primarily due to a lower foreign-derived intangible income benefit compared with the prior-year period.periods.

As of MayAugust 31,30, 2026, we did not have any borrowings under the Credit Facility. Unused availability under the facility was $820.9$696.7 million, and our total availability of $839.9$715.8 million (based on collateral levels as defined by the agreement less outstanding borrowings under the Credit Facility) was reduced by $19.0$19.1 million from other credit-related instruments. We also had cash and cash equivalents totaling approximately $849.3$641.4 million and short-term investments of $128.5$137.9 million resulting in a total liquidity position (unused availability and cash and cash equivalents and short-term investments) of approximately $1.8$1.5 billion. Of our $849.3$641.4 million in cash and cash equivalents, approximately $717.1$382.0 million was held by foreign subsidiaries.