We use cookies to understand how you use our site and to improve your experience.
This includes personalizing content and advertising.
By pressing "Accept All" or closing out of this banner, you consent to the use of all cookies and similar technologies and the sharing of information they collect with third parties.
You can reject marketing cookies by pressing "Deny Optional," but we still use essential, performance, and functional cookies.
In addition, whether you "Accept All," Deny Optional," click the X or otherwise continue to use the site, you accept our Privacy Policy and Terms of Service, revised from time to time.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Will China Remain Victoria's Secret's Top International Growth Engine?
Read MoreHide Full Article
Key Takeaways
VSXY's international net sales rose 20%, with China leading growth across digital and stores.
VSXY said China remains its #1 international growth area, supported by strong digital and social selling.
VSXY expects international growth to moderate as lower-margin franchise sales weigh on results.
Victoria’s Secret & Company (VSXY - Free Report) continues to identify China as its #1 growth area within international markets, although the company expects international growth to moderate somewhat in the second half. International net sales increased 20% year over year in the second quarter of fiscal 2026, with retail comparable sales up in the low teens. China led the growth, with strong performance across both digital and stores.
The company specifically stated that China remains its #1 growth area within international markets, with management remaining highly encouraged by its performance. Growth continues to be led by the digital channel, which is heavily supported by social selling, while retail comparable sales have also accelerated. Management is particularly pleased with the performance of its stores in China heading into the back half of the year, as the company is now lapping the accelerated growth that began around last year’s 618 event. The company continues to feel strong about the market.
The moderation in international growth was largely related to lower merchandise sourcing sales to franchise partners, reflecting order and shipment timing. Management described these franchise-partner sales as low-margin and said that the shift was the biggest drag on the international growth deceleration. At the same time, management remained encouraged by China’s performance. China’s accelerated growth began around last year’s 618 shopping event, and the company has now lapped that acceleration.
Overall, Victoria’s Secret’s confidence in China provides a constructive foundation for its international growth outlook. With the market continuing to develop across both digital and physical channels, the company has an opportunity to build on its progress and further expand its presence in China. If the current momentum is sustained, China could play an increasingly important role in supporting Victoria’s Secret’s international growth over the coming years.
The Zacks Rundown for VSXY
Shares of this Zacks Rank #3 (Hold) company have gained 90.1% in the past six months against the industry’s decline of 6.9%.
Image Source: Zacks Investment Research
From a valuation standpoint, VSXY trades at a forward price-to-earnings ratio of 16.95, higher than the industry’s average of 12.45.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for VSXY’s current and next fiscal year earnings implies a year-over-year rise of 56.3% and 22.7%, respectively.
Image Source: Zacks Investment Research
Stocks to Consider
Some better-ranked stocks have been discussed below:
The Zacks Consensus Estimate for FIGS’s current fiscal-year sales and earnings implies growth of 19.8% and 89.5%, respectively, from the year-ago figures. FIGS has delivered a trailing four-quarter earnings surprise of 201.8%, on average.
Fossil Group, Inc. (FOSL - Free Report) designs, develops, markets, and distributes consumer fashion accessories in the United States, Europe, Asia, and internationally. At present, FOSL carries a Zacks Rank of 2.
The Zacks Consensus Estimate for FOSL’s current fiscal-year sales indicates a decline of 4%, while the same for earnings indicates growth of 96.7% from the year-ago figures. FOSL delivered a trailing four-quarter negative earnings surprise of 236.2%, on average.
Boot Barn Holdings, Inc. (BOOT - Free Report) operates specialty retail stores in the United States and internationally. At present, Boot Barn carries a Zacks Rank of 2.
The consensus estimate for Boot Barn’s current fiscal-year sales and earnings implies growth of 15.8% and 23.5%, respectively, from the year-ago figures. BOOT delivered a trailing four-quarter earnings surprise of 11.4%, on average.
View the Zacks #1 Rank List
Image: Bigstock
Will China Remain Victoria's Secret's Top International Growth Engine?
Key Takeaways
Victoria’s Secret & Company (VSXY - Free Report) continues to identify China as its #1 growth area within international markets, although the company expects international growth to moderate somewhat in the second half. International net sales increased 20% year over year in the second quarter of fiscal 2026, with retail comparable sales up in the low teens. China led the growth, with strong performance across both digital and stores.
The company specifically stated that China remains its #1 growth area within international markets, with management remaining highly encouraged by its performance. Growth continues to be led by the digital channel, which is heavily supported by social selling, while retail comparable sales have also accelerated. Management is particularly pleased with the performance of its stores in China heading into the back half of the year, as the company is now lapping the accelerated growth that began around last year’s 618 event. The company continues to feel strong about the market.
The moderation in international growth was largely related to lower merchandise sourcing sales to franchise partners, reflecting order and shipment timing. Management described these franchise-partner sales as low-margin and said that the shift was the biggest drag on the international growth deceleration. At the same time, management remained encouraged by China’s performance. China’s accelerated growth began around last year’s 618 shopping event, and the company has now lapped that acceleration.
Overall, Victoria’s Secret’s confidence in China provides a constructive foundation for its international growth outlook. With the market continuing to develop across both digital and physical channels, the company has an opportunity to build on its progress and further expand its presence in China. If the current momentum is sustained, China could play an increasingly important role in supporting Victoria’s Secret’s international growth over the coming years.
The Zacks Rundown for VSXY
Shares of this Zacks Rank #3 (Hold) company have gained 90.1% in the past six months against the industry’s decline of 6.9%.
Image Source: Zacks Investment Research
From a valuation standpoint, VSXY trades at a forward price-to-earnings ratio of 16.95, higher than the industry’s average of 12.45.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for VSXY’s current and next fiscal year earnings implies a year-over-year rise of 56.3% and 22.7%, respectively.
Image Source: Zacks Investment Research
Stocks to Consider
Some better-ranked stocks have been discussed below:
FIGS, Inc. (FIGS - Free Report) operates as a direct-to-consumer healthcare apparel and lifestyle company in the United States and internationally. At present, FIGS carries a Zacks Rank of 2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The Zacks Consensus Estimate for FIGS’s current fiscal-year sales and earnings implies growth of 19.8% and 89.5%, respