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What changed in LEVI STRAUSS & CO's 10-K — 2023 vs 2024

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Paragraph-level year-over-year comparison of LEVI STRAUSS & CO's 2023 and 2024 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2024 report.

+484 added−488 removedSource: 10-K (2025-01-29) vs 10-K (2024-01-25)

Top changes in LEVI STRAUSS & CO's 2024 10-K

484 paragraphs added · 488 removed · 358 edited across 7 sections

Item 1. Business

Business — how the company describes what it does

70 edited+16 added−22 removed50 unchanged
Biggest changeEach quarter of fiscal years 2023, 2022 and 2021 consisted of 13 weeks. The fourth quarter of 2024 will consist of 14 weeks and end on December 1, 2024. The level of our working capital reflects the seasonality of our business and varies throughout the year to support our seasonal and holiday revenue patterns as well as business trends.
Biggest changeThe level of our working capital reflects the seasonality of our business and varies throughout the year to support our seasonal and holiday revenue patterns as well as business trends. Effects of Inflation Inflationary pressures persist, including increased costs of labor and competition for, and price volatility of, resources throughout the supply chain.
Principal competitive factors include: • anticipating and responding to changing consumer preferences and buying trends in a timely manner, and ensuring product availability at wholesale and DTC channels; • developing high-quality, innovative products with relevant designs, fits, finishes, fabrics, style and performance features that meet consumer desires and trends; • maintaining favorable and strong brand name recognition, loyalty and appeal through strong and effective marketing support and consumer intelligence in diverse market segments; • identifying and securing desirable new retail locations and presenting products effectively at company-operated retail and franchised and other brand-dedicated stores; • ensuring high-profile product placement at retailers; • anticipating and responding to consumer expectations regarding e-commerce shopping and shipping; • optimizing supply chain cost efficiencies and product development cycle lead times; • withstanding prolonged periods of adverse economic conditions or business disruptions; • adapting to changes in technology, including the successful utilization of data analytics, artificial intelligence and machine learning; • sourcing sustainable and traceable raw materials at cost-effective prices; • recruiting and retaining employees to operate our retail stores, distribution centers and various corporate functions; • protecting our intellectual property; • providing attractive, reliable, secure and user-friendly digital commerce sites; • creating products at a range of price points that appeal to the consumers of both our wholesale customers and our dedicated retail stores and e-commerce sites situated in each of our geographic regions; and • generating competitive economics for wholesale customers, including retailers, franchisees, and licensees.
Principal competitive factors include: 11 Table of Contents • anticipating and responding to changing consumer preferences and buying trends in a timely manner, and ensuring product availability at wholesale and DTC channels; • developing high-quality, innovative products with relevant designs, fits, finishes, fabrics, style and performance features that meet consumer desires and trends; • maintaining favorable and strong brand name recognition, loyalty and appeal through strong and effective marketing support and consumer intelligence in diverse market segments; • identifying and securing desirable new retail locations and presenting products effectively at company-operated retail and franchised and other brand-dedicated stores; • ensuring high-profile product placement at retailers; • anticipating and responding to consumer expectations regarding e-commerce shopping and shipping; • optimizing supply chain cost efficiencies and product development cycle lead times; • withstanding prolonged periods of adverse economic conditions or business disruptions; • adapting to changes in technology, including the successful utilization of data analytics, artificial intelligence and machine learning; • sourcing sustainable and traceable raw materials at cost-effective prices; • recruiting and retaining employees to operate our retail stores, distribution centers and various corporate functions; • protecting our intellectual property; • providing attractive, reliable, secure and user-friendly digital commerce sites; • creating products at a range of price points that appeal to the consumers of both our wholesale customers and our dedicated retail stores and e-commerce sites situated in each of our geographic regions; and • generating competitive economics for wholesale customers, including retailers, franchisees, and licensees.
We distribute Signature by Levi Strauss & Co.™ and Denizen ® brand products primarily through mass channel retailers in the Americas, including the e-commerce sites operated by some of our key wholesale customers and other pure-play customers. We were founded in San Francisco, California in 1853 and were incorporated in Delaware in 1970.
We distribute Levi Strauss Signature™ and Denizen ® brand products primarily through mass channel retailers in the Americas, including the e-commerce sites operated by some of our key wholesale customers and other pure-play customers. We were founded in San Francisco, California in 1853 and were incorporated in Delaware in 1970.
We use the data to identify potential adjustments to be incorporated into our annual performance review process for different groups in the U.S. population, including corporate and retail employees as well as distribution center management. The study considered job level, performance, experience, and other factors such as promotions and location of jobs.
We use the data to identify potential adjustments to be incorporated into our annual performance review process for different groups in the U.S. population, including corporate and retail employees as well as distribution center management. The analysis considered job level, performance, experience, and other factors such as promotions and location of jobs.
We offer denim jeans, casual pants, tops and jackets in a variety of fits, fabrics and finishes for men, women and children under the Signature by Levi Strauss & Co.™ brand through the mass retail channel primarily in the United States and Canada. The Signature by Levi Strauss & Co.™ was introduced in 2003.
We offer denim jeans, casual pants, tops and jackets in a variety of fits, fabrics and finishes for men, women and children under the Levi Strauss Signature™ brand through the mass retail channel primarily in the United States and Canada. The Levi Strauss Signature™ brand was introduced in 2003.
Signature by Levi Strauss & Co.™ and Denizen ® Brands In addition to our Levi's ® brand, we offer the Signature by Levi Strauss & Co.™ and Denizen ® brands, which are focused on value-conscious consumers who seek quality craftsmanship and great fit and style at affordable prices.
Levi Strauss Signature™ and Denizen ® Brands In addition to our Levi's ® brand, we offer the Levi Strauss Signature™ and Denizen ® brands, which are focused on value-conscious consumers who seek quality craftsmanship and great fit and style at affordable prices.
Due to the timing of our fiscal year end, a particular fiscal year might include one, two or no Black Fridays, which could impact our net revenues for the fiscal year. Fiscal years 2023, 2022 and 2021 each included one Black Friday.
Due to the timing of our fiscal year end, a particular fiscal year might include one, two or no Black Fridays, which could impact our net revenues for the fiscal year. Fiscal years 2024, 2023 and 2022 each included one Black Friday.
We also connect with sport and music fans across the world, including through the naming rights to the stadium for the San Francisco 49ers, which we secured in 2013. We are focused on strengthening our brands globally.
We also connect with sport and music fans across the world, including through the naming rights to the stadium for the San Francisco 49ers, which we secured in 2013 and extended in 2024. We are focused on strengthening our brands globally.
Our Levi's Brands business, which includes the Levi's, Signature by Levi Strauss & Co.™ and Denizen ® brands, is presented in our financial statements under the caption of Levi's Brands and is defined geographically in three reportable segments: Americas, Europe and Asia.
Our Levi's Brands business, which includes the Levi's ® , Levi Strauss Signature™ and Denizen ® brands, is presented in our financial statements under the caption of Levi's Brands and is defined geographically in three reportable segments: Americas, Europe and Asia.
The price and availability of cotton may fluctuate substantially, depending on a variety of factors, including the effects of inflation. Current price fluctuations impact the cost of our products in future seasons due to the lead time of our product development cycle. Fluctuations in product costs can cause a decrease in our profitability. Sourcing locations .
The price and availability of cotton may fluctuate substantially, depending on a variety of factors, including the effects of inflation. Current price fluctuations impact the cost of our products in future seasons due to the lead time of our product development cycle. Fluctuations in product costs can cause an increase or decrease in our profitability. Sourcing locations .
Beyond Yoga ® is about more than just comfort and performance; the brand has created an inclusive community centered on body positivity, the celebration of diversity, and giving back to causes in which it believes. The company is female-founded, female-run and nearly 90% female-led.
Beyond Yoga ® is about more than just comfort and performance; the brand has created an inclusive community centered on body positivity, the celebration of diversity, and giving back to causes in which it believes. The company is female-founded, female-run and nearly 90% female-led. The brand has seven total stores.
We work vigorously to enforce and protect our trademark rights by engaging in regular market reviews, helping local law enforcement authorities detect and prosecute counterfeiters, issuing cease-and-desist letters against third parties infringing or denigrating our trademarks, opposing registration of infringing trademarks, and initiating litigation as necessary. We are currently pursuing nearly 350 infringement matters around the world.
We work vigorously to enforce and protect our trademark rights by engaging in regular market reviews, helping local law enforcement authorities detect and prosecute counterfeiters, issuing cease-and-desist letters against third parties infringing or denigrating our trademarks, opposing registration of infringing trademarks, and initiating litigation as necessary. We are currently pursuing approximately 320 infringement matters around the world.
In addition to these stores, we consider our network of brand-dedicated shop-in-shops, which are located within department stores and may be either operated directly by us or third parties, to be an important component of our retail distribution in international markets.
In addition to these stores, we consider our network of brand-dedicated shop-in-shops, which are located within department stores and other third-party retail locations and may be either operated directly by us or third parties, to be an important component of our retail distribution in international markets.
In addition to the dedicated stores, we maintain brand-dedicated e-commerce sites that sell products directly to consumers. Company-operated brick-and-mortar retail stores . Our company-operated retail stores, comprising both mainline and outlet stores, generated 29%, 26% and 25% of our net revenues in fiscal years 2023, 2022 and 2021, respectively.
In addition to the dedicated stores, we maintain brand-dedicated e-commerce sites that sell products directly to consumers. Company-operated brick-and-mortar retail stores . Our company-operated retail stores, comprising both mainline and outlet stores, generated 31%, 29% and 26% of our net revenues in fiscal years 2024, 2023 and 2022, respectively.
Our Levi's ® brand products accounted for 87% of our net revenues in each of the fiscal years 2023, 2022 and 2021, respectively, approximately half of which were generated in our Americas segment in each of these years.
Our Levi's ® brand products accounted for 89%, 87%, and 87% of our net revenues in each of the fiscal years 2024, 2023 and 2022, respectively, approximately half of which were generated in our Americas segment in each of these years.
We may have minimum inventory purchase commitments, including fabric commitments, with suppliers that secure a portion of material needs for future seasons. The remainder is sourced from our company-operated manufacturing and finishing plants. See "Item 2 – Properties" for more information about these manufacturing facilities. Sources and availability of raw materials .
We may have minimum inventory purchase commitments, including fabric commitments, with suppliers that secure a portion of material needs for future seasons. The remainder is sourced from our company-operated manufacturing and finishing plant in South Africa. See "Item 2 – Properties" for more information about these manufacturing facilities. Sources and availability of raw materials .
Information contained on, or that can be accessed through, these websites is not intended to be incorporated by reference into this Annual Report and references to our website addressed in this Annual Report are inactive textual references only. Sourcing and Logistics Organization .
Information contained on, or that can be accessed through, these websites is not intended to be incorporated by reference into this Annual Report and references to our website addressed in this Annual Report are inactive textual references only. 10 Table of Contents Sourcing and Logistics Organization .
Our Dockers ® brand products accounted for 5% of our net revenues in each of the fiscal years 2023, 2022 and 2021 and are sold in more than 50 countries. 8 Table of Contents Beyond Yoga ® Brand Our Beyond Yoga ® brand is a body positive, premium athleisure apparel brand focused on quality, fit and comfort for all shapes and sizes.
Our Dockers ® brand products accounted for 5% of our net revenues in each of the fiscal years 2024, 2023 and 2022 and are sold in approximately 50 countries. 8 Table of Contents Beyond Yoga ® Brand Our Beyond Yoga ® brand is a body positive, premium athleisure apparel brand focused on quality, fit and comfort for all shapes and sizes.
For more information on the potential impacts of government regulations affecting our business, see “Item 1A – Risk Factors”. 12 Table of Contents Intellectual Property We have more than 6,200 trademark registrations and pending applications in approximately 180 jurisdictions worldwide, and we acquire rights in new trademarks according to business needs.
For more information on the potential impacts of government regulations affecting our business, see “Item 1A – Risk Factors”. Intellectual Property We have more than 6,100 trademark registrations and pending applications in approximately 180 jurisdictions worldwide, and we acquire rights in new trademarks according to business needs.
In fiscal year 2022, our net revenues in the first, second, third and fourth quarters represented 26%, 24%, 24% and 26%, respectively, of our total net revenues for the year. We typically achieve a significant amount of revenues from our DTC channel on the Friday following Thanksgiving Day, which is commonly referred to as Black Friday.
In fiscal year 2023, our net revenues in the first, second, third and fourth quarters represented 27%, 22%, 24% and 27%, respectively, of our total net revenues for the year. We typically achieve a significant amount of revenues from our DTC channel on the Friday following Thanksgiving Day, which is commonly referred to as Black Friday.
The Levi's ® , Dockers ® , Beyond Yoga ® and 501 ® trademarks, the Arcuate Stitching Design, the Tab Device, the Two Horse ® Design, the Housemark and the Wings and Anchor Design are among our core trademarks. We protect these trademarks by registering them with the U.S.
The Levi's ® , Dockers ® , Beyond Yoga ® and 501 ® trademarks, the Arcuate Stitching Design, the Tab Device, the Two Horse ® Design, the Housemark and the Wings and Anchor Design are among our core trademarks. 12 Table of Contents We protect these trademarks by registering them with the U.S.
Sales to our top ten wholesale customers totaled 28%, 31% and 32% of our net revenues in fiscal years 2023, 2022, and 2021, respectively. No single customer represented 10% or more of our net revenues in any of these years.
Sales to our top ten wholesale customers totaled 26%, 28% and 31% of our net revenues in fiscal years 2024, 2023, and 2022, respectively. No single customer represented 10% or more of our net revenues in any of these years.
Our presence in more than 110 countries enables us to leverage our global scale for product development and sourcing while using our local expertise to tailor products and retail experiences to individual markets. Product procurement . We source nearly all of our products through independent contract manufacturers.
Our presence in approximately 120 countries enables us to leverage our global scale for product development and sourcing while using our local expertise to tailor products and retail experiences to individual markets. Product procurement . We source nearly all of our products through independent contract manufacturers.
Under our Levi's ® , Dockers ® , Signature by Levi Strauss & Co.™ and Denizen ® brands, we design, market and sell – directly or through third parties and licensees – products that include jeans, casual and dress pants, tops, shorts, skirts, dresses, jackets, footwear, and related accessories for men, women and children around the world.
Under our Levi's ® , Dockers ® , Levi Strauss Signature™, Denizen ® and Beyond Yoga ® brands, we design, market and sell – directly or through third parties and licensees – 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.
The intent of our sustainability strategy is to be a leader in transparency and impact, to accelerate the circular economy ecosystem, and to increase collaboration in the apparel industry by inspiring employees, communities and value chain partners to join our journey toward an inclusive and regenerative industry in which all people are treated with dignity and respect.
The intent of our sustainability strategy is to be a leader in transparency and impact, to accelerate the circular economy ecosystem, and to inspire employees, communities and value chain partners to join our journey toward an inclusive and regenerative industry in which all people are treated with dignity and respect.
The Dockers ® and Beyond Yoga ® businesses are presented in our financial statements under the caption of Other Brands. Our Global Reach Our products are sold in more than 110 countries. We service our customers through our global infrastructure, developing, sourcing and marketing our products around the world.
The Dockers ® and Beyond Yoga ® businesses are presented in our financial statements under the caption of Other Brands. Our Global Reach Our products are sold in approximately 120 countries. We service our customers through our global infrastructure, developing, sourcing and marketing our products around the world.
Although our brands are recognized as authentically “American”, we derived over half of our net revenues from outside the United States in fiscal year 2023. Our products are sold in over 45,000 retail locations worldwide, including approximately 3,200 brand-dedicated stores and shop-in-shops.
Although our brands are recognized as authentically “American”, we derived over half of our net revenues from outside the United States in fiscal year 2024. Our products are sold in approximately 50,000 retail locations worldwide, including approximately 3,400 brand-dedicated stores and shop-in-shops.
These sites represented 9%, 7% and 8% of total net revenues in fiscal years 2023, 2022 and 2021, respectively; and 20%, 19% and 21% of DTC channel net revenues in fiscal years 2023, 2022 and 2021, respectively.
These sites represented 10%, 9% and 7% of total net revenues in fiscal years 2024, 2023 and 2022, respectively; and 21%, 20% and 19% of DTC channel net revenues in fiscal years 2024, 2023 and 2022, respectively.
During 2023, we added 152 company-operated stores and closed 69 stores. Franchised and other stores . Franchised, licensed, or other forms of brand-dedicated stores operated by independent third parties sell Levi's ® and Dockers ® products in markets outside the United States.
During 2024, we added 157 company-operated stores and closed 53 stores. Franchised and other stores . Franchised, licensed, or other forms of brand-dedicated stores operated by independent third parties sell Levi's ® and Dockers ® products in markets outside the United States.
We regularly evaluate and refine our code of conduct processes. • We regularly assess manufacturing and finishing facilities against our supplier code of conduct through periodic on-site facility inspections and improvement activities, including use of independent monitors to supplement our internal staff. We integrate review and performance results into our sourcing decisions.
We regularly evaluate and refine our code of conduct processes. • We regularly assess manufacturing and finishing facilities against our supplier code of conduct through periodic on-site facility inspections and improvement activities, including use of independent monitors to supplement our internal staff.
In fiscal year 2023, we sourced product from independent contract manufacturers located in approximately 32 countries around the world, with no more than 30% sourced from any single country, in line with our updated sourcing strategy for the post-COVID environment. We sourced products in North and South Asia, the Americas, including the United States, Europe and Africa. Sourcing practices .
In fiscal year 2024, we sourced product from independent contract manufacturers located in approximately 28 countries around the world, with no more than 30% sourced from any single country, in line with our sourcing strategy. We sourced products in North and South Asia, the Americas, including the United States, Europe and Africa. Sourcing practices .
The salespeople involved in these transactions are generally our employees and not those of the retailer. We recognize revenue in the amount of the sale to the end consumer, while paying our partners a commission. We operated approximately 550 of these shop-in-shops as of November 26, 2023.
The salespeople involved in these transactions are generally our employees and not those of the retailer. We recognize revenue in the amount of the sale to the end consumer, while paying our partners a commission. We operated approximately 600 of these shop-in-shops as of December 1, 2024.
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 month of that quarter. Fiscal years 2023, 2022 and 2021 were 52-week years, ending on November 26, 2023, November 27, 2022 and November 28, 2021, respectively.
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 month of that quarter. Fiscal year 2024 was a 53-week year, ending on December 1, 2024 and fiscal years 2023 and 2022 were 52-week years, ending on November 26, 2023 and November 27, 2022, respectively.
For more information, see “Item 2 – Properties”. 11 Table of Contents Distribution center activities include receiving finished goods from our contract manufacturers and plants, inspecting those products, preparing them for retail presentation, and shipping them to our customers, our e-commerce consumers, and to our own stores. Our distribution centers maintain a combination of replenishment and seasonal inventory.
Distribution center activities include receiving finished goods from our contract manufacturers and plants, inspecting those products, preparing them for retail presentation, and shipping them to our customers, our e-commerce consumers, and to our own stores. Our distribution centers maintain a combination of replenishment and seasonal inventory.
Our climate pillar encompasses environmental impacts, including climate action, water stewardship and biodiversity; our consumption pillar encompasses circular economy, resale and upcycling initiatives, use of sustainable fibers, safer chemicals and waste and plastic reduction; and our community pillar encompasses social and societal impacts, including diversity, equity and inclusion, employee support and development, supply chain transparency, investing in our communities through advocacy and volunteering.
The consumption pillar focuses on the circular economy, resale and upcycling initiatives, use of sustainable fibers, safer chemicals and waste and plastic reduction. The community pillar encompasses social and societal impacts, including diversity and inclusion; employee support and development; supply chain transparency; and investing in our communities through advocacy and volunteering.
Outside the United States, approximately 120 of these shop-in-shops were operated by third parties as of November 26, 2023. 9 Table of Contents E-commerce sites . We maintain brand-dedicated e-commerce sites, including www.levi.com , www.dockers.com and www.beyondyoga.com , that sell products directly to consumers across multiple markets around the world.
Outside the United States, approximately 110 of these shop-in-shops were operated by third parties as of December 1, 2024. E-commerce sites . We maintain brand-dedicated e-commerce sites, including www.levi.com , www.dockers.com and www.beyondyoga.com , that sell products directly to consumers across multiple markets around the world.
As of such date, approximately 1,600 of our employees were associated with the manufacturing and procurement of our products, 10,200 worked in retail, including seasonal employees, 2,100 worked in distribution and 5,200 were other non-production employees. As of November 26, 2023, approximately 5,300 of our employees were represented by a labor union or covered by a collective bargaining agreement.
As of such date, approximately 800 of our employees were associated with the manufacturing and procurement of our products, 10,800 worked in retail, including seasonal employees, 1,900 worked in distribution and 5,200 were other non-production employees. As of December 1, 2024, approximately 5,800 of our employees were represented by a labor union or covered by a collective bargaining agreement.
We also had 29 international and foreign patent applications pending. We will continually assess the ability to patent new intellectual property as we develop technologies that we believe are innovative, such as our F.L.X. technology. History and Corporate Citizenship Our story began in San Francisco, California in 1853 as a wholesale dry goods business.
We also had 16 international and foreign patent applications pending. We will continually assess the ability to patent new intellectual property as we develop technologies that we believe are innovative. History and Corporate Citizenship Our story began in San Francisco, California in 1853 as a wholesale dry goods business. We invented the blue jean 20 years later.
Seasonality of Sales We typically achieve our largest quarterly revenues in the fourth quarter. In fiscal year 2023, our net revenues in the first, second, third and fourth quarters represented 27%, 22%, 24% and 27%, respectively, of our total net revenues for the year.
Seasonality of Sales 9 Table of Contents We typically achieve our largest quarterly revenues in the fourth quarter. In fiscal year 2024, our net revenues in the first, second, third and fourth quarters represented 24%, 23%, 24% and 29%, respectively, of our total net revenues for the fiscal year.
We also work with trade groups and industry participants seeking to strengthen laws relating to the protection of intellectual property rights in markets around the world. As of November 26, 2023, we had 65 issued U.S. patents, 15 issued foreign patents and 48 U.S. patent applications pending. Our patents expire between 2025 and 2042.
We also work with trade groups and industry participants seeking to strengthen laws relating to the protection of intellectual property rights in markets around the world. As of December 1, 2024, we had 82 issued U.S. patents, 17 issued foreign patents and 23 U.S. patent applications pending. Our patents expire between 2025 and 2043.
Our aim is to continue fortifying each pillar, to deliver meaningful progress while evolving our efforts to ensure our business becomes more sustainable. Human Capital Management As of November 26, 2023, we employed approximately 19,100 people, approximately 9,500 of whom were located in the Americas, 4,500 of whom were located in Europe, and 5,100 of whom were located in Asia.
Our aim is to continue fortifying each pillar to deliver meaningful progress while evolving our efforts to ensure our business becomes more sustainable. Human Capital Management As of December 1, 2024, we employed approximately 18,700 people, approximately 9,900 of whom were located in the Americas, 3,800 of whom were located in Europe, and 5,000 of whom were located in Asia.
There were approximately 1,200 of these stores as of November 26, 2023, and they are a key element of our international distribution.
There were approximately 1,300 of these stores as of December 1, 2024, and they are a key element of our international distribution.
The Levi's ® brand encompasses a range of products. Levi's ® Red Tab™ products are the foundation of the brand, consisting of a wide spectrum of jeans and jeanswear offered in a variety of fits, fabrics, finishes, styles and price points intended to appeal to a broad spectrum of consumers.
Levi's ® Red Tab™ products are the foundation of the brand, consisting of a wide spectrum of jeans and jeanswear offered in a variety of fits, fabrics, finishes, styles and price points intended to appeal to a broad spectrum of consumers. The line includes the iconic 501 ® jean, the original and best-selling five-pocket jean of all time.
Through product and communications, our plan is to drive impact and engage the hearts and minds of our consumers while connecting directly and delivering the best experience possible through our DTC channel.
Through product and communications, our plan is to drive impact and engage the hearts and minds of our consumers while connecting directly and delivering the best experience possible through our DTC channel. In 2024, we deepened our direct, personalized relationships with our consumers through the expansion of our global loyalty programs.
To help fulfill our commitment to fair and equitable compensation, we conduct an independent pay equity audit every other year for our U.S. non-union population, with the most recent audit completed in 2022.
To help fulfill our commitment to fair and equitable compensation, we historically conducted an independent pay equity audit every other year for our U.S. non-union population, with the most recent audit completed in 2022. In 2023 we developed in-house capabilities with oversight from outside counsel to run a similar analysis annually.
The goals include targets tied to various areas across our sustainability strategy and collectively reflect our guiding philosophy of profits through principles. Our sustainability strategy centers on three main pillars — climate, consumption, and community.
The goals include targets tied to various areas across our sustainability strategy and collectively reflect our guiding philosophy of profits through principles. Our sustainability strategy is built around three main pillars — climate, consumption and community. Our climate pillar addresses environmental impacts, including climate action, water stewardship and biodiversity.
Today, descendants of the family of Levi Strauss continue to be actively involved in our company. Our Class B common stock is primarily owned by these descendants and their relatives and trusts established for their behalf.
The Dockers ® brand helped drive “Casual Friday” in the 1990s and has been a cornerstone of casual menswear for more than 30 years. Today, descendants of the family of Levi Strauss continue to be actively involved in our company. Our Class B common stock is primarily owned by these descendants and their relatives and trusts established for their behalf.
Sales, Distribution and Customers 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.
Our Beyond Yoga ® brand products accounted for 2% of our net revenues in each of the fiscal years 2024, 2023, and 2022. Sales, Distribution and Customers 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.
Tops – including shirts, sweaters, jackets, dresses and jumpsuits – represented 26%, 26% and 25% of our total units sold in fiscal years 2023, 2022 and 2021, respectively. The remainder of our products are footwear and accessories. Men's products generated 64%, 65% and 65% of our net revenues in fiscal years 2023, 2022 and 2021, respectively.
Tops – 7 Table of Contents including shirts, sweaters, jackets, dresses and jumpsuits – represented 27%, 26% and 26% of our total units sold in fiscal years 2024, 2023 and 2022, respectively. The remainder of our products are footwear, which represented 2% of our total units sold in fiscal years 2024, 2023, and 2022, and accessories.
We have not experienced any work stoppages, and we consider our relations with our employees to be good. Diversity, Equity, and Inclusion. We believe in living our values: originality, empathy, integrity and courage. This means we strive to create a workplace where everyone feels valued, empowered and welcomed to be their authentic selves.
We have not experienced any work stoppages, and we consider our relations with our employees to be good. Diversity and Inclusion. We believe in living our values: originality, empathy, integrity courage and performance. This means we strive to create a workplace that reflects our consumers and communities in which we conduct our business.
Marketing and Promotion Our marketing is rooted in globally consistent brand messages that reflect the unique attributes of our brands, including the Levi's ® brand as the authentic and original jeanswear brand and Dockers ® brand as the definitive khaki.
For more information regarding risks we face with respect to inflation, see “Item 1A – Risk Factors”. Marketing and Promotion Our marketing is rooted in globally consistent brand messages that reflect the unique attributes of our brands, including the Levi's ® brand as the authentic and original jeanswear brand and Dockers ® brand as the definitive khaki.
Dockers ® Brand Founded in 1986, the Dockers ® brand sparked a revolution in the way millions of men dressed around the world, shifting from the standard issue suit to a more casual look.
Our Denizen ® brand products accounted for 1%, 1% and 2% of our net revenues in fiscal years 2024, 2023 and 2022, respectively. Dockers ® Brand Founded in 1986, the Dockers ® brand sparked a revolution in the way millions of men dressed around the world, shifting from the standard issue suit to a more casual look.
Substantially all of our global trademarks are owned by Levi Strauss & Co. or its wholly-owned affiliates. We regard our trademarks as one of our most valuable assets and believe they have substantial value in the marketing of our products.
We regard our trademarks as one of our most valuable assets and believe they have substantial value in the marketing of our products.
Sales of Red Tab™ products represented the majority of our Levi's ® brand net revenues globally in fiscal years 2023, 2022 and 2021. We offer premium products around the world under the Levi's ® brand, including a range of premium pants, tops, shorts, skirts, jackets, footwear, and related accessories.
We offer premium products around the world under the Levi's ® brand, including a range of premium pants, tops, shorts, skirts, jackets, footwear, and related accessories.
Across all of our brands, pants – including jeans, casual pants, dress pants and activewear – represented 68%, 67% and 67% of our total units sold in fiscal years 2023, 2022 and 2021, respectively.
Our Brands and Products We offer a broad range of products including jeans, casual and dress pants, activewear, tops, shorts, skirts, dresses, jackets, footwear and related accessories. Across all of our brands, pants – including jeans, casual pants, dress pants and activewear – represented 67%, 68%and 67% of our total units sold in fiscal years 2024, 2023 and 2022, respectively.
The Levi's ® brand continues to evolve to meet the tastes of today's consumers, driven by its distinctive pioneering and innovative spirit. Our range of leading jeanswear, other apparel items and accessories for men, women and children is available in more than 110 countries, allowing individuals around the world to express their personal style.
Our range of leading jeanswear, other apparel items and accessories for men, women and children is available in approximately 120 countries, allowing individuals around the world to express their personal style. The Levi's ® brand encompasses a range of products.
Women's products generated 34%, 33% and 33% of our net revenues in fiscal years 2023, 2022 and 2021, 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%, 38%, and 37% of our net revenues in fiscal years 2023, 2022 and 2021, respectively.
Products other than denim bottoms – which include tops, footwear and accessories and pants excluding jeans – represented 39%, 39%, and 38% of our net revenues in fiscal years 2024, 2023 and 2022, respectively. Levi's ® Brand The Levi's ® brand epitomizes classic, authentic American style and effortless cool.
In addition to our DTC initiatives, we will also focus on our wholesale channel, partnering with customers that are focused on delivering high quality results and service to our consumers, while also elevating our Levi’s ® brand. • Further Diversify our Portfolio : We plan to accelerate growth in international markets, with a focus on high-growth markets.
In addition to our DTC initiatives, we will also focus on our wholesale channel, partnering with customers that are focused on delivering high quality results and service to our consumers, while also elevating our Levi’s ® brands. • Power the Portfolio : We plan to accelerate our global reach while ensuring our U.S. operations continue to deliver steady growth, including unlocking the potential of Beyond Yoga.
We believe these actions will drive efficiencies, reduce lead times and allow us to respond quickly to changes in consumer demand while also improving our inventory turns, working capital and cash conversion cycle. • Financial Discipline : We plan to continue to manage our costs aggressively so that we can invest in the areas that will drive growth and help us deliver Adjusted EBIT margins of 15% over the long term.
We believe these actions will drive efficiencies, reduce lead times and allow us to respond quickly to changes in consumer demand while also improving our inventory turns, working capital and cash conversion cycle.
We invented the blue jean 20 years later. In 1873, we received a U.S. patent for “waist overalls” with metal rivets at points of strain. The first product line designated by the lot number “501” was created in 1890.
In 1873, we received a U.S. patent for “waist overalls” with metal rivets at points of strain. The first product line designated by the lot number “501” was created in 1890. In the 19 th and early 20 th centuries, our work pants were worn primarily by cowboys, miners and other working men in the western United States.
As of November 26, 2023, we had 1,172 company-operated stores located in 37 countries. The majority of the stores are dedicated to the Levi's ® brand, with 412 stores in the Americas, 291 stores in Europe, and 366 stores in Asia. We had 97 Dockers ® brand-dedicated stores globally and we opened six Beyond Yoga ® stores during the year.
As of December 1, 2024, we had 1,276 company-operated stores located in 39 countries. The majority of the stores are dedicated to the Levi's ® brand, with 458 stores in the Americas, 299 stores in Europe, and 406 stores in Asia. We had 106 Dockers ® brand-dedicated stores globally and 7 Beyond Yoga ® stores as of December 1, 2024.
We plan to continue elevating and strengthening all of our brands through integrating product, design, positioning, marketing and consumer experience to ensure they are the “Center of Culture”. We will drive growth in women's and tops through a sharpened focus on denim dressing and denim lifestyle, building end-to-end capability in key lifestyle apparel categories beyond jeans.
We plan to continue elevating and strengthening all of our brands through integrating product, design, positioning, marketing and consumer experience to ensure they are the “Center of Culture”.
Our audit confirmed that we do not have any systemic pay differences across gender and ethnicity. We are expanding our pay equity audits to include new markets. We’re also focused on eliminating bias and increasing transparency in pay practices and salary ranges and ensuring objectivity around compensation rewards. Total Rewards.
We found no statistically significant gender pay differences across these markets. We’re also focused on eliminating bias and increasing transparency in pay practices and salary ranges and ensuring objectivity around compensation rewards. Total Rewards.
As we grow net revenues and gross margins, we plan to drive leverage on our investments, improve our structural economics across channels, and deliver Returns on invested capital of greater than 23% over the long term.
We plan to continue to manage our costs aggressively so that we can invest in the areas that will drive growth and help us deliver Adjusted EBIT margins of 15% over the long term. As we grow net revenues and gross margins, we plan to drive leverage on our investments, and improve our structural economics across channels.
The line includes the iconic 501 ® jean, the original and best-selling five-pocket jean of all time. In 2023, we celebrated the 150 th anniversary of the 501 ® jean. The line also incorporates a full range of jeanswear fits and styles designed specifically for women.
In 2023, we celebrated the 150 th anniversary of the 501 ® jean. The line also incorporates a full range of jeanswear fits and styles designed specifically for women. Sales of Red Tab™ products represented the majority of our Levi's ® brand net revenues globally in fiscal years 2024, 2023 and 2022.
Since their inception in 1873, Levi's ® jeans have become one of the most recognizable garments in the world – reflecting the aspirations and earning the loyalty of people for generations. Consumers around the world instantly recognize the distinctive traits of Levi's ® jeans, including the Arcuate Stitching Design and the Red Tab Device.
Levi's ® is an authentic and original lifestyle brand and the #1 brand globally in jeanswear (measured by total retail sales). Since their inception in 1873, Levi's ® jeans have become one of the most recognizable garments in the world – reflecting the aspirations and earning the loyalty of people for generations.
By the 1960s, they had become a symbol of American culture, representing a unique blend of history and youth. We opened our export and international businesses in the 1950s and 1960s, respectively. The Dockers ® brand helped drive “Casual Friday” in the 1990s and has been a cornerstone of casual menswear for more than 30 years.
Then, in 1934, we introduced our first jeans for women, and after World War II, our jeans began to appeal to a wider market. By the 1960s, they had become a symbol of American culture, representing a unique blend of history and youth. We opened our export and international businesses in the 1950s and 1960s, respectively.
We plan to achieve growth expectations in under-penetrated parts of our business such as tops and women's, expanding our addressable market. Our success will be driven not just by what we do, but how we do it.
Our success will be driven not just by what we do, but how we do it.
Our Signature by Levi Strauss & Co.™ and Denizen ® brand products collectively accounted for 5%, 6% and 8% of our net revenues in fiscal years 2023, 2022 and 2021, respectively.
In the first quarter of 2024 we announced the strategic decision to discontinue the Denizen ® brand with operations winding down during fiscal year 2024 and into 2025. Our Levi Strauss Signature™ products accounted for 3%, 4% and 4% of our net revenues in fiscal years 2024, 2023 and 2022, respectively.
We encourage collaboration among apparel companies in factory monitoring and improvement. • We regularly disclose the names and locations of our vendors to provide transparency into our supply chain. Logistics . We use company-operated and third-party distribution facilities to warehouse and ship products to our wholesale customers, retail stores and e-commerce customers.
We integrate review and performance results into our sourcing decisions. • We regularly disclose the names and locations of our vendors to provide transparency into our supply chain. Logistics .
Removed
Our newest brand, Beyond Yoga ® , acquired in 2021, is a body positive, premium athleisure apparel brand focused on quality, fit and comfort for all shapes and sizes.
Added
In the first quarter of 2024 we announced the strategic decision to discontinue the Denizen ® brand. In the fourth quarter of 2024 we announced we are undertaking an evaluation of strategic alternatives to the global Dockers ® business, including a sale or other strategic transactions.
Removed
Our three strategic choices are supported by a foundation of the following three “how to win” choices: • Digital Transformation : Our vision for enterprise-wide digital transformation is to create a superior consumer experience and drive profitability through digital technology, data and artificial intelligence ("AI"), and new ways of working.
Added
We will continue men’s bottoms denim leadership globally while driving outsized growth in women's and tops through a sharpened focus on denim dressing and denim lifestyle, building end-to-end capability in key lifestyle apparel categories beyond jeans.
Removed
We have been investing, and plan to continue to invest in key omni-channel capabilities, digital tools across the business and upgrading our enterprise resource planning system, all of which create a more simplified work environment.
Added
Our three strategic choices are supported by a foundation of the following enablers: • One Team : We will harness our talent, culture and values as competitive advantages by fostering a collaborative and inclusive culture where everyone brings their full selves to work, cultivating industry-leading talent and empowering the teams who serve our fans. • Operational Excellence : We will execute with excellence and leverage our global scale by continuing to look for ways to embrace agility, reduce complexity and further streamline our ways of working.
Removed
We believe these efforts will contribute towards growing our digital footprint and achieving higher operating margins. • Operational Excellence : We will continue to look for ways to embrace agility, reduce complexity and further streamline our ways of working.
Added
For more information on our calculation of Adjusted EBIT margin, see “Item 7 – Management’s Discussion and Analysis – Non-GAAP Financial Measures.” A reconciliation of non-GAAP forward looking information to the corresponding GAAP measures cannot be provided without unreasonable efforts due to the challenge in quantifying various items including but not limited to, the effects of foreign currency fluctuations, taxes, and any future restructuring, restructuring-related, severance and other charges.
Removed
We define Return on invested capital as the trailing four quarters of Adjusted net income before interest and after taxes divided by the average trailing five quarters of total invested capital. We define total invested capital as total debt plus shareholders' equity less cash and short-term investments.
Added
Men's products generated 63%, 64% and 65% of our net revenues in fiscal years 2024, 2023 and 2022, respectively. Women's products generated 36%, 34% and 33% of our net revenues in fiscal years 2024, 2023 and 2022, respectively. The remainder of our products are non-gendered.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeWe rely significantly on information technology and data to operate our business, including our supply chain and retail operations, and any failure, inadequacy, compromise or interruption of that technology or data, or those of third parties upon which we rely, could lead to adverse consequences, including but not limited to regulatory investigations or actions, litigation, fines and penalties, harm to our ability to effectively operate our business, claims that we breached our data privacy security obligations, harm to our reputation and a loss of customers or sales In the ordinary course of our business, we may collect, store, use, transmit, disclose or otherwise process proprietary confidential and sensitive data, including personal information, intellectual property, and trade secrets, and we rely upon third parties (such as service providers) for data processing-related activities.
Biggest changeIn the ordinary course of our business, we may collect, store, use, transmit, disclose or otherwise process proprietary confidential and sensitive data, including personal information, intellectual property, and trade secrets, and we rely upon third parties (such as service providers) for data processing-related activities.
We have and may continue to be subject to a variety of evolving threats, including but not limited to social engineering, such as phishing, malicious code (such as viruses and worms), malware (including as a result of advanced persistent threat intrusions), denial-of-service attacks (such as credential stuffing), personnel misconduct or error, supply-chain attacks, software bugs, server malfunctions and large-scale, complex automated attacks that can evade detection for long periods of time.
We have and may continue to be subject to a variety of evolving threats, including but not limited to social engineering, such as phishing, malicious code (such as viruses and worms), malware (including as a result of advanced persistent threat intrusions), denial-of-service attacks, credential stuffing, personnel misconduct or error, supply-chain attacks, software bugs, server malfunctions and large-scale, complex automated attacks that can evade detection for long periods of time.
While we believe we conduct appropriate diligence before entering into agreements with any outsourcing entity, the failure of one or more of such entities to meet our performance standards and expectations, including with respect to data security, compliance with data protection and privacy laws, providing services on a timely basis or providing services at the prices we expect, may have an adverse effect on our results of operations or financial condition.
While we believe we conduct appropriate diligence before entering into agreements with any outsourcing entity, the failure of one or more of such entities to meet our performance standards and expectations, including with respect to data security, compliance with data protection and privacy laws, providing quality services on a timely basis or providing services at the prices we expect, may have an adverse effect on our results of operations or financial condition.
The market price of our Class A common stock may fluctuate or decline significantly in response to numerous factors, many of which are beyond our control, including: • actual or anticipated fluctuations in our revenues or other operating results; • variations between our actual operating results and the expectations of securities analysts, investors and the financial community; • any forward-looking financial or operating information we may provide to the public or securities analysts, any changes in this information or our failure to meet expectations based on this information; • actions of securities analysts who initiate or maintain coverage of us, changes in financial estimates by any securities analysts who follow our company or our failure to meet these estimates or the expectations of investors; • whether investors or securities analysts view our stock structure unfavorably, particularly our dual-class structure; • additional shares of Class A common stock being sold into the market by us or our existing stockholders, or the anticipation of such sales; • announcements by us or our competitors of significant products or features, innovations, acquisitions, strategic partnerships, joint ventures, capital commitments, divestitures or other dispositions; • changes in operating performance and stock market valuations of companies in our industry, including our vendors and competitors; • price and volume fluctuations in the overall stock market, including as a result of general economic trends, including inflationary pressures; • lawsuits threatened or filed against us, or events that negatively impact our reputation; • developments in new legislation and pending lawsuits or regulatory actions, including interim or final rulings by judicial or regulatory bodies; and • other events or factors, including those resulting from the macroeconomic environment, geopolitical activities, war, incidents of terrorism, natural disasters, industrial accidents, pandemics (including the COVID-19 pandemic), or responses to these events.
The market price of our Class A common stock may fluctuate or decline significantly in response to numerous factors, many of which are beyond our control, including: • actual or anticipated fluctuations in our revenues or other operating results; • variations between our actual operating results and the expectations of securities analysts, investors and the financial community; • any forward-looking financial or operating information we may provide to the public or securities analysts, any changes in this information or our failure to meet expectations based on this information; • actions of securities analysts who initiate or maintain coverage of us, changes in financial estimates by any securities analysts who follow our company or our failure to meet these estimates or the expectations of investors; • whether investors or securities analysts view our stock structure unfavorably, particularly our dual-class structure; • additional shares of Class A common stock being sold into the market by us or our existing stockholders, or the anticipation of such sales; • announcements by us or our competitors of significant products or features, innovations, acquisitions, strategic partnerships, joint ventures, capital commitments, divestitures or other dispositions; • changes in operating performance and stock market valuations of companies in our industry, including our vendors and competitors; • price and volume fluctuations in the overall stock market, including as a result of general economic trends, including inflationary pressures; • lawsuits threatened or filed against us, or events that negatively impact our reputation; • developments in new legislation and pending lawsuits or regulatory actions, including interim or final rulings by judicial or regulatory bodies; and • other events or factors, including those resulting from the macroeconomic environment, geopolitical activities, war, incidents of terrorism, natural disasters, industrial accidents, pandemics, or responses to these events.
If additional tariffs or trade restrictions are implemented by the United States or other countries in connection with a global trade war, the cost of our products manufactured in China or other countries and imported into the United States or other countries could increase, which in turn could adversely affect the demand for these products and have an adverse effect on our business and results of operations.
If additional tariffs or trade restrictions are implemented by the United States or other countries in connection with a global trade war, the cost of our products manufactured in China, Mexico or other countries and imported into the United States or other countries could increase, which in turn could adversely affect the demand for these products and have an adverse effect on our business and results of operations.
In particular, our amended and restated certificate of incorporation and amended and restated bylaws: • establish a classified board of directors so that not all members are elected at one time; • permit our board of directors to establish the number of directors and fill any vacancies and newly-created directorships; • authorize the issuance of “blank check” preferred stock that our board of directors could use to implement a stockholder rights plan; • provide that our board of directors is expressly authorized to make, alter or repeal our bylaws; 36 Table of Contents • restrict the forum for certain litigation against us to Delaware or to Federal court; • reflect the dual class structure of our common stock; and • establish advance notice requirements for nominations for election to our board of directors or for proposing matters that can be acted upon by stockholders.
In particular, our amended and restated certificate of incorporation and amended and restated bylaws: • establish a classified board of directors so that not all members are elected at one time; • permit our board of directors to establish the number of directors and fill any vacancies and newly-created directorships; • authorize the issuance of “blank check” preferred stock that our board of directors could use to implement a stockholder rights plan; • provide that our board of directors is expressly authorized to make, alter or repeal our bylaws; 37 Table of Contents • restrict the forum for certain litigation against us to Delaware or to Federal court; • reflect the dual class structure of our common stock; and • establish advance notice requirements for nominations for election to our board of directors or for proposing matters that can be acted upon by stockholders.
Negative claims or publicity involving us or our products, the production methods 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.
Negative claims or publicity involving us or our products, 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.
The loss of high-quality employees, including members of our executive management and other key employees, or the failure to attract and retain key personnel or maintain our workplace culture could harm our business.
The loss of high-quality employees, including members of our executive management team and other key employees, or the failure to attract and retain key personnel or maintain our workplace culture could harm our business.
We may be unable to maintain or increase sales of our products through these distribution channels for several reasons, including the following: • the retailers in these channels maintain—and seek to grow—substantial private-label and exclusive offerings as they strive to differentiate the brands and products they offer from those of their competitors; • the retailers change their apparel strategies in a way that shifts focus away from our typical consumer or that otherwise results in a reduction of sales of our products generally, such as a reduction of fixture spaces devoted to our products or a shift to other brands; • other channels, including vertically-integrated specialty stores and e-commerce sites, account for a substantial portion of jeanswear and casual wear sales.
We may be unable to maintain or increase sales of our products through these distribution channels for several reasons, including the following: • the retailers in these channels maintain—and seek to grow—substantial private-label and exclusive offerings as they strive to differentiate the brands and products they offer from those of their competitors; 21 Table of Contents • the retailers change their apparel strategies in a way that shifts focus away from our typical consumer or that otherwise results in a reduction of sales of our products generally, such as a reduction of fixture spaces devoted to our products or a shift to other brands; • other channels, including vertically-integrated specialty stores and e-commerce sites, account for a substantial portion of jeanswear and casual wear sales.
If any analyst who may cover us were to cease coverage of us or fail to regularly publish reports on us, we could lose visibility in the financial markets, which in turn could cause the trading price or trading volume of our Class A common stock to decline. 35 Table of Contents Future securities issuances could result in significant dilution to our stockholders and impair the market price of our Class A common stock.
If any analyst who may cover us were to cease coverage of us or fail to regularly publish reports on us, we could lose visibility in the financial markets, which in turn could cause the trading price or trading volume of our Class A common stock to decline. 36 Table of Contents Future securities issuances could result in significant dilution to our stockholders and impair the market price of our Class A common stock.
The price and availability of cotton may fluctuate substantially, depending on a variety of factors, including demand, acreage devoted to cotton crops and crop yields, weather, supply conditions, transportation costs, energy prices, work stoppages, government regulation, sanctions and policy, economic climates, market speculation, compliance with our working condition, environmental protection, other standards and other unpredictable factors.
The price and availability of cotton may fluctuate substantially, depending on a variety of factors, including demand, acreage devoted to cotton crops and crop yields, climate change, weather, supply conditions, transportation costs, energy prices, work stoppages, government regulation, sanctions and policy, economic climates, market speculation, compliance with our working condition, environmental protection, other standards and other unpredictable factors.
Accordingly, we cannot assure you of the likelihood that an active trading market for our Class A common stock will be maintained, the liquidity of any trading market, your ability to sell your shares of Class A common stock when desired or the prices that you may obtain for your shares. 34 Table of Contents Future sales of our Class A common stock by existing stockholders could cause our stock price to decline.
Accordingly, we cannot assure you of the likelihood that an active trading market for our Class A common stock will be maintained, the liquidity of any trading market, your ability to sell your shares of Class A common stock when desired or the prices that you may obtain for your shares. 35 Table of Contents Future sales of our Class A common stock by existing stockholders could cause our stock price to decline.
For example, we are required to observe certain laws relating to economic sanctions, including those implemented by the U.S. Department of the 29 Table of Contents Treasury’s Office of Foreign Assets Control (OFAC) and other sanctions authorities. These requirements may prohibit or restrict activities relating to certain individuals, entities, countries or territories.
For example, we are 30 Table of Contents required to observe certain laws relating to economic sanctions, including those implemented by the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) and other sanctions authorities. These requirements may prohibit or restrict activities relating to certain individuals, entities, countries or territories.
In the event of default or failure of one or more of our counterparties, we could incur significant losses or our financial liquidity could be adversely impacted, which could negatively impact our results of operations and financial condition. 32 Table of Contents We have debt and interest payment requirements at a level that may restrict our future operations.
In the event of default or failure of one or more of our counterparties, we could incur significant losses or our financial liquidity could be adversely impacted, which could negatively impact our results of operations and financial condition. 33 Table of Contents We have debt and interest payment requirements at a level that may restrict our future operations.
This may require significant additional costs associated with resolving such action in other jurisdictions and there can be no assurance that the provisions will be enforced by a court in those other jurisdictions. 37 Table of Contents Item 1B. UNRESOLVED STAFF COMMENTS Not applicable.
This may require significant additional costs associated with resolving such action in other jurisdictions and there can be no assurance that the provisions will be enforced by a court in those other jurisdictions. 38 Table of Contents Item 1B. UNRESOLVED STAFF COMMENTS Not applicable.
In addition, we, our senior executives and the descendants of the family of our founder, Levi Strauss, may from time to time take positions 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, we, 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.
Current economic and political conditions make tax laws and regulations, or their interpretation and application, in any jurisdiction subject to significant change. 30 Table of Contents Recent tax legislation and regulations, including the enactment of a new corporate minimum tax in the U.S. and the U.S.
Current economic and political conditions make tax laws and regulations, or their interpretation and application, in any jurisdiction subject to significant change. 31 Table of Contents Recent tax legislation and regulations, including the enactment of a new corporate minimum tax in the U.S. and the U.S.
In addition, 33 Table of Contents macroeconomic conditions such as increased volatility or disruption in the credit markets could adversely affect our ability to obtain financing or refinance existing debt on terms that would be acceptable to us.
In 34 Table of Contents addition, macroeconomic conditions such as increased volatility or disruption in the credit markets could adversely affect our ability to obtain financing or refinance existing debt on terms that would be acceptable to us.
In the event of a significant disruption or unavailability in the supply of the fabrics or raw materials used by our vendors in the manufacture of our products, our vendors might not be able to locate alternative suppliers of materials of comparable quality at an acceptable price.
In the event of a significant disruption or unavailability in the supply of the fabrics, synthetics or other raw materials used by our vendors in the manufacture of our products, our vendors might not be able to locate alternative suppliers of materials of comparable quality at an acceptable price.
Any of these outcomes could have a material adverse effect on our business, including unwanted media attention, impairment of our consumer and customer relationships, damage to our reputation, resulting in lost sales, fines, lawsuits (including class actions), government enforcement actions (for example, investigations, fines, penalties, audits and inspections) or significant legal and remediation expenses.
Any of these outcomes could have a material adverse effect on our business, including unwanted media attention, impairment of our consumer and customer relationships, damage to our reputation, and the value of our brands, resulting in lost sales, fines, lawsuits (including class actions), government enforcement actions (for example, investigations, fines, penalties, audits and inspections) or significant legal and remediation expenses.
Our future growth depends in part on our continued expansion efforts in existing markets and in new markets where we may have limited familiarity and experience with regulatory environments and market practices. In particular, one of our key strategies is to further diversify our portfolio and grow market share across geographies, categories, genders and channels.
Our future growth depends in part on our continued expansion efforts in existing markets and in new markets where we may have limited familiarity and experience with regulatory environments and market practices. In particular, one of our key 22 Table of Contents strategies is to further diversify our portfolio and grow market share across geographies, categories, genders and channels.
As a result, we must locate and secure production capacity. We depend on contract manufacturers to maintain adequate financial resources, including access to sufficient credit, to secure a sufficient supply of raw materials, and maintain sufficient development and manufacturing capacity in an environment characterized by continuing cost pressure and demands for product innovation and speed-to-market.
As a result, we must locate and secure production capacity. We depend on contract manufacturers to maintain adequate financial resources, including access to 26 Table of Contents sufficient credit, to secure a sufficient supply of raw materials, and maintain sufficient development and manufacturing capacity in an environment characterized by continuing cost pressure and demands for product innovation and speed-to-market.
Changes in foreign currency exchange rates also affect the relative prices at which we and competitors sell products in the same market. Foreign governmental policies and actions regarding currency valuation could result in actions by the United States and other countries to offset the effects of such fluctuations.
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, by other countries and the United States to offset the effects of such fluctuations.
Any failures of these vendors to properly deliver their services could similarly have a material effect on our business. We may outsource other functions in the future, which would increase our reliance on third parties. 25 Table of Contents We currently rely on contract manufacturing of our products.
Any failures of these vendors to properly deliver their services could similarly have a material effect on our business. We may outsource other functions in the future, which would increase our reliance on third parties. We currently rely on contract manufacturing of our products.
The unpredictability and volatility of foreign currency exchange rates has adversely impacted our businesses and financial results and ongoing or unusual volatility may continue to adversely impact us.
The unpredictability and volatility of foreign currency exchange rates has adversely impacted our businesses and financial results in the past and ongoing or unusual volatility may continue to adversely impact us.
We have been and may continue to be subject to costs associated with regulations, including for the diligence pertaining to these matters and the cost of remediation and other changes to products, processes, or sources of supply as a consequence of 26 Table of Contents such verification activities.
We have been and may continue to be subject to costs associated with regulations, including for the diligence pertaining to these matters and the cost of remediation and other changes to products, processes, or sources of supply as a consequence of such verification activities.
Plan liabilities may impair our liquidity, have an unfavorable impact on our ability to obtain financing and place us at a competitive disadvantage compared to some of our competitors who do not have such 28 Table of Contents liabilities and cash requirements. See Note 10 to the consolidated financial statements for more information regarding these obligations.
Plan liabilities may impair our liquidity, have an unfavorable impact on our ability to obtain financing and place us at a competitive disadvantage compared to some of our competitors who do not have such 29 Table of Contents liabilities and cash requirements. See Note 8 to the consolidated financial statements for more information regarding these obligations.
The techniques used to obtain unauthorized, improper or illegal access to our systems, our data or our customers’ data, to disable or degrade service or to sabotage systems are constantly evolving, have become increasingly complex and sophisticated, may be difficult to detect quickly and often are not recognized until launched against a target, even if we take all reasonable precautions, including to the extent required by law.
The techniques used to obtain unauthorized, improper or illegal access to our systems, our data or our customers’ data, to disable or degrade service or to sabotage systems, including through the use of artificial intelligence, are constantly evolving, have become increasingly complex and sophisticated, may be difficult to detect quickly and often are not recognized until launched against a target, even if we take all reasonable precautions, including to the extent required by law.
If these policies, materials or statements are found to be 31 Table of Contents deficient, lacking in transparency, deceptive, unfair or misrepresentative of our practices, we may be subject to investigation, enforcement actions by regulators or other adverse consequences.
If these policies, materials or statements are found to be deficient, lacking in transparency, deceptive, unfair or misrepresentative of our practices, we may be subject to investigation, enforcement actions by regulators or other adverse consequences.
Furthermore, we are bound by contractual obligations related to privacy, data protection and data security, and our efforts to comply with such obligations may not be successful or may have other negative consequences. We may publish privacy policies, marketing materials and other statements, such as compliance with certain certifications or self-regulatory principles, regarding data privacy and security.
Furthermore, we are bound by contractual obligations related to privacy, data protection and data security, and our efforts to comply with such obligations may not be successful or may have other negative consequences. 32 Table of Contents We may publish privacy policies, marketing materials and other statements, such as compliance with certain certifications or self-regulatory principles, regarding data privacy and security.
We could face increased costs or disruption associated with finding replacement vendors or hiring new employees in order to return these services in-house, which may have a significant impact on our costs, as well as impact the timing of receipt of inventory for future seasons.
We could face increased costs or disruption associated with finding replacement vendors or hiring new employees in order to return these services in-house, which may have a significant impact on our costs, as well as impact the timing of receipt of inventory for future seasons and the shipment of inventory to consumers and customers.
Furthermore, other comprehensive privacy laws, such as China’s Personal Information Protection Law, Canada’s Personal Information Protection and Electronic Documents Act and India’s new Digital Personal Data Protection Act, as well as other states in the United States, such as Virginia, Colorado, Connecticut, Utah and others, have enacted data privacy laws that have come into effect or will come into effect in the coming months and years, which are likely to continue to influence other jurisdictions, U.S. states or even the U.S.
Furthermore, other comprehensive privacy laws, such as China’s Personal Information Protection Law, Canada’s Personal Information Protection and Electronic Documents Act and India’s new Digital Personal Data Protection Act, as well as other states in the United States have enacted data privacy laws that have come into effect or will come into effect in the coming months and years, which are likely to continue to influence other jurisdictions, U.S. states or even the U.S.
A future pandemic, including the emergence of new COVID-19 variants, poses 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.
Pandemics, including the emergence of new COVID-19 variants, poses 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.
Maintaining, promoting and positioning our brands will depend largely on the success of our marketing, design and merchandising efforts and our ability to 18 Table of Contents provide consistent, high-quality products supported by engaging marketing campaigns.
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.
Holders of more than 80% of our Class B common stock have contractual rights, subject to certain conditions, to require us to file registration statements for the public resale of the shares of Class A common stock issuable upon conversion of their Class B common stock, or to include such shares in registration statements that we may file.
A majority of holders of our Class B common stock have contractual rights, subject to certain conditions, to require us to file registration statements for the public resale of the shares of Class A common stock issuable upon conversion of their Class B common stock, or to include such shares in registration statements that we may file.
Consolidation in the retail industry has typically resulted in store closures, centralized purchasing decisions and increased emphasis by retailers on inventory management and productivity, which could result in 21 Table of Contents fewer stores carrying our products or reduced demand by retailers for our products.
Consolidation in the retail industry has typically resulted in store closures, centralized purchasing decisions and increased emphasis by retailers on inventory management and productivity, which could result in fewer stores carrying our products or reduced demand by retailers for our products.
Our inability to secure production sources meeting our quality, cost, social and environmental risk mitigation and other requirements, or failures by our contract manufacturers to perform, could harm our sales, service levels and reputation In fiscal year 2023, we sourced approximately 99% of our products from independent contract manufacturers that purchase fabric and make our products and may also provide us with design and development services.
Our inability to secure production sources meeting our quality, cost, social and environmental risk mitigation and other requirements, or failures by our contract manufacturers to perform, could harm our sales, service levels and reputation In fiscal year 2024, we sourced nearly all of our products from independent contract manufacturers that purchase fabric and make our products and may also provide us with design and development services.
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 delays or issues encountered in these activities could have an adverse effect on the financial condition of the company.
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.
As a result, we are both directly and indirectly (through our suppliers) subject to the risks of doing business outside the United States, including: • currency fluctuations, which have impacted our results of operations significantly in recent years, including fiscal year 2022; • political, economic and social instability; • changes in tariffs and taxes; • inflationary pressures; • regulatory restrictions on our ability to operate in our preferred manner; • rapidly changing regulatory restrictions and requirements, including in the areas of data privacy, sustainability and responses to climate change, which could result in regulatory uncertainty as well as potential significant increases in compliance costs; and • less protective foreign laws relating to intellectual property.
As a result, we are both directly and indirectly (through our suppliers) subject to the risks of doing business outside the United States, including: • currency fluctuations, which have impacted our results of operations significantly in prior years; • political, economic and social instability; • changes in tariffs, tax laws and global trade policies; • inflationary pressures; • regulatory restrictions on our ability to operate in our preferred manner; • rapidly changing regulatory restrictions and requirements, including in the areas of data privacy, sustainability and responses to climate change, which could result in regulatory uncertainty as well as potential significant increases in compliance costs; and • less protective foreign laws relating to intellectual property.
Any unauthorized access of our or our service providers’ information technology systems or networks may result in the loss of confidential business and financial data, misappropriation of our consumers’, users’ or employees’ personal information or a disruption of our business.
Actual or perceived vulnerabilities or unauthorized access of our or our service providers’ information technology systems or networks may result in the loss of confidential business and financial data, misappropriation of our consumers’, users’ or employees’ personal information or a disruption of our business.
Treasury Department’s 2022 foreign tax credit regulations, make significant changes to the U.S. tax regime and could materially impact how our earnings are taxed. In addition, the Organization for Economic Cooperation and Development (“OECD”) reached agreement among various countries to implement a minimum 15% tax rate on certain multinational enterprises, commonly referred to as Pillar Two.
Treasury Department’s 2022 foreign tax credit regulations, make significant changes to the U.S. tax regime and could materially impact how our earnings are taxed. In addition, the Organization for Economic Cooperation and Development (“OECD”) reached agreement with over 140 countries to implement a minimum 15% tax rate on certain multinational enterprises, commonly referred to as the Pillar Two Inclusive Framework.
Any significant reduction in consumer visits to, or spending at, our and our customers’ stores caused, directly or indirectly, by COVID-19 or any other pandemic, and any continued decreased spending at stores or online caused by decreased consumer confidence and spending, would result in a loss of sales and profits and, as a result, adversely impact our financial results.
Any significant reduction in consumer visits to, or spending at, our and our customers’ stores caused, directly or indirectly, by pandemics, and any continued decreased spending at stores or online caused by decreased consumer confidence and spending, would result in a loss of sales and profits and, as a result, adversely impact our financial results.
Additionally, employees in various jurisdictions and countries in which we and our vendors operate are or may eventually become unionized, which could bring about increased payroll costs and reduced flexibility under labor regulations, which in turn may negatively impact our business.
Additionally, employees in various jurisdictions and countries in which we and our vendors operate are or may eventually become unionized, which could bring about changes to our culture and operating model, increased payroll costs and reduced flexibility under labor regulations, which in turn may negatively impact our business.
Other factors that could negatively affect our business, operations and financial performance in the future and prevent us, our employees, customers, vendors and manufacturers from conducting business activities for an indefinite period of time during a pandemic, epidemic, health crisis or any future outbreak of any highly infectious or contagious disease, include, but are not limited to: • government mandates, guidance or recommendations regarding future shutdowns or closure requirements; • other future operational restrictions and delays; • any recession or inflationary pressures, resulting directly or indirectly, from the pandemic; • delays in inventory orders and, in turn, delays in deliveries to our wholesale customers and a decrease in availability in our company-operated stores and e-commerce sites; • a decrease in productivity or other disruptions in our business due to our hybrid work from home policy; • an increased reliance by those working offsite on residential communication networks and internet providers, which may be more susceptible to service interruptions and cyberattacks and, thus, could result in an increase in phishing and other scams, fraud, money laundering, theft and other criminal activity; • a disruption, including a worker shortage, in or the temporary or permanent closing of the factories that manufacture our products, the distribution centers where we manage our inventory or the operations of our logistics and other service providers; • a decrease in available raw materials; • carrier constraints due to an increase in digital sales; • a future decision by management to restrict operations or close stores to protect the health and safety of our employees, consumers and communities; • other threats to the health of our employees; • an increase in health care costs, resulting directly or indirectly, from the pandemic; and • negative general macroeconomic conditions.
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. 17 Table of Contents Other factors that could negatively affect our business, operations and financial performance in the future and prevent us, our employees, customers, vendors and manufacturers from conducting business activities for an indefinite period of time during a pandemic, epidemic, health crisis or any future outbreak of any highly infectious or contagious disease, include, but are not limited to: • government mandates, guidance or recommendations regarding future shutdowns or closure requirements; • other future operational restrictions and delays; • any recession or inflationary pressures, resulting directly or indirectly, from the pandemic; • delays in inventory orders and, in turn, delays in deliveries to our wholesale customers and a decrease in availability in our company-operated stores and e-commerce sites; • a decrease in productivity or other disruptions in our business due to our hybrid work from home policy; • an increased reliance by those working offsite on residential communication networks and internet providers, which may be more susceptible to service interruptions and cyberattacks and, thus, could result in an increase in phishing and other scams, fraud, money laundering, theft and other criminal activity; • a disruption, including a worker shortage, in or the temporary or permanent closing of the factories that manufacture our products, the ports and distribution centers where we manage our inventory or the operations of our logistics and other service providers; • a decrease in available raw materials; • carrier constraints due to an increase in digital sales; • a future decision by management to restrict operations or close stores to protect the health and safety of our employees, consumers and communities; • other threats to the health of our employees; • an increase in health care costs, resulting directly or indirectly, from the pandemic; and • negative general macroeconomic conditions.
Restructuring program actions, which include a reduction in workforce, operating model redesign and core processes redesign, may present a number of significant risks that could have a material adverse effect on our operations, financial condition, results of operations, cash flow, or business reputation, including: • incurrence of additional costs in the short-term, including workforce reduction costs, training of employees or third-party resources, accounting charges for inventory and technology-related write-offs and charges relating to consolidation of excess facilities; • failure to accurately assess market opportunities and the technology required to address such opportunities; • actual or perceived disruption of service or reduction in service levels to customers and consumers; • potential adverse effects on our internal control environment and inability to preserve adequate internal controls relating to our general and administrative functions; • actual or perceived disruption to customers, suppliers, distribution networks and other important operational relationships and the inability to resolve potential conflicts in a timely manner; • difficulty in obtaining timely delivery of products of acceptable quality from our contract manufacturers; • diversion of management attention from ongoing business activities and strategic objectives; • failure to maintain employee morale and retain key employees, damage to company culture and an increase in employment claims; and • damage to our reputation as an employer, which could make it more difficult for us to hire new employees in the future.
Restructuring program actions, which include a reduction in workforce, operating model redesign and core processes redesign, may present a number of significant risks that could have a material adverse effect on our operations, financial condition, results of operations, cash flow, or business reputation, including: 23 Table of Contents • incurrence of additional costs in the short-term, including workforce reduction costs, costs associated with transitioning functions to new locations, training of employees or third-party resources, accounting charges for inventory and technology-related write-offs and charges relating to consolidation of excess facilities; • failure to accurately assess market opportunities and the technology required to address such opportunities; • failure to accurately predict the time and resources necessary to implement our restructuring plan and related go-to-market strategy; • actual or perceived disruption of service or reduction in service levels to customers and consumers; • potential adverse effects on our internal control environment and inability to preserve adequate internal controls relating to our general and administrative functions; • actual or perceived disruption to customers, suppliers, distribution networks and other important operational relationships and the inability to resolve potential conflicts in a timely manner; • difficulty in obtaining timely delivery of products of acceptable quality from our contract manufacturers; • diversion of management attention from ongoing business activities and strategic objectives; • failure to maintain employee morale, damage to company culture and an increase in employment claims; • employee attrition beyond planned reductions and workforce transitions, including inadequate transfers of knowledge; and • damage to our reputation as an employer, which could make it more difficult for us to hire new employees in the future.
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), labor disputes, worker shortages, pandemics (such as the COVID-19 pandemic), macroeconomic conditions, geopolitical conflict, the impacts of climate change, earthquakes, floods, fires or other natural disasters affecting these distribution centers or shipping channels.
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), 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.
In addition, the increased use of employee-owned devices for communications, as well as work-from-home arrangements, present additional operational risks to our information technology systems, including, but not limited to, increased risks of cyber-attacks.
In addition, the increased use of employee-owned devices for communications, as well as work-from-home arrangements, present additional operational risks to our information technology systems.
Our ability to effectively manage and maintain our inventory and to ship products to customers on a timely basis depends significantly on the reliability of these systems, and we cannot assure that implementing these modifications and upgrades will in the future prevent or protect against all technological problems and security issues or bring about the desired efficiencies and synergies to our operations.
Our ability to effectively manage and maintain our inventory and to ship products to customers on a timely basis, either directly or through our third-party providers, depends significantly on the reliability of their and our technology systems, and we cannot assure that implementing these modifications and upgrades will 24 Table of Contents in the future prevent or protect against all technological problems and security issues or bring about the desired efficiencies and synergies to our operations.
As of November 26, 2023, we had $1.0 billion of unsecured debt. Additionally, we had $942.8 million of borrowing capacity under the Credit Facility. The Credit Facility is secured by domestic and Canadian inventories, accounts receivable, and other assets, such as the Levi’s ® trademarks in the U.S.
As of December 1, 2024, we had $1.0 billion of unsecured debt. Additionally, we had $803.0 million of borrowing capacity under the Credit Facility. The Credit Facility is secured by domestic and Canadian inventories, accounts receivable, and other assets, such as the Levi’s ® trademarks in the U.S.
Changes in our credit ratings or macroeconomic conditions may affect our liquidity, increasing borrowing costs and limiting our financing options. Our long-term debt is currently rated BB+ by S&P Global Ratings, Ba1 by Moody’s Investors Service, Inc and BB+ by Fitch Ratings, Inc.
Changes in our credit ratings or macroeconomic conditions may affect our liquidity, increasing borrowing costs and limiting our financing options. As of December 1, 2024, our long-term debt was rated BB+ by S&P Global Ratings, Ba1 by Moody’s Investors Service, Inc and BB+ by Fitch Ratings, Inc.
As a result, our success depends in large part on our ability to develop, market and deliver innovative and stylish products at a pace, intensity and price competitive with other brands in the markets in which we sell our products.
As a result, our success depends in large part on our ability to efficiently and effectively develop, market and deliver innovative and stylish products at a pace, intensity and price competitive with other brands in the markets in which we sell our products while reducing costs associated with the related processes.
These information technology systems are critical to many of our operating activities and our business processes and may be negatively impacted by any security incident, service interruption or shutdown.
These information technology systems are critical to many of our operating activities and our business processes and may be negatively impacted by any security incident, service interruption or shutdown. For example, in 2024, CrowdStrike Holdings, Inc.
Dollar relative to major foreign currencies, including the Euro and British Pound, unfavorably impacted our fiscal year 2023 results. Continued significant fluctuations of foreign currencies against 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.
In addition, the physical changes prompted by climate change could result in changes in regulations, consumer preferences, production capabilities, availability of raw materials and costs, which could in turn affect our business, operating results, and financial condition.
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 are also a party to a Second Amended and Restated Credit Agreement (as amended to date, the “Credit Agreement”) with several financial institutions that provides us with a senior secured revolving credit facility (the “Credit Facility”) under which we had $942.8 million of borrowing capacity as of November 26, 2023.
We are also a party to a Second Amended and Restated Credit Agreement (as amended to date, the “Credit Agreement”) with several financial institutions that provides us with a senior secured revolving credit facility (the “Credit Facility”) under which we had $803.0 million of borrowing capacity as of December 1, 2024.
Adverse publicity, regardless of its accuracy, could undermine consumer confidence in our brands and reduce long-term demand for our products. 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.
Adverse publicity, regardless of its accuracy, could undermine consumer confidence in our brands and reduce long-term demand for our products. 18 Table of Contents In addition, actions taken or statements made by recipients of such charitable donations could also seriously harm our brand image with consumers.
The conflict has caused and may continue to cause adverse global economic conditions resulting from escalating geopolitical tensions, the exclusion of Russian financial institutions from the global banking system, volatility and fluctuations in foreign currency exchange rates and interest rates, inflationary pressures, supply chain and logistics disruptions and heightened cybersecurity threats.
The conflicts have caused and may continue to cause adverse global economic conditions resulting from escalating geopolitical tensions, the exclusion of certain financial institutions from the global banking system, volatility and fluctuations in foreign currency exchange rates and interest rates, inflationary pressures, supply chain and logistics disruptions, such as shipping disruptions in the Red Sea and surrounding waterways, and heightened cybersecurity threats.
These initiatives involve significant investments in IT systems, data science and artificial intelligence initiatives, and significant operational changes. Our competitors are also investing in omni-channel initiatives, some of which may be more successful than our initiatives.
In addition, our investments in consumer, digital, and omni-channel shopping initiatives may not deliver the results we anticipate. These initiatives involve significant investments in IT systems, data science and artificial intelligence initiatives, and significant operational changes. Our competitors are also investing in omni-channel initiatives, some of which may be more successful than our initiatives.
If our contract manufacturers, or any raw material vendors or suppliers on which our contract manufacturers rely, suffer prolonged manufacturing or transportation disruptions due to macroeconomic conditions, geopolitical conflict, public health conditions, such as the recent COVID-19 pandemic, or other unforeseen events, our ability to source product on a timely basis could be adversely impacted, which could adversely affect our results of operations.
If our contract manufacturers, or any raw material vendors or suppliers on which our contract manufacturers rely, suffer permanent or prolonged manufacturing or transportation disruptions, including due to macroeconomic conditions, regulatory restrictions, geopolitical conflict, public health conditions, natural disasters, shortages of single-source or other raw materials, or any other unforeseen events, our ability to source product on a timely basis could be adversely impacted, which could adversely affect our results of operations.
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. Failure to continue to obtain or maintain high-quality endorsers of our products, or actions taken by our endorsers, could harm our business.
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.
Although our operations in Russia were not significant, the conflict has resulted in broader economic and security concerns, including in other geographies, which has adversely affected and may continue to adversely affect our business, financial condition or results of operations.
Although our operations in Russia and the Middle East were and are not significant, the conflicts have resulted in broader economic and security concerns, including in other geographies, which has adversely affected and may continue to adversely affect our business, financial condition or results of operations. The functional currency for most of our foreign operations is the applicable local currency.
In addition, we must create products at a range of price points that appeal to the consumers of both our wholesale customers and our dedicated retail stores and e-commerce sites situated in each of our diverse geographic regions.
In addition, we must create products at a range of price points that appeal to the consumers of both our wholesale customers and our dedicated retail stores and e-commerce sites situated in each of our diverse geographic regions. Our development and production cycles take place prior to full visibility into all of these factors for the coming seasons.
We have been and will continue to be a 23 Table of Contents target of cyber-attacks because of the visibility of our brand, making the secure maintenance of proprietary, confidential and sensitive data critical to our business and reputation.
We have been and will continue to be a target of cyber-attacks, including phishing, and other attempts to breach, or gain unauthorized access to, our systems because of the visibility of our brand, making the secure maintenance of proprietary, confidential and sensitive data critical to our business and reputation.
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. Our efforts to expand our retail business may not be successful, which could impact our operating results.
In addition, store closures, decreased foot traffic, 20 Table of Contents 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.
