Victoria’s Secret will regain its wings amid the return of the fashion show

Victoria’s Secret, one of the world’s largest specialty intimate retailers, is set for its biggest year yet amid the return of its iconic fashion show and a new CEO.

The company’s next major steps could be Victoria’s Secret’s last chance to regain its wings and claw its way back into the hearts of its customers.

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At the end of August, Victoria’s Secret (VSCO) reported earnings per share of $0.40, beating analysts’ expectations of $0.38 by 5% for Q2 fiscal 2024.

However, a closer look at the print reveals a Q2 earnings report with some issues.

The company’s net sales fell nearly 1 percent year-over-year to about $1.42 billion in Q2. Total comparable sales were down 3% from Q2 last fiscal year.

Net sales increased 6.4% internationally, but net sales in North American stores alone decreased 2.1% compared to the second quarter of the prior fiscal year.

Victoria’s Secret Holiday Fashion Show (Jeff Neira via Getty Images)

Jeff Neira/Getty Images

The new CEO and a fashion show return

Earlier this year, Victoria’s Secret named Hillary Super, the former CEO of Rihanna Savage X Fenty, as its new CEO.

The company’s poor performance in Q2 will do nothing to ease the transition for its new CEO, who is set to start his new role on September 9 this year.

This year will also mark the return of the famous Victoria’s Secret Fashion Show, which will take place on October 15 in New York City after a 6-year hiatus.

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Cancellation of the Victoria’s Secret Fashion Show

After a 17-year run, the iconic fashion was officially canceled in 2019, making 2018 the last Victoria’s Secret Fashion Show to date.

This cancellation came after a string of bad press involving accusations of misogyny and other controversies.

The company landed in even murkier waters when the former marketing chief said transgender and plus-size models didn’t align with the brand.

However, Victoria’s Secret’s lack of inclusivity, perfect body interpretations and encouragement of diet culture were just a few of the many reasons why the fashion show came to an end.

In May 2022, the company went to court over alleged allegations of sexual harassment and misogyny against models by high-powered men in the company. The company eventually reached a $90 million settlement with the models, but Victoria’s Secret’s reputation remained tarnished.

According to the Victoria’s Secret announcement, the 2024 fashion show will reflect “who the company is today” and revive everything it is iconic for.

Victoria’s Secret Guidance

With so many big changes in the company’s executive suite and event calendar, this refreshing new era could be Victoria’s Secret’s last chance to turn the year around.

According to Victoria’s Secret’s outlook, sales for the remainder of fiscal 2024 are forecast to decline 1% compared to fiscal 2023.

The company expects operating income to grow by an average of $287.5 million for the remainder of fiscal 2024, up nearly 9% from the prior guidance average for the same year.

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Despite the company’s performance in Q2 of fiscal 2024, its stock is still over 31% higher than a year ago, signaling strong potential upside in the coming months.

North American net sales were down from a year ago, but have improved over the past four quarters.

“The improvement is driven by product novelty and acceptance, particularly in the VS and PINK brands. We expect business trends in North America to continue to improve. While the overall market may remain challenging, our business is showing sequential improvement,” said the Head of Finance and Administration. Officer Tim Johnson on the earnings call.

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