The prices we pay our suppliers for our products are dependent in part on the market price for raw materials used to produce them, primarily cotton.
The majority of our products are made of cotton, where the remaining balance are primarily made of synthetics, cotton/synthetic blends and viscose. The prices we pay our suppliers for our products are dependent in part on the market price for raw materials used to produce them, primarily cotton.
As we outsource functions, we become more dependent on the entities performing those functions. Disruptions or delays at our third-party service providers could adversely impact our operations As part of our long-term profitable growth strategy, we are continually looking for opportunities to provide essential business services in a more cost-effective manner.
Disruptions or delays at our third-party service providers could adversely impact our operations As part of our long-term profitable growth strategy, we are continually looking for opportunities to provide essential business services in a more cost-effective manner. In some cases, this requires the outsourcing of functions or parts of functions that can be performed more effectively by external service providers.
As of November 26, 2023, there were 8,760,936 shares of Class A common stock and 1,345,277 shares of Class B common stock issuable pursuant to restricted stock units ("RSUs"), performance restricted stock units ("PRSUs") and stock appreciation rights ("SARs") that may be settled in shares of our Class A or Class B common stock.
As of December 1, 2024, there were 9,066,809 shares of Class A common stock and 509,342 shares of Class B common stock issuable pursuant to restricted stock units ("RSUs"), performance restricted stock units ("PRSUs") and stock appreciation rights ("SARs") that may be settled in shares of our Class A or Class B common stock.
Dollar may further negatively impact our financial results, revenue, operating margins and net income. • Continued volatility in the availability and prices for commodities and raw materials we use in our products and in our supply chain (such as cotton) could have a material adverse effect on our costs, gross margins and profitability. • 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. • If retailers of our products experience severe financial difficulty, some may become insolvent and cease business operations, which could negatively impact the sale of our products to consumers.
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. • If retailers of our products experience severe financial difficulty, some may become insolvent and cease business operations, which could negatively impact the sale of our products to consumers.
For example, over the next several years, we plan to continue the process of implementing a new ERP system across the company with implementation in the United States completed in 2023 and Europe scheduled for fiscal year 2025. Additionally, we are building new distribution and fulfillment facilities which are highly automated and utilize industry leading technology and equipment.
For example, over the next several years, we plan to continue the process of implementing a new ERP system across the company with implementation in the United States completed in 2023 and Europe scheduled to commence in fiscal year 2026. Additionally, we are in the process of transitioning certain of our global distribution and fulfillment facilities to third-party providers.
We establish relationships with artists, designers, musicians, athletes and other public figures to develop, evaluate and promote our products. If we are unable to recruit endorsers with consumer appeal or endorsers were to stop using our products contrary to their endorsement agreements, our business could be adversely affected.
If we are unable to recruit endorsers with consumer appeal or endorsers were to stop using our products contrary to their endorsement agreements, our business could be adversely affected.
Changes to trade policy, including tariff and customs regulations, or failure to comply with such regulations may have an adverse effect on our reputation, business, financial condition and results of operations.
Any current or future legal or regulatory proceedings could divert management’s attention from our operations and result in substantial legal fees. Changes to trade policy, including tariff and customs regulations, or failure to comply with such regulations may have an adverse effect on our reputation, business, financial condition and results of operations.
In addition, actions taken or statements made by our endorsers, associated with our products or brand or otherwise, could also seriously harm our brand image with consumers and, as a result, could have an adverse effect on our business.
In addition, actions taken, allegations of wrongdoing or statements made by our endorsers, associated with our products or brand or otherwise, that harm the reputations of those endorsers or our decisions to cease collaborating with certain endorsers in light of actions taken, allegations of 19 Table of Contents wrongdoing or statements made by them, could also seriously harm our brand image with consumers and, as a result, could have an adverse effect on our business.
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.
Sales to our top ten wholesale customers accounted for 26%, 28% and 31% of our total net revenues in fiscal years 2024, 2023 and 2022, 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.
We also may need to expend significant resources to protect against, respond to or redress problems caused by any unauthorized processing.
We also may need to expend significant resources to protect against, respond to or redress problems caused by any unauthorized processing. As we outsource functions, we become more dependent on the entities performing those functions.
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. For example, in the fourth quarter of fiscal 2021, we acquired Beyond Yoga ® , a premium athletic and lifestyle apparel brand.
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.
In addition, such incidents could result in unauthorized disclosure and misuse of material confidential information, including personal information. Extortion payments may alleviate the negative impact of a ransomware attack, but we may be unwilling or unable to make such payments due to, for example, applicable laws or regulations prohibiting such payments.
Extortion payments may alleviate the negative impact of a ransomware attack, but we may be unwilling or unable to make such payments due to, for example, applicable laws or regulations prohibiting such payments or beliefs that payment may not result in system restoration.
The appeal of our brands may also depend on the success of our ESG initiatives, which require company-wide coordination and alignment. We are working to manage risks and costs to us, our licensees and our supply chain of any effects of climate change as well as diminishing fossil fuel and water resources.
We are working to manage risks and costs to us, our licensees and our supply chain of any effects of climate change as well as diminishing fossil fuel and water resources.
In addition to traditional computer “hackers,” threat actors, personnel (such as through theft or misuse), sophisticated nation-states and nation-state supported actors and social-activist organizations now engage in attacks.
In addition to traditional computer “hackers,” threat actors, personnel (such as through theft or misuse), sophisticated nation-states and nation- 25 Table of Contents state supported actors and social-activist organizations now engage in attacks. Furthermore, our efforts to address undesirable activity on our platforms may also increase the risk of retaliatory attack.
These rulings and agreements expire from time to time and may be extended when certain conditions are met, or terminated if certain conditions are not met. We cannot guarantee that such rulings and agreements will be extended. Any changes in conditions may result in a loss of certainty in treatment, which may adversely impact our tax planning.
These rulings and agreements expire from time to time and may be extended when certain conditions are met, or terminated if certain conditions are not met. We cannot guarantee that such rulings and agreements will be extended or all conditions will continue to be satisfied.
The global apparel industry is subject to intense competition and cost and pricing pressure The apparel industry is characterized by low barriers to entry for both suppliers and marketers, global sourcing through suppliers located throughout the world, trade liberalization, continuing movement of product sourcing to lower cost countries, regular promotional activity, and the ongoing emergence of new competitors with widely varying strategies and resources.
Also, because our supply chain is complex, we may face regulatory challenges in complying with applicable sanctions and trade regulations and reputational challenges with our consumers and other stakeholders if we are unable to sufficiently verify the origins for the material used in the products we sell. 27 Table of Contents The global apparel industry is subject to intense competition and cost and pricing pressure The apparel industry is characterized by low barriers to entry for both suppliers and marketers, global sourcing through suppliers located throughout the world, trade liberalization, continuing movement of product sourcing to lower cost countries, regular promotional activity, and the ongoing emergence of new competitors with widely varying strategies and resources.

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Item 2. Properties

Properties — owned and leased real estate

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Biggest changeItem 2. PROPERTIES We conduct manufacturing, distribution and administrative activities in owned and leased facilities. As of November 26, 2023, we operated two manufacturing-related facilities abroad and 13 distribution centers around the world. We have renewal rights for most of our property leases.
Biggest changeItem 2. PROPERTIES We conduct manufacturing, distribution and administrative activities in owned and leased facilities. As of December 1, 2024, we operated two manufacturing-related facilities abroad and 14 distribution centers around the world. In addition, during fiscal year 2024, we entered into a lease agreement with a third-party logistics provider to operate a distribution center in Ohio.
Information about our principal operating properties in use as of November 26, 2023 is summarized in the following table : Location Primary Use Leased/Owned San Francisco, CA Design and Product Development Leased Erlanger, KY Distribution Leased Hebron, KY Distribution Owned Canton, MS Distribution Owned Henderson, NV Distribution Owned Etobicoke, Canada Distribution Owned Itapevi, Brazil Distribution Leased Cuautitlan, Mexico Distribution Leased Villa El Salvador, Peru Distribution Leased Pudahuel, Chile Distribution Leased Dorsten, Germany Distribution Leased Plock, Poland Manufacturing and Finishing Leased (1) Northhampton, U.K.
Information about our principal operating properties in use as of December 1, 2024 is summarized in the following table : 40 Table of Contents Location Primary Use Leased/Owned San Francisco, CA Design and Product Development Leased Erlanger, KY Distribution Leased Hebron, KY Distribution Owned Canton, MS Distribution Owned Henderson, NV Distribution Owned Etobicoke, Canada Distribution Owned Itapevi, Brazil Distribution Leased Cuautitlan, Mexico Distribution Leased Villa El Salvador, Peru Distribution Leased Pudahuel, Chile Distribution Leased Dorsten, Germany Distribution Leased Plock, Poland Manufacturing and Finishing Leased (1) Northhampton, U.K.
Distribution Leased Adelaide, Australia Distribution Leased Cape Town, South Africa Manufacturing, Finishing and Distribution Leased ______________ (1) Building and improvements are owned but subject to a ground lease. Our global headquarters is located in leased premises in San Francisco, California, and we have additional commercial support offices in Diegem, Belgium and Singapore.
Distribution Leased Colombus, OH Distribution Leased Itagui, Colombia Distribution Leased Cape Town, South Africa Manufacturing, Finishing and Distribution Leased ______________ (1) Building and improvements are owned but subject to a ground lease. Our global headquarters is located in leased premises in San Francisco, California, and we have additional commercial support offices in Diegem, Belgium and Singapore.
We anticipate that we will be able to extend these leases on terms satisfactory to us or, if necessary, locate substitute facilities on acceptable terms. We believe our facilities and equipment are in good condition and are suitable and adequate to meet our current requirements.
We have renewal rights for most of our property leases. We anticipate that we will be able to extend these leases on terms satisfactory to us or, if necessary, locate substitute facilities on acceptable terms. We believe our facilities and equipment are in good condition and are suitable and adequate to meet our current requirements.
Additionally, we had 97 Dockers ® retail and outlet stores in leased premises, and six Beyond Yoga ® retail stores.
Additionally, we had 106 Dockers ® retail and outlet stores in leased premises, and seven Beyond Yoga ® retail stores.
As of November 26, 2023, we leased 61 administrative and sales offices in 34 countries, as well as leased 11 warehouses in four countries. As of November 26, 2023, we had 1,069 company-operated Levi's retail and outlet stores in leased premises in 37 countries: 412 stores in the Americas, 291 stores in Europe and 366 stores in Asia.
As of December 1, 2024, we leased 65 administrative and sales offices in 35 countries, as well as leased 7 warehouses in three countries. As of December 1, 2024, we had 1,163 company-operated Levi's retail and outlet stores in leased premises in 39 countries: 458 stores in the Americas, 299 stores in Europe and 406 stores in Asia.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeWe do not believe any of these pending claims, complaints and legal proceedings will have a material impact on our financial condition, results of operations or cash flows.
Biggest changeWe do not believe any of these pending claims, complaints and legal proceedings will have a material impact on our financial condition, results of operations or cash flows. Item 4. MINE SAFETY DISCLOSURES Not applicable. 41 Table of Contents PART II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeThe following table assumes an investment of $100 (with reinvestment of all dividends) to have been made in our Class A common stock and in each index on March 21, 2019, the date our Class A common stock began trading on the NYSE, and indicates the cumulative total return to stockholders on our Class A common stock and the cumulative total return of each index at our fiscal year ends of November 24, 2019, November 29, 2020, November 28, 2021, November 27, 2022 and November 26, 2023: (in dollars) March 21, 2019 November 24, 2019 November 29, 2020 November 28, 2021 November 27, 2022 November 26, 2023 Levi Strauss & Co. $ 100.00 $ 76.40 $ 87.06 $ 124.82 $ 75.73 $ 74.66 S&P 500 $ 100.00 $ 114.49 $ 134.47 $ 172.02 $ 156.18 $ 177.79 S&P 500 Apparel, Accessories and Luxury Goods $ 100.00 $ 94.24 $ 89.99 $ 99.37 $ 60.55 $ 47.36 The information under “Cumulative Stock Performance Graph” is not deemed to be “soliciting material” or “filed” with the SEC or subject to Regulation 14A or 14C, or to the liabilities of Section 18 of the Exchange Act, and is not to be incorporated by reference in any filing of Levi Strauss & Co. under the Securities Act or the Exchange Act, whether made before or after the date of this Annual Report and irrespective of any general incorporation language in those filings. 41 Table of Contents Recent Sales of Unregistered Securities None.
Biggest change(in dollars) November 24, 2019 November 29, 2020 November 28, 2021 November 27, 2022 November 26, 2023 December 1, 2024 Levi Strauss & Co. $ 100.00 $ 113.96 $ 163.38 $ 99.13 $ 97.73 $ 113.97 S&P 500 $ 100.00 $ 117.46 $ 150.25 $ 136.41 $ 155.29 $ 207.92 S&P 500 Apparel, Accessories and Luxury Goods $ 100.00 $ 91.44 $ 103.01 $ 62.75 $ 51.04 $ 48.25 The information under “Cumulative Stock Performance Graph” is not deemed to be “soliciting material” or “filed” with the SEC or subject to Regulation 14A or 14C, or to the liabilities of Section 18 of the Exchange Act.
For more detailed information about these limitations, see Note 9 to our audited consolidated financial statements included in this report.
For more detailed information about these limitations, see Note 7 to our audited consolidated financial statements included in this report.
The share repurchase program may be effected through Rule 10b5-1 plans, open market purchases or privately negotiated transactions, each in compliance with Rule 10b-18 under the Exchange Act. The program may be suspended or discontinued at any time and does not have an expiration date. During the fourth quarter of 2023, there were no shares repurchased.
The share repurchase program may be effected through Rule 10b5-1 plans, open market purchases or privately negotiated transactions, each in compliance with Rule 10b-18 under the Exchange Act. The program may be suspended or discontinued at any time and does not have an expiration date.
Purchases of Equity Securities by the Issuer and Affiliated Purchasers Period Total number of shares purchased (1) Average price paid per share (2) Total number of shares purchased as part of publicly announced plans or programs Approximate maximum dollar value of shares that may yet be purchased under the plans or programs August 28, 2023 - October 1, 2023 — $ — — $ 680,434,314 October 2, 2023 - October 29, 2023 — $ — — $ 680,434,314 October 30, 2023 - November 26, 2023 — — — $ 680,434,314 Total — $ — — _________ (1) We maintain a share repurchase program authorized by the Board.
Purchases of Equity Securities by the Issuer and Affiliated Purchasers Period Total number of shares purchased (1) Average price paid per share (2) Total number of shares purchased as part of publicly announced plans or programs Approximate maximum dollar value of shares that may yet be purchased under the plans or programs August 26, 2024 - September 29, 2024 — $ — — $ 620,752,259 September 30, 2024 - October 27, 2024 1,577,232 19.22 1,577,232 590,436,523 October 28, 2024 - December 1, 2024 — — — 590,436,523 Total 1,577,232 $ 19.22 1,577,232 _________ (1) We maintain a share repurchase program authorized by the Board.
Our Class B common stock is neither listed nor publicly traded. Holders of Record As of January 19, 2024, there were 58 holders of record of our Class A common stock and 249 holders of record of our Class B common stock.
Our Class B common stock is neither listed nor publicly traded. Holders of Record As of January 23, 2025, there were 64 holders of record of our Class A common stock and 247 holders of record of our Class B common stock.
Securities Authorized for Issuance Under Equity Incentive Plans See Item 12, “Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters” for information regarding securities authorized for issuance. 40 Table of Contents Cumulative Stock Performance Graph The following graph compares the cumulative total return to stockholders on our Class A common stock relative to the cumulative total returns of the S&P 500, and the S&P 500 Apparel, Accessories and Luxury Goods.
Securities Authorized for Issuance Under Equity Incentive Plans See Item 12, “Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters” for information regarding securities authorized for issuance. 42 Table of Contents Cumulative Stock Performance Graph The following graph compares the percentage change in the cumulative total return on our Class A common stock relative to the cumulative total returns of the Standard & Poor’s (“S&P”) 500 Index, and the S&P 500 Apparel, Accessories and Luxury Goods Index for the five fiscal-year periods commencing on November 24, 2019 and ended December 1, 2024.
The comparisons are based on historical data and are not indicative of, nor intended to forecast, the future performance of our Class A common stock.
The graph assumes an initial investment of $100 in our Class A common stock and in each index on November 24, 2019, with all dividends reinvested. The comparisons are based on historical data and are not necessarily indicative of, nor intended to forecast, the future performance of our Class A common stock.
Share repurchase authority was $680.4 million as of January 19, 2024. (2) The average price paid per share excludes any broker commissions. Shares withheld related to the vesting or exercise of stock-based compensation awards are excluded from the disclosure.
Shares withheld related to the vesting or exercise of stock-based compensation awards are excluded from the disclosure.
Removed
An investment of $100 (with reinvestment of all dividends) is assumed to have been made in our Class A common stock and in each index on March 21, 2019, the date our Class A common stock began trading on the NYSE, and its relative performance is tracked through November 26, 2023.
Added
Such information shall not be deemed incorporated by reference in any filing of Levi Strauss & Co. under the Securities Act or the Exchange Act, whether made before or after the date of this Annual Report, irrespective of any general incorporation language in those filings, except as otherwise expressly set forth by specific reference in such filing. 43 Table of Contents Recent Sales of Unregistered Securities None.
Added
During the fourth quarter of 2024, we repurchased 1.6 million shares for $30.3 million, excluding any broker commissions. Such repurchases were made pursuant to the Company’s share repurchase program described above. Share repurchase authority was $590.4 million as of January 23, 2025. (2) The average price paid per share excludes any broker commissions.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeYear Ended November 26, 2023 November 27, 2022 % Increase (Decrease) (Dollars in millions) Total revenues As reported $ 6,179.0 $ 6,168.6 0.2 % Impact of foreign currency exchange rates — (0.7) * Constant-currency net revenues $ 6,179.0 $ 6,167.9 0.2 % Americas As reported $ 3,086.9 $ 3,187.4 (3.2) % Impact of foreign currency exchange rates — 33.5 * Constant-currency net revenues - Americas $ 3,086.9 $ 3,220.9 (4.2) % Europe As reported $ 1,579.5 $ 1,597.2 (1.1) % Impact of foreign currency exchange rates — 16.5 * Constant-currency net revenues - Europe $ 1,579.5 $ 1,613.7 (2.1) % Asia As reported $ 1,059.7 $ 952.1 11.3 % Impact of foreign currency exchange rates — (56.6) * Constant-currency net revenues - Asia $ 1,059.7 $ 895.5 18.3 % Other Brands As reported $ 452.9 $ 431.9 4.9 % Impact of foreign currency exchange rates — 5.8 * Constant-currency net revenues - Other Brands $ 452.9 $ 437.7 3.5 % _____________ * Not meaningful 67 Table of Contents Constant-Currency Adjusted EBIT and Constant-Currency Adjusted EBIT Margin: The table below sets forth the calculation of Adjusted EBIT and Adjusted EBIT margin on a constant-currency basis for each of the periods presented.
Biggest changeYear Ended December 1, 2024 November 26, 2023 % Increase (Decrease) (Dollars in millions) Total revenues As reported $ 6,355.3 $ 6,179.0 2.9 % Impact of foreign currency exchange rates — (47.2) Impact of 53rd week (84.5) — Net revenues from Denizen divestiture (33.2) (86.2) Net revenues from Footwear category divestiture (63.2) (61.3) Organic net revenues $ 6,174.4 $ 5,984.3 3.2 % Americas As reported $ 3,200.6 $ 3,086.9 3.7 % Impact of foreign currency exchange rates — (14.3) Impact of 53rd week (56.0) — Net revenues from Denizen divestiture (33.2) (86.2) Organic net revenues - Americas $ 3,111.4 $ 2,986.4 4.2 % Europe As reported $ 1,617.9 $ 1,579.5 2.4 % Impact of foreign currency exchange rates — 8.4 Impact of 53rd week (20.4) — Net revenues from Footwear category divestiture (63.2) (61.3) Organic net revenues - Europe $ 1,534.3 $ 1,526.6 0.5 % Asia As reported $ 1,082.4 $ 1,059.7 2.1 % Impact of foreign currency exchange rates — (37.0) Organic net revenues - Asia $ 1,082.4 $ 1,022.7 5.8 % Other Brands As reported $ 454.4 $ 452.9 0.3 % Impact of foreign currency exchange rates — (4.3) Impact of 53rd week (8.0) — Organic net revenues - Other Brands $ 446.4 $ 448.6 (0.5) % Dockers ® As reported $ 323.3 $ 336.9 (4.0) % Impact of foreign currency exchange rates — (4.3) Impact of 53rd week (6.1) — Organic net revenues - Dockers ® $ 317.2 $ 332.6 (4.6) % Beyond Yoga ® As reported $ 131.1 $ 116.0 13.0 % Impact of 53rd week (1.9) — Organic net revenues - Beyond Yoga ® $ 129.2 $ 116.0 11.4 % The table below sets forth the calculation of net revenues by channel on an organic net revenue basis for each of the periods presented. 69 Table of Contents Year Ended December 1, 2024 November 26, 2023 % Increase (Decrease) (Dollars in millions) Total net revenues As reported $ 6,355.3 $ 6,179.0 2.9 % Impact of foreign currency exchange rates — (47.2) Impact of 53rd week (84.5) — Net revenues from Denizen divestiture (33.2) (86.2) Net revenues from Footwear category divestiture (63.2) (61.3) Organic net revenues $ 6,174.4 $ 5,984.3 3.2 % Wholesale As reported $ 3,431.5 $ 3,550.9 (3.4) % Impact of foreign currency exchange rates — (18.9) Impact of 53rd week (45.8) — Net revenues from Denizen divestiture (33.2) (86.2) Net revenues from Footwear category divestiture (63.2) (61.3) Organic net revenues - Wholesale $ 3,289.3 $ 3,384.5 (2.8) % DTC As reported $ 2,923.8 $ 2,628.1 11.3 % Impact of foreign currency exchange rates — (28.3) Impact of 53rd week (38.7) — Organic net revenues - DTC $ 2,885.1 $ 2,599.8 11.0 % The table below sets forth the calculation of net revenues by brand on an organic net revenue basis for each of the periods presented. 70 Table of Contents Year Ended December 1, 2024 November 26, 2023 % Increase (Decrease) (Dollars in millions) Total Levi’s Brands net revenues As reported $ 5,900.9 $ 5,726.1 3.1 % Impact of foreign currency exchange rates — (42.9) Impact of 53rd week (76.5) — Net revenues from Denizen divestiture (33.2) (86.2) Net revenues from Footwear category divestiture (63.2) (61.3) Organic net revenues $ 5,728.0 $ 5,535.7 3.5 % Levi’s ® As reported $ 5,641.8 $ 5,403.4 4.4 % Impact of foreign currency exchange rates — (42.9) Impact of 53rd week (76.5) — Net revenues from Footwear category divestiture (63.2) (61.3) Organic net revenues - Levi’s ® $ 5,502.1 $ 5,299.2 3.8 % Levi Strauss Signature TM As reported $ 225.9 $ 236.5 (4.5) % Organic net revenues - Levi Strauss Signature TM $ 225.9 $ 236.5 (4.5) % Denizen ® As reported $ 33.2 $ 86.2 (61.5) % Net revenues from Denizen divestiture $ (33.2) $ (86.2) Organic net revenues - Denizen ® $ — $ — * _____________ * Not meaningful 71 Table of Contents Constant-Currency Adjusted EBIT and Constant-Currency Adjusted EBIT Margin: The table below sets forth the calculation of Adjusted EBIT and Adjusted EBIT margin on a constant-currency basis for each of the periods presented.
Short-term borrowings of $12.5 million at various foreign subsidiaries were expected to be either paid over the next 12 months or refinanced at the end of their applicable terms. Our long-term debt agreements contain customary covenants restricting our activities as well as those of our subsidiaries.
Short-term borrowings of $5.5 million at various foreign subsidiaries were expected to be either paid over the next 12 months or refinanced at the end of their applicable terms. Our long-term debt agreements contain customary covenants restricting our activities as well as those of our subsidiaries.
(3) For the year ended November 26, 2023, property, plant, equipment, right-of-use asset impairment, and early lease terminations, net primarily includes charges of $49.3 million related to the impairment of capitalized internal-use software as a result of the decision to discontinue certain technology projects, $14.3 million of impairment related to certain store assets, primarily in the U.S. and as the result of poor store performance, a $3.9 million gain on the early termination of store leases in Russia, and $3.7 million of impairment related to other discontinued projects.
For the year ended November 26, 2023, property, plant, equipment, right-of-use asset impairment, and early lease terminations, net primarily includes charges of $49.3 million related to the impairment of capitalized internal-use software as a result of the decision to discontinue certain technology projects, $14.3 million of impairment related to certain store assets, primarily in the U.S. and as the result of poor store performance, a $3.9 million gain on the early termination of store leases in Russia, and $3.7 million of impairment related to other discontinued projects.
(3) For the year ended November 26, 2023, property, plant, equipment, right-of-use asset impairment, and early lease terminations, net primarily includes charges of $49.3 million related to the impairment of capitalized internal-use software as a result of the decision to discontinue certain technology projects, $14.3 million of impairment related to certain store assets, primarily in the U.S. and as the result of poor store performance, a $3.9 million gain on the early termination of store leases in Russia, and $3.7 million of impairment related to other discontinued projects.
For the year ended November 26, 2023, property, plant, equipment, right-of-use asset impairment, and early lease terminations, net primarily includes charges of $49.3 million related to the impairment of capitalized internal-use software as a result of the decision to discontinue certain technology projects, $14.3 million of impairment related to certain store assets, primarily in the U.S. and as the result of poor store performance, $3.7 million of impairment charges related to other discontinued projects, net of a $3.9 million gain on the early termination of certain store leases in Russia.
(4) For the year ended November 26, 2023, goodwill and other intangible asset impairment charges includes impairment charges of $75.4 million related to Beyond Yoga ® reporting unit goodwill and $14.8 million related to the Beyond Yoga ® trademark.
For the year ended November 26, 2023, goodwill and other intangible asset impairment charges includes impairment charges of $75.4 million related to Beyond Yoga ® reporting unit goodwill and $14.8 million related to the Beyond Yoga ® trademark.
(3) For the year ended November 26, 2023, property, plant, equipment, right-of-use asset impairment, and early lease terminations, net primarily includes charges of $49.3 million related to the impairment of capitalized internal-use software as a result of the decision to discontinue certain technology projects, $14.3 million of impairment related to certain store assets, primarily in the U.S. and as the result of poor store performance, a $3.9 million gain on the early termination of store leases in Russia, and $3.7 million of impairment related to other discontinued projects.
For the year ended November 26, 2023, property, plant, equipment, right-of-use asset impairment, and early lease terminations, net primarily includes charges of $49.3 million related to the impairment of capitalized internal-use software as a result of the decision to discontinue certain technology projects, $14.3 million of impairment related to certain store assets, primarily in the U.S. and as the result of poor store performance, a $3.9 million gain on the early termination of store leases in Russia, and $3.7 million of impairment related to other discontinued projects.
(4) For the year ended November 26, 2023, goodwill and other intangible asset impairment charges includes impairment charges of $75.4 million related to Beyond Yoga ® reporting unit goodwill and $14.8 million related to the Beyond Yoga ® trademark.
For the year ended November 26, 2023, goodwill and other intangible asset impairment charges includes impairment charges of $75.4 million related to Beyond Yoga ® reporting unit goodwill and $14.8 million related to the Beyond Yoga ® trademark.
Several factors could impact the Beyond Yoga ® brand's ability to achieve expected future cash flows, including the success of retail store and international expansion, store and e-commerce productivity, the impact of promotional activity, continued economic volatility and potential operational challenges related to the macroeconomic factors and other strategic initiatives to drive increased profitability.
Several factors could impact the Beyond Yoga ® brand's ability to achieve expected future cash flows, including the success of retail store and international expansion, store and e-commerce productivity, the impact of promotional activity, continued economic volatility and potential operational challenges related to macroeconomic factors and other strategic initiatives to drive increased profitability.
Cash uses Our principal cash requirements include working capital, capital expenditures, payments of principal and interest on our debt, payments of taxes, contributions to our pension plans and payments for postretirement health benefit plans, payment of taxes resulting from net settlement of shares issued under our 2016 Equity Incentive Plan, as amended to date ("2016 Plan"), and our 2019 Equity Incentive Plan as amended to date (“2019 Plan”), and, if market conditions warrant, occasional investments in, or acquisitions of, business ventures in our line of business.
Cash uses Our principal cash requirements include working capital, capital expenditures, payments of principal and interest on our debt, payments of taxes, contributions to our pension plans and payments for postretirement health benefit plans, payment of taxes resulting from net settlement of shares issued under our 2016 Equity Incentive Plan, as amended to date ("2016 Plan"), and our 2019 Equity Incentive Plan as amended to date (“2019 Plan”), and, if market conditions warrant, occasional investments in, or acquisitions of, business ventures.
See “—Financial Information Presentation—Fiscal Year.” This Management’s Discussion and Analysis of Financial Condition and Results of Operations is designed to provide a reader of our financial statements with a narrative from the perspective of our management on our financial condition, results of operations, liquidity and certain other factors that may affect our future results.
See “Financial Information Presentation—Fiscal Year.” This Management’s Discussion and Analysis of Financial Condition and Results of Operations is designed to provide a reader of our financial statements with a narrative from the perspective of our management on our financial condition, results of operations, liquidity and certain other factors that may affect our future results.
Net income Adjusted EBITDA Adjusted EBIT excluding depreciation and amortization expense Net income margin Adjusted net income margin Adjusted net income as a percentage of net revenues Diluted earnings per share Adjusted diluted earnings per share Adjusted net income per weighted-average number of diluted common shares outstanding We believe Adjusted gross profit, Adjusted gross margin, Adjusted SG&A, Adjusted SG&A margin, Adjusted EBIT, Adjusted EBIT margin, Adjusted net income, Adjusted EBITDA, Adjusted net income margin and Adjusted diluted earnings per share are useful to investors because they help identify underlying trends in our business that could otherwise be masked by certain expenses that we include in calculating net income but that can vary from company to company depending on its financing, capital structure and the method by which its assets were acquired, and can also vary significantly from period to period.
Net income Adjusted EBITDA Adjusted EBIT excluding depreciation and amortization expense Net income margin Adjusted net income margin Adjusted net income as a percentage of net revenues Diluted earnings per share Adjusted diluted earnings per share Adjusted net income per weighted-average number of diluted common shares outstanding We believe Adjusted SG&A, Adjusted SG&A margin, Adjusted EBIT, Adjusted EBIT margin, Adjusted EBITDA, Adjusted net income, Adjusted net income margin and Adjusted diluted earnings per share are useful to investors because they help identify underlying trends in our business that could otherwise be masked by certain expenses that we include in calculating net income but that can vary from company to company depending on its financing, capital structure and the method by which its assets were acquired, and can also vary significantly from period to period.
Goodwill and other intangible asset impairment charges During the year ended November 26, 2023, we recognized impairment charges of $90.2 million related to the Beyond Yoga ® acquisition. The impairment charge is composed of a $75.4 million impairment of goodwill and a $14.8 million impairment of the trademark intangible asset.
During the year ended November 26, 2023, we recognized impairment charges of $90.2 million related to the Beyond Yoga ® acquisition. The impairment charge is composed of a $75.4 million impairment of goodwill and a $14.8 million impairment of the trademark intangible asset.
During the year ended November 26, 2023, we recognized impairment charges of $90.2 million related to the Beyond Yoga ® acquisition. The impairment charge is composed of a $75.4 million impairment in goodwill and a $14.8 million impairment in the trademark intangible asset.
During the year ended November 26, 2023, we recognized impairment charges of $90.2 million related to the Beyond Yoga ® acquisition. The impairment charge is composed of a $75.4 million impairment of goodwill and a $14.8 million impairment of the trademark intangible asset.
For more information on our calculation of Adjusted free cash flow, a non-GAAP financial measures, see “- Non-GAAP Financial Measures.” Future determinations regarding the declaration and payment of dividends, if any, will be at the discretion of our board of directors and will depend on then-existing conditions, including our results of operations, payout ratio, capital requirements, financial condition, prospects, contractual arrangements, any limitations on payment of dividends present in our current and future debt agreements and other factors that our board of directors may deem relevant.
For more information on our calculation of Adjusted free cash flow, a non-GAAP financial measure, see “Non-GAAP Financial Measures.” Future determinations regarding the declaration and payment of dividends, if any, will be at the discretion of our board of directors and will depend on then-existing conditions, including our results of operations, payout ratio, capital requirements, financial condition, prospects, contractual arrangements, any limitations on payment of dividends present in our current and future debt agreements and other factors that our board of directors may deem relevant.
We are presenting these non-GAAP financial measures to assist investors in seeing our financial performance from management’s view and because we believe they provide an additional tool for investors to use in comparing our core financial performance over multiple periods with other companies in our industry.
We are presenting these non-GAAP financial measures to assist investors in seeing our financial performance from management’s point of view and because we believe they provide an additional tool for investors to use in comparing our core financial performance over multiple periods with other companies in our industry.
Adjusted gross profit, Adjusted gross margin, Adjusted SG&A, Adjusted SG&A margin, Adjusted EBIT, Adjusted EBIT margin, Adjusted net income, Adjusted EBITDA, Adjusted net income margin and Adjusted diluted earnings per share have limitations as analytical tools and should not be considered in isolation or as a substitute for an analysis of our results prepared and presented in accordance with GAAP.
Adjusted SG&A, Adjusted SG&A margin, Adjusted EBIT, Adjusted EBIT margin, Adjusted EBITDA, Adjusted net income, Adjusted net income margin and Adjusted diluted earnings per share have limitations as analytical tools and should not be considered in isolation or as a substitute for an analysis of our results prepared and presented in accordance with GAAP.
(3) For the year ended November 26, 2023, restructuring and restructuring related charges, severance and other, net primarily relates to net restructuring charges of $20.3 million, other executive severance and separation charges of $9.5 million, consulting costs associated with our restructuring initiative of $5.0 million, costs associated with the wind-down of the Russia business, including severance of $3.8 million.
For the year ended November 26, 2023, restructuring related charges, severance and other, net primarily relates to certain executive severance and separation charges of $9.5 million, consulting costs associated with our restructuring initiative of $5.0 million, costs associated with the wind-down of the Russia business, including severance of $3.8 million.
(5) For the year ended November 26, 2023, restructuring and restructuring related charges, severance and other, net primarily relates to net restructuring charges of $20.3 million, other executive severance and separation charges of $9.5 million, consulting costs associated with our restructuring initiative of $5.0 million, costs associated with the wind-down of the Russia business, including severance of $3.8 million.
For the year ended November 26, 2023, restructuring related charges, severance and other, net primarily relates to certain executive severance and separation charges of $9.5 million, consulting costs associated with our restructuring initiative of $5.0 million, and costs associated with the wind-down of the Russia business, including severance of $3.8 million.
(5) For the year ended November 26, 2023, restructuring and restructuring related charges, severance and other, net primarily relates to net restructuring charges of $20.3 million, other executive severance and separation charges of $9.5 million, consulting costs associated with our restructuring initiative of $5.0 million, costs associated with the wind-down of the Russia business, including severance of $3.8 million.
For the year ended November 26, 2023, restructuring related charges, severance and other, net primarily relates to certain executive severance and separation charges of $9.5 million, consulting costs associated with our restructuring initiative of $5.0 million, and costs associated with the wind-down of the Russia business, including severance of $3.8 million.
The determination of sales allowances is considered a critical accounting estimate because significant judgement is required to estimate sales volume and demand. Actual allowances may differ from estimates due to changes in sales volume based on wholesale customer or consumer demand and changes in customer and product-specific circumstances. Inventory valuation.
The determination of sales allowances is considered a critical accounting estimate because significant judgment is required to estimate sales volume and demand. Actual allowances may differ from estimates due to changes in sales volume based on wholesale customer or consumer demand and changes in customer and product-specific circumstances. Inventory valuation.
Our constant-currency results do not eliminate the transaction currency impact, which primarily include the realized and unrealized gains and losses recognized from the measurement and remeasurement of purchases and sales of products in a currency other than the functional currency and of forward foreign exchange contracts.
Our constant-currency results do not eliminate the transaction currency impact, which primarily includes the realized and unrealized gains and losses recognized from the measurement and remeasurement of purchases and sales of products in a currency other than the functional currency and of forward foreign exchange contracts.
For further discussion of the methods used and factors considered in our estimates as part of the impairment testing for goodwill and intangible assets, see Note 1: Significant Accounting Policies - Goodwill and Intangible Assets. For further discussion of the impairment charges taken in 2023, see Note 5: Goodwill and Other Intangible Assets. Income tax.
For further discussion of the methods used and factors considered in our estimates as part of the impairment testing for goodwill and intangible assets, see Note 1: Significant Accounting Policies - Goodwill and Intangible Assets. For further discussion of the impairment charges taken in 2023, see Note 3: Goodwill and Other Intangible Assets. Income tax.
Other Factors Affecting Our Business We believe the other key business and marketplace factors that are impacting our business include the following: • Inflation and other macroeconomic pressures in the U.S. and the global economy such as rising interest rates, energy prices and recession fears are creating a complex and challenging retail environment for us and our customers as consumers reduce discretionary spending.
Other Factors Affecting Our Business We believe the other key business and marketplace factors that are impacting our business include the following: • Inflation and other macroeconomic pressures in the U.S. and the global economy such as rising interest rates, energy prices, potential new tariffs and recession fears are creating a complex and challenging retail environment for us and our customers as consumers reduce discretionary spending.
Due to the timing of our fiscal year end, a particular fiscal year might include one, two or no Black Fridays, which could impact our net revenues for the fiscal year. Fiscal years 2023 and 2022 included one Black Friday.
Due to the timing of our fiscal year end, a particular fiscal year might include one, two or no Black Fridays, which could impact our net revenues for the fiscal year. Fiscal years 2024 and 2023 included one Black Friday.
The increase in cash provided by operating activities in fiscal year 2023 is primarily driven by lower spending on inventory and employee incentives, partially offset by higher spending on SG&A expenses, and lower collections on trade receivables.
The increase in cash provided by operating activities in fiscal year 2024 is primarily driven by higher collections on trade receivables, lower spending on inventory and employee incentives, partially offset by higher spending on SG&A expenses.
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, Signature by Levi Strauss & Co.™ and Denizen ® brands.
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.
We may incur additional significant restructuring charges as we progress our global productivity initiative, which could be material in a future fiscal quarter or year.
We may incur additional significant restructuring and related charges as we progress our global productivity initiative, which could be material in a future fiscal quarter or year.
Constant-currency results have no standardized meaning prescribed by GAAP, are not prepared under any comprehensive set of accounting rules or principles and should be read in conjunction with our consolidated financial statements prepared in accordance with GAAP.
Organic net revenues and constant-currency results have no standardized meaning prescribed by GAAP, are not prepared under any comprehensive set of accounting rules or principles and should be read in conjunction with our consolidated financial statements prepared in accordance with GAAP.
Our key long-term objectives are to strengthen our brands globally in order to deliver sustainable profitable growth and generate industry-leading shareholder returns. Critical strategies to achieve these objectives include being a brand-led business, putting DTC first, and further diversifying across geographies, categories, genders and channels.
Our key long-term objectives are to strengthen our brands globally in order to deliver sustainable profitable growth and generate industry-leading shareholder returns. Critical strategies to achieve these objectives include being a brand-led business, putting DTC first, and further powering the portfolio by diversifying across geographies, categories, genders and channels.
Net sales include sales of products to wholesale customers, including franchised stores, and direct sales to consumers at our company-operated stores and shop-in-shops located within department stores and other third-party locations, as well as company-operated e-commerce sites. Net revenues include discounts, allowances for estimated returns and incentives.
Net sales include sales of products to wholesale customers, including franchised stores, and direct sales to consumers at our company-operated stores and shop-in-shops located within department stores and other third-party locations, as well as company-operated e-commerce sites. Net revenues are recorded net of discounts, allowances for estimated returns and retailer promotions and other incentives.
We classify interest and penalties related to income taxes as income tax expense. 70 Table of Contents Recently Issued Accounting Standards See Note 1 to our audited consolidated financial statements included in this report for recently issued accounting standards, including the expected dates of adoption and expected impact to our consolidated financial statements upon adoption. 71 Table of Contents
We classify interest and penalties related to income taxes as income tax expense. 75 Table of Contents Recently Issued Accounting Standards See Note 1 to our audited consolidated financial statements included in this report for recently issued accounting standards, including the expected dates of adoption and expected impact to our consolidated financial statements upon adoption. 76 Table of Contents
A discussion regarding our results of operations for fiscal year 2022 compared to fiscal year 2021 can be found under Item 7 – Management’s Discussion and Analysis in our Annual Report on Form 10-K for the year ended November 27, 2022, filed with the SEC on January 25, 2023.
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 November 26, 2023, filed with the SEC on January 25, 2024.
In addition, we regularly evaluate our ability to pay dividends or repurchase stock, all consistent with the terms of our debt agreements. On May 31, 2022, our board of directors approved a new share repurchase program that authorizes the repurchase of up to $750 million of our Class A common stock.
In addition, we regularly evaluate our ability to pay dividends or repurchase stock, all consistent with the terms of our debt agreements. 58 Table of Contents On May 31, 2022, our board of directors approved a share repurchase program that authorizes the repurchase of up to $750 million of our Class A common stock.
We also sell our products directly to consumers through a variety of formats, including our own company-operated mainline and outlet stores, company- 43 Table of Contents operated e-commerce sites and select shop-in-shops that we operate within department stores and other third-party retail locations.
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.
Refer to Note 18 for more information on the effective tax rate. 63 Table of Contents Adjusted Diluted Earnings per Share: The following table presents a reconciliation of diluted earnings per share, the most directly comparable financial measure calculated in accordance with GAAP, to Adjusted diluted earnings per share for each of the periods presented.
Refer to Note 17 for more information on the effective tax rate. 65 Table of Contents Adjusted Diluted Earnings per Share: The following table presents a reconciliation of diluted earnings per share, the most directly comparable financial measure calculated in accordance with GAAP, to Adjusted diluted earnings per share for each of the periods presented.
In fiscal year 2022, our net revenues in the first, second, third and fourth quarters represented 26%, 24%, 24% and 26%, respectively, of our total net revenues for the year. We typically achieve a significant amount of revenues from our DTC channel on the Friday following Thanksgiving Day, which is commonly referred to as Black Friday.
In fiscal year 2023, our net revenues in the first, second, third and fourth quarters represented 27%, 22%, 24% and 27%, respectively, of our total net revenues for the fiscal year. We typically achieve a significant amount of revenues from our DTC channel on the Friday following Thanksgiving Day, which is commonly referred to as Black Friday.
(5) For the year ended November 26, 2023, restructuring and restructuring related charges, severance and other, net primarily relates to net restructuring charges of $20.3 million, other executive severance and separation charges of $9.5 million, consulting costs associated with our restructuring initiative of $5.0 million, costs associated with the wind-down of the Russia business, including severance of $3.8 million.
For the year ended November 26, 2023, restructuring related charges, severance and other, net primarily relates to certain executive severance and separation charges of $9.5 million, consulting costs 63 Table of Contents associated with our restructuring initiative of $5.0 million, and costs associated with the wind-down of the Russia business, including severance of $3.8 million.
On both a reported and constant-currency basis, cost of goods sold reflects the transactional currency impact resulting from the purchase of products in a currency other than the functional currency. • Selling 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 selling, general and administrative expenses, 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. 49 Table of Contents Results of Operations A discussion regarding our results of operations for fiscal year 2023 compared to fiscal year 2022 is presented below.
On both a reported and constant-currency basis, cost of goods sold reflects the transactional currency impact resulting from the purchase of products in a currency other than the functional currency. • 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, 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. 50 Table of Contents Results of Operations A discussion regarding our results of operations for fiscal year 2024 compared to fiscal year 2023 is presented below.
(6) Depreciation and amortization for the years ended November 26, 2023 and November 27, 2022 is net of $0.4 million and $0.3 million, respectively, of amortization included in Restructuring and restructuring related charges, severance and other, net. 62 Table of Contents Adjusted Net Income: The following table presents a reconciliation of net income, the most directly comparable financial measure calculated in accordance with GAAP, to Adjusted net income for each of the periods presented.
(6) Depreciation and amortization for the years ended December 1, 2024 and November 26, 2023 is net of $0.3 million and $0.4 million, respectively, of amortization included in restructuring related charges, severance and other, net. 64 Table of Contents Adjusted Net Income: The following table presents a reconciliation of net income, the most directly comparable financial measure calculated in accordance with GAAP, to Adjusted net income for each of the periods presented.
Based on the fair value of our capital stock and the number of shares outstanding as of November 26, 2023, future payments related to shares surrendered for employee tax withholding on the exercise or vesting of outstanding equity awards could range up to approximately $30 million, which could become payable in 2024.
Based on the fair value of our capital stock and the number of shares outstanding as of December 1, 2024, future payments related to shares surrendered for employee tax withholding on the exercise or vesting of outstanding equity awards could range up to approximately $30 million, which could become payable in 2025.
Across all of our brands, pants – including jeans, casual pants, dress pants, shorts, skirts, and activewear – represented 68% and 67% of our total units sold in fiscal years 2023 and 2022, respectively. Tops – including shirts, sweaters, jackets, dresses and jumpsuits – represented 26% of our total units sold in both fiscal year 2023 and fiscal year 2022.
Across all of our brands, pants – including jeans, casual pants, dress pants, shorts, skirts, and activewear – represented 67% and 68% of our total units sold in fiscal years 2024 and 2023, respectively. Tops – including shirts, sweaters, jackets, dresses and jumpsuits – represented 27% and 26% of our total units sold in fiscal years 2024 and 2023, respectively.
Our weighted-average interest rate on average borrowings outstanding for fiscal year 2023 was 4.20%, as compared to 3.96% for fiscal year 2022. Other (expense) income, net Other (expense) income, net, primarily consists of foreign exchange management activities and transactions.
Our weighted-average interest rate on average borrowings outstanding for fiscal year 2024 was 4.01%, as compared to 4.20% for fiscal year 2023. Other (expense) income, net Other (expense) income, net, primarily consists of foreign exchange management activities and transactions.
Today we design, market and sell products that include jeans, casual and dress pants, tops, shorts, skirts, dresses, jackets, footwear and related accessories for men, women and children around the world under our Levi’s ® , Dockers ® , Signature by Levi Strauss & Co.™ and Denizen ® brands.
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.
For fiscal 2023, we elected to perform a qualitative assessment for the goodwill in certain of our reporting units and 69 Table of Contents certain indefinite-lived intangible assets.
For fiscal 2024, we elected to perform a qualitative assessment for the goodwill in certain of our reporting units and 74 Table of Contents certain indefinite-lived intangible assets.
In January 2024, our board of directors declared a cash dividend of $0.12 per share to holders of record of its Class A and Class B common stock at the close of business on February 7, 2024, for a total quarterly dividend of approximately $48 million.
In January 2025, our board of directors declared a cash dividend of $0.13 per share to holders of record of its Class A and Class B common stock at the close of business on February 12, 2025, for a total quarterly dividend of approximately $51 million.
The previously approved $200 million share repurchase program was completed as of the end of the second quarter of 2022. During fiscal 2023, 0.5 million shares were repurchased for $8.1 million, plus broker's commissions, in the open market. During fiscal 2022, 8.7 million shares were repurchased for $172.9 million, plus broker's commissions, in the open market.
The previously approved $200 million share repurchase program was completed as of the end of the second quarter of 2022. During fiscal 2024, 4.8 million shares were repurchased for $90.0 million, plus broker's commissions, in the open market. During fiscal 2023, 0.5 million shares were repurchased for $8.1 million, plus broker's commissions, in the open market.
Products other than denim bottoms – which include tops, footwear and accessories and pants excluding jeans – represented 39% and 38% of our net revenues in fiscal years 2023 and 2022, respectively.
Products other than denim bottoms – which include tops, footwear and accessories and pants excluding jeans – represented 39% of our net revenues in both fiscal years 2024 and 2023.
Our Europe and Asia businesses, collectively, contributed 43% of our net revenues and 46% of our segment operating income in fiscal year 2023, as compared to 41% of our net revenues and 41% of our segment operating income in fiscal year 2022.
Our Europe and Asia businesses, collectively, contributed 42% 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.
Some of these limitations include: • Adjusted EBIT, Adjusted EBIT margin and Adjusted EBITDA do not reflect income tax payments that reduce cash available to us; 58 Table of Contents • Adjusted EBIT, Adjusted EBIT margin and Adjusted EBITDA do not reflect interest expense, or the cash requirements necessary to service interest or principal payments on our indebtedness, which reduces cash available to us; • Adjusted EBIT, Adjusted EBIT margin and Adjusted EBITDA exclude other income, which includes realized and unrealized gains and losses on our forward foreign exchange contracts and transaction gains and losses on our foreign exchange balances, although these items affect the amount and timing of cash available to us when these gains and losses are realized; • Adjusted net income, Adjusted net income margin and Adjusted diluted earnings per share exclude COVID-19 government subsidy gains, unrealized gains on marketable securities originating in prior years, and loss on early extinguishment of debt; • all of these non-GAAP financial measures exclude acquisition and integration charges, and restructuring and restructuring related charges, severance and other, net which can affect our current and future cash requirements; • all of these non-GAAP financial measures exclude certain other SG&A expense items, which include severance, transaction and deal related costs, including acquisition and integration costs which can affect our current and future cash requirements; • all of these non-GAAP financial measures exclude certain other SG&A expense items, which include non-cash property and equipment and right-of-use asset impairment charges.
Some of these limitations include: • Adjusted EBIT, Adjusted EBIT margin and Adjusted EBITDA do not reflect income tax payments that reduce cash available to us; • Adjusted EBIT, Adjusted EBIT margin and Adjusted EBITDA do not reflect interest expense, or the cash requirements necessary to service interest or principal payments on our indebtedness, which reduces cash available to us; • Adjusted EBIT, Adjusted EBIT margin and Adjusted EBITDA exclude other expense, net, which includes realized and unrealized gains and losses on our forward foreign exchange contracts and transaction gains and losses on our foreign exchange balances, although these items affect the amount and timing of cash available to us when these gains and losses are realized; 61 Table of Contents • all of these non-GAAP financial measures exclude acquisition and integration charges, impairment charges and early terminations and restructuring charges, net and restructuring related charges, severance and other, net which can affect our current and future cash requirements; • all of these non-GAAP financial measures exclude certain other SG&A expense items, which include severance, transaction and deal related costs, including acquisition and integration costs which can affect our current and future cash requirements; • all of these non-GAAP financial measures exclude certain other SG&A expense items, which include non-cash property and equipment and right-of-use asset impairment charges.
Based on the annual assessment in 2023, the carrying values of the reporting unit and the trademark intangible asset exceeded its estimated fair value, resulting in impairment charges being taken for the carrying values of the reporting unit and trademark intangible asset to approximate their respective approximate fair values.
Based on the annual assessment in 2024, the carrying values of the reporting unit, trademark intangible asset, and customer relationship intangible assets exceeded their estimated fair values, resulting in impairment charges being taken for the carrying values of the reporting unit, trademark intangible asset, and customer relationship intangible assets to approximate their respective approximate fair values.
We also had cash and cash equivalents totaling approximately $398.8 million resulting in a total liquidity position (unused availability and cash and cash equivalents) of approximately $1.3 billion. Of our $398.8 million in cash and cash equivalents, approximately $260.1 million was held by foreign subsidiaries.
We also had cash and cash equivalents totaling approximately $690.0 million resulting in a total liquidity position (unused availability and cash and cash equivalents) of approximately $1.5 billion. Of our $690.0 million in cash and cash equivalents, approximately $363.8 million was held by foreign subsidiaries.
The remainder of our products are footwear and accessories. Men's products generated 64% and 65% of our net revenues in fiscal years 2023 and 2022, respectively. Women's products generated 34% and 33% of our net revenues in fiscal years 2023 and 2022, respectively. The remainder of our products are non-gendered.
The remainder of our products are footwear and accessories. Men's products generated 63% and 64% of our net revenues in fiscal years 2024 and 2023, respectively. Women's products generated 36% and 34% of our net revenues in fiscal years 2024 and 2023, respectively. The remainder of our products are non-gendered.
Revenues from our international business, which includes our Europe and Asia segments, as well as Canada and Latin America from our Americas segment, represented 56% of our net revenues in fiscal year 2023, as compared to 53% in fiscal year 2022.
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 2024 and fiscal year 2023, respectively.
These factors contribute to a global market environment of intense competition, constant product innovation and continuing cost pressure, and combine with the continuing global economic conditions to create a challenging commercial and economic environment.
These factors contribute to a global market environment of intense competition, constant product innovation and continuing cost pressure, and combine with the continuing global economic conditions to create a challenging commercial and economic environment. We evaluate these factors as we develop and execute our strategies.
However, constant-currency results are non-GAAP financial measures and are not meant to be 66 Table of Contents considered in isolation or as a substitute for comparable measures prepared in accordance with GAAP.
However, organic net revenues and constant-currency results are non-GAAP financial measures and are not meant to be considered in isolation or as a substitute for comparable measures prepared in accordance with GAAP.
Sales of Levi’s ® brand products represented approximately 87% of our net revenues in both fiscal year 2023 and fiscal year 2022. Our wholesale channel generated 57% and 62% of our net revenues in fiscal years 2023 and 2022, respectively.
Sales of Levi’s ® brand products represented approximately 89% and 87% of our net revenues in fiscal year 2024 and 2023, respectively. Our wholesale channel generated 54% and 57% of our net revenues in fiscal years 2024 and 2023, respectively.
We expect that stakeholder expectations and actions with respect to ESG practices and social issues will continue to evolve rapidly, which may negatively impact our financial results, and which may necessitate additional resources to monitor, report on, and adjust our operations. • Wholesaler/retailer dynamics and wholesale channels remain challenged by mixed growth prospects due to increased competition from e-commerce shopping, pricing transparency enabled by the proliferation of online technologies, and vertically-integrated specialty stores.
We expect that stakeholder expectations and actions with respect to 47 Table of Contents ESG practices and social issues and regulatory requirements will continue to evolve rapidly, which may impact our reputation and financial results. • Wholesaler/retailer dynamics and wholesale channels remain challenged by mixed growth prospects due to increased competition from e-commerce shopping, pricing transparency enabled by the proliferation of online technologies, and vertically-integrated specialty stores.
Corporate expenses represent costs that management does not attribute to any of our operating segments. Included in corporate expenses are certain impairment charges, acquisition related charges and other corporate staff costs. Corporate expenses also include costs associated with our global inventory sourcing organization which are reported as a component of consolidated gross margin.
Included in corporate expenses are certain impairment charges, acquisition related charges and other corporate staff costs. Corporate expenses also include costs associated with our global inventory sourcing organization which are reported as a component of consolidated gross margin.
Such changes 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. • The OECD reached agreement among various countries to implement a minimum 15% tax rate on certain multinational enterprises, commonly referred to as Pillar Two.
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. • 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.
Our DTC channel generated 43% and 38% of our net revenues in fiscal years 2023 and 2022, respectively, with our company operated e-commerce business representing 20% and 19% of DTC channel net revenues and 9% and 7% of total net revenues in fiscal years 2023 and 2022, respectively.
Our DTC channel generated 46% and 43% of our net revenues in fiscal years 2024 and 2023, respectively, with our company operated e-commerce business representing 21% and 20% of DTC channel net revenues and 10% and 9% of total net revenues in fiscal years 2024 and 2023, respectively.
Compared to the fourth quarter of 2022, Adjusted diluted earnings per share of $0.44 increased from $0.34 mainly due to the increase in Adjusted net income described above. • Inventory.
Compared to the fourth quarter of 2023, diluted earnings per share of $0.46 increased from $0.32 due to higher net income described above. • Adjusted diluted earnings per share. Compared to the fourth quarter of 2023, Adjusted diluted earnings per share of $0.50 increased from $0.44 mainly due to the increase in Adjusted net income described above.
Currency translation favorably affected Adjusted diluted earnings per share by $0.05. 48 Table of Contents For more information on Adjusted gross margin, 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, and reconciliations of such measures to net income and diluted earnings per share, see “—Non-GAAP Financial Measures.” Financial Information Presentation Fiscal year .
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, and reconciliations of such measures to net income and diluted earnings per share, see “Non-GAAP Financial Measures.” 49 Table of Contents Financial Information Presentation Fiscal year .
We believe disclosure of constant-currency results is helpful to investors because it facilitates period-to-period comparisons of our results by increasing the transparency of our underlying performance by excluding the impact of fluctuating foreign currency exchange rates.
We believe disclosure of organic net revenues and Adjusted EBIT constant-currency, Adjusted EBIT Margin constant-currency and Adjusted Net Income constant-currency results is helpful to investors because it facilitates period-to-period 67 Table of Contents comparisons of our results by increasing the transparency of our underlying performance by excluding the impact of fluctuating foreign currency exchange rates.
This will be a two-year initiative beginning in 2024, with a focus on optimizing our operating model and structure, redesigning business processes and identifying opportunities to reduce costs and simplify processes across our organization. In fiscal year 2024, we expect that this initiative will generate net cost savings of approximately $100 million.
This will be a two-year initiative beginning in 2024, with a focus on optimizing our operating model and structure, redesigning business processes and identifying opportunities to reduce costs and simplify processes across our organization.
Value brands, which are focused on the value-conscious consumer, generally generate lower gross margin. DTC sales generally have higher gross margins than sales through third parties, although DTC sales also typically have higher selling expenses. As we continue to execute on our strategic framework to be DTC first, we expect to see greater impact on our gross margins.
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. As we continue to execute on our strategic framework to be DTC first, we expect to see greater impact on our margins.
Net revenues in Asia increased on both reported and constant-currency bases, with currency translation affecting net revenues unfavorably by approximately $56 million. Excluding the effects of currency, net revenues for 2023 grew across both our wholesale and DTC channels.
Net revenues in Asia increased on both reported and organic net revenues basis, with currency translation affecting net revenues unfavorably by approximately $37 million. Excluding the effects of currency, net revenues increased in 2024 in both our DTC and wholesale channels.
Year Ended November 26, 2023 November 27, 2022 % Increase (Decrease) (Dollars in millions) Adjusted EBIT (1) $ 554.8 $ 713.0 (22.2) % Impact of foreign currency exchange rates — 5.7 * Constant-currency Adjusted EBIT $ 554.8 $ 718.7 (22.8) % Adjusted EBIT margin 9.0 % 11.6 % (22.4) % Impact of foreign currency exchange rates — 0.1 % * Constant-currency Adjusted EBIT margin (2) 9.0 % 11.7 % (23.1) % _____________ (1) Adjusted EBIT is reconciled from net income which is the most comparable GAAP measure.
Year Ended December 1, 2024 November 26, 2023 % Increase (Decrease) (Dollars in millions) Adjusted EBIT (1) $ 649.9 $ 554.8 17.1 % Impact of foreign currency exchange rates — (11.9) * Constant-currency Adjusted EBIT $ 649.9 $ 542.9 19.7 % Adjusted EBIT margin 10.2 % 9.0 % 13.3 % Impact of foreign currency exchange rates — (0.1) % * Constant-currency Adjusted EBIT margin (2) 10.2 % 8.9 % 14.6 % _____________ (1) Adjusted EBIT is reconciled from net income which is the most comparable GAAP measure.
During the year ended November 26, 2023, we recognized restructuring charges of $20.3 million as compared to $9.1 million in the prior year. The charges consist primarily of severance and other post-employment benefits related to a restructuring initiative that commenced in the prior year.
During the years ended November 26, 2023 we recognized restructuring charges of $20.3 million consisting primarily of severance and post-employment benefits related to a restructuring initiative that commenced in 2022. Goodwill and other intangible asset impairment charges During the year ended December 1, 2024, we recognized impairment charges of $116.9 million.
Excluding the effects of currency, the decrease in operating income was primarily due to a lower gross margin and higher SG&A expenses as a percent of revenue as compared to the prior year. • Asia. Currency translation unfavorably affected operating income in the segment by approximately $10 million as compared to the prior year.
Currency translation unfavorably affected operating income in the segment by approximately $8 million as compared to the prior fiscal year. Excluding the effects of currency, the decrease in operating income was primarily due to higher SG&A expenses, which more than offset higher net revenues and gross margin in the current year as compared to the prior fiscal year.
Dollar against various foreign currencies, including the Euro, Mexican Peso, and British Pound, may negatively impact our financial results, revenue, operating margins and net income. • The current domestic and international political environment, including volatile trade relations, the conflict involving Russia and Ukraine, the Israel-Hamas war, and civil unrest taking place in certain parts of the world have resulted in uncertainty surrounding the future state of the global economy.
Dollar against various foreign currencies, including the Euro and Mexican Peso, has in the past and may in the future negatively impact our financial results, revenue, operating margins and net income. • 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 were 36 more Docker’s stores in operation as of November 26, 2023, as compared to November 27, 2022. 51 Table of Contents Gross profit The following table shows consolidated gross profit and gross margin for the periods indicated and the changes in these items from period to period: Year Ended November 26, 2023 November 27, 2022 % Increase (Decrease) (Dollars in millions) Net revenues $ 6,179.0 $ 6,168.6 0.2 % Cost of goods sold 2,663.3 2,619.8 1.7 % Gross profit $ 3,515.7 $ 3,548.8 (0.9) % Gross margin 56.9 % 57.5 % As compared to the same period in the prior year, currency translation unfavorably impacted gross profit by approximately $6 million.
Currency translation did not have a significant impact on net revenues. 53 Table of Contents Gross profit The following table shows consolidated gross profit and gross margin for the periods indicated and the changes in these items from period to period: Year Ended December 1, 2024 November 26, 2023 % Increase (Decrease) (Dollars in millions) Net revenues $ 6,355.3 $ 6,179.0 2.9 % Cost of goods sold 2,539.4 2,663.3 (4.7) % Gross profit $ 3,815.9 $ 3,515.7 8.5 % Gross margin 60.0 % 56.9 % As compared to the same period in the prior year, currency translation unfavorably impacted gross profit by approximately $27 million.
(6) For the year ended November 26, 2023, the pension settlement relates to the Company purchasing nonparticipating annuity contracts in order to transfer certain retiree liabilities to an insurer, resulting in a one-time settlement charge of $19.0 million. (7) The unrealized gains on marketable equity securities is related to an out-of-period adjustment recognized in the fourth quarter of 2022.
(6) For the year ended November 26, 2023, the pension settlement relates to the Company purchasing nonparticipating annuity contracts in order to transfer certain retiree liabilities to an insurer, resulting in a one-time settlement charge of $19.0 million.
(6) For the year ended November 26, 2023, the pension settlement relates to the Company purchasing nonparticipating annuity contracts in order to transfer certain retiree liabilities to an insurer, resulting in a one-time settlement charge of $19.0 million. (7) The unrealized gains on marketable equity securities is related to an out-of-period adjustment recognized in the fourth quarter of 2022.
(6) For the year ended November 26, 2023, the pension settlement relates to the Company purchasing nonparticipating annuity contracts in order to transfer certain retiree liabilities to an insurer, resulting in a one-time settlement charge of $19.0 million.
Compared to fiscal year 2022, Adjusted EBIT of $554.8 million decreased from $713.0 million primarily due to higher Adjusted SG&A expenses, driven by selling expenses in support of our DTC business. • Adjusted EBIT margin was 9.0%, 260 basis points lower than the prior year on a reported basis and 270 basis points lower on a constant-currency basis. • Adjusted net income.
Compared to fiscal year 2023, Adjusted EBIT of $649.9 million increased from $554.8 million primarily due to higher revenue and gross profit, partially offset by higher Adjusted SG&A expenses, driven by selling expenses in support of our DTC business. • Adjusted EBIT margin was 10.2%, 120 basis points higher than the prior fiscal year on a reported basis and 130 basis points higher on a constant-currency basis. • Adjusted net income.
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.
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 2024 was a 53-week year, ending on December 1, 2024, and 2023 was a 52-week year ending November 26, 2023.
The decrease in gross margin was primarily due to increased product costs and lower full priced sales, partially offset by favorable channel mix. Additionally currency, including both transaction and translation impacts, favorably impacted gross margin by approximately 20 basis points.
The increase in gross margin was primarily due to lower product costs and favorable channel and brand mix. Additionally currency, including both transaction and translation impacts, unfavorably impacted gross margin by approximately 50 basis points.
Levi's Brands operating income . • Americas. Currency translation favorably affected operating income in the segment by approximately $10 million as compared to the prior year.
Currency translation unfavorably affected operating income in the segment by approximately $2 million as compared to the prior fiscal year.
For the years ended November 26, 2023 and November 27, 2022, we recorded net other expenses of $42.2 million and net other income of $28.8 million, respectively.
For the years ended December 1, 2024 and November 26, 2023, we recorded net other expenses of $3.3 million and $42.2 million, respectively.
Year Ended November 26, 2023 November 27, 2022 % Increase (Decrease) (Dollars in millions, except per share amounts) Adjusted net income (1) $ 440.7 $ 603.9 (27.0) % Impact of foreign currency exchange rates — 20.1 * Constant-currency Adjusted net income $ 440.7 $ 624.0 (29.4) % Constant-currency Adjusted net income margin (2) 7.1 % 10.1 % Adjusted diluted earnings per share $ 1.10 $ 1.50 (26.7) % Impact of foreign currency exchange rates — 0.05 * Constant-currency adjusted diluted earnings per share $ 1.10 $ 1.55 (29.0) % _____________ (1) Adjusted net income is reconciled from net income which is the most comparable GAAP measure.
Year Ended December 1, 2024 November 26, 2023 % Increase (Decrease) (Dollars in millions, except per share amounts) Adjusted net income (1) $ 502.7 $ 440.7 14.1 % Impact of foreign currency exchange rates — (5.3) * Constant-currency Adjusted net income $ 502.7 $ 435.4 15.5 % Constant-currency Adjusted net income margin (2) 7.9 % 7.1 % Adjusted diluted earnings per share $ 1.25 $ 1.10 13.6 % Impact of foreign currency exchange rates — (0.02) * Constant-currency adjusted diluted earnings per share $ 1.25 $ 1.08 15.7 % _____________ (1) Adjusted net income is reconciled from net income which is the most comparable GAAP measure.
Compared to the fourth quarter of 2022, Adjusted net income of $178.6 million increased from $136.6 million. The increase was primarily due to the higher Adjusted EBIT described above. • Diluted earnings per share.
The increase was due to higher revenue and gross profit described above, partially offset by higher Adjusted SG&A. • Adjusted net income. Compared to the fourth quarter of 2023, Adjusted net income of $202.2 million increased from $178.6 million. The increase was primarily due to the higher Adjusted EBIT described above. • Diluted earnings per share.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeAs of November 26, 2023 As of November 27, 2022 Average Forward Exchange Rate Notional Amount Fair Value Average Forward Exchange Rate Notional Amount Fair Value (Dollars in millions) Currency Australian Dollar 0.67 $ 4.2 $ 0.7 0.69 $ (2.8) $ 0.4 Brazilian Real 5.21 5.1 (0.2) 5.12 6.8 0.4 Canadian Dollar 1.34 7.2 0.2 1.30 95.9 2.1 Swiss Franc 0.88 (19.1) 0.1 0.93 (7.2) — Chilean Peso 916.55 12.0 (0.4) 924.50 11.3 0.3 Czech Koruna 22.64 (1.0) — 23.54 (1.3) — Danish Krone 6.85 (1.6) — 7.10 (1.4) — Euro 1.10 62.5 5.5 1.08 (104.8) 9.9 British Pound Sterling 1.22 135.7 (2.0) 1.20 95.1 0.7 Hong Kong Dollar 7.80 2.8 — 7.82 6.8 — Hungarian Forint 351.37 (4.8) — 403.53 (3.4) — Japanese Yen 133.60 34.0 1.7 126.47 31.7 1.4 South Korean Won 1,299.63 — — 1,269.54 23.2 0.8 Mexican Peso 18.14 (20.3) (1.0) 20.92 (17.2) (3.2) Norwegian Krone 10.93 (1.4) — 9.96 (1.0) — New Zealand Dollar 0.60 (5.4) 0.1 0.62 (5.6) 0.1 Polish Zloty 4.03 (0.9) — 4.61 1.6 — Swedish Krona 10.36 (3.9) — 10.04 16.3 0.5 Total $ 205.1 $ 4.7 $ 144.0 $ 13.4 73 Table of Contents Interest rate risk The following table provides information about our financial instruments that may be sensitive to changes in interest rates.
Biggest changeAs of December 1, 2024 As of November 26, 2023 Average Forward Exchange Rate Notional Amount Fair Value Average Forward Exchange Rate Notional Amount Fair Value (Dollars in millions) Currency Australian Dollar 0.66 $ (15.3) $ 0.4 0.67 $ 4.2 $ 0.7 Brazilian Real 5.17 5.2 0.8 5.21 5.1 (0.2) Canadian Dollar 1.40 15.6 (0.2) 1.34 7.2 0.2 Swiss Franc 0.87 (29.0) — 0.88 (19.1) 0.1 Chilean Peso 987.10 11.2 (0.1) 916.55 12.0 (0.4) Czech Koruna 23.82 (2.3) — 22.64 (1.0) — Danish Krone 7.01 (2.1) — 6.85 (1.6) — Euro 1.09 (15.8) 5.0 1.10 62.5 5.5 British Pound Sterling 1.23 84.3 (3.2) 1.22 135.7 (2.0) Hong Kong Dollar 7.77 3.7 — 7.80 2.8 — Hungarian Forint 387.99 (3.9) — 351.37 (4.8) — Japanese Yen 140.72 28.3 1.2 133.60 34.0 1.7 South Korean Won — — — 1,299.63 — — Mexican Peso 20.61 76.7 4.1 18.14 (20.3) (1.0) Norwegian Krone 11.12 (1.9) — 10.93 (1.4) — New Zealand Dollar 0.59 (5.8) — 0.60 (5.4) 0.1 Polish Zloty 4.12 (6.3) — 4.03 (0.9) — Swedish Krona 10.91 (4.7) — 10.36 (3.9) — Total $ 137.9 $ 8.0 $ 205.1 $ 4.7 78 Table of Contents Interest rate risk The following table provides information about our financial instruments that may be sensitive to changes in interest rates.
A net positive notional amount represents a position to buy the U.S. Dollar versus the exposure currency, while a net negative notional amount represents a position to sell the U.S. Dollar versus the exposure currency. All transactions will mature before the end of February 2025.
A net positive notional amount represents a position to buy the U.S. Dollar versus the exposure currency, while a net negative notional amount represents a position to sell the U.S. Dollar versus the exposure currency. All transactions will mature before the end of February 2026.
As of November 26, 2023 As of November 27, 2022 Total Expected Maturity Date 2024 2025 2026 2027 2028 Thereafter Total (Dollars in millions) Debt Instruments Fixed Rate (US$) $ — $ — $ — $ — $ — $ 500.0 $ 500.0 $ 500.0 Average Interest Rate — — — — — 3.50 % 3.50 % 3.50 % Fixed Rate (Euro 475 million) — — — 517.8 — — 517.8 494.5 Average Interest Rate — — — 3.375 % — — 3.375 % 3.375 % Variable Rate (US$) — — — — — — — — Average Interest Rate — — — — — — — — Total Principal (face amount) of our debt instruments (1) $ — $ — $ — $ 517.8 $ — $ 500.0 $ 1,017.8 $ 994.5 ______________ (1) Excluded from this table are other short-term borrowings of $12.5 million as of November 26, 2023, consisting of term loans and revolving credit facilities at various foreign subsidiaries which we expect to either pay over the next 12 months or refinance at the end of their applicable terms.
As of December 1, 2024 As of November 26, 2023 Total Expected Maturity Date 2025 2026 2027 2028 2029 Thereafter Total (Dollars in millions) Debt Instruments Fixed Rate (US$) $ — $ — $ — $ — $ — $ 500.0 $ 500.0 $ 500.0 Average Interest Rate — — — — — 3.50 % 3.50 % 3.50 % Fixed Rate (Euro 475 million) — — 500.9 — — — 500.9 517.8 Average Interest Rate — — 3.375 % — — — 3.375 % 3.375 % Variable Rate (US$) — — — — — — — — Average Interest Rate — — — — — — — — Total Principal (face amount) of our debt instruments (1) $ — $ — $ 500.9 $ — $ — $ 500.0 $ 1,000.9 $ 1,017.8 ______________ (1) Excluded from this table are other short-term borrowings of $5.5 million as of December 1, 2024, consisting of term loans and revolving credit facilities at various foreign subsidiaries which we expect to either pay over the next 12 months or refinance at the end of their applicable terms.
These agreements provide the legal basis for over-the-counter transactions in many of the world's commodity and financial markets. 72 Table of Contents The following table presents the currency, average forward exchange rate, notional amount and fair values for our outstanding forward contracts as of November 26, 2023 and November 27, 2022.
These agreements provide the legal basis for over-the-counter transactions in many of the world's commodity and financial markets. 77 Table of Contents The following table presents the currency, average forward exchange rate, notional amount and fair values for our outstanding forward contracts as of December 1, 2024 and November 26, 2023.
As of November 26, 2023, we had forward foreign exchange contracts, of which $946.3 million were contracts to buy and $741.1 million were contracts to sell various foreign currencies. These contracts are at various exchange rates and expire at various dates through February 2025.
As of November 26, 2023, we had forward foreign exchange contracts to buy $946.3 million and to sell $741.1 million against various foreign currencies. These contracts were at various exchange rates and expire at various dates through February 2025. Derivative Financial Instruments We are exposed to market risk primarily related to foreign currencies.
As of November 27, 2022, we had forward foreign exchange contracts to buy $649.7 million and to sell $505.7 million against various foreign currencies. These contracts were at various exchange rates and expire at various dates through February 2024. Derivative Financial Instruments We are exposed to market risk primarily related to foreign currencies.
As of December 1, 2024, we had forward foreign exchange contracts, of which $756.1 million were contracts to buy and $618.4 million were contracts to sell various foreign currencies. These contracts are at various exchange rates and expire at various dates through February 2026.
All of the $12.5 million was fixed-rate debt. 74 Table of Contents
Of the $5.5 million, $1.6 million was fixed-rate debt and $3.9 million was variable-rate debt 79 Table of Contents

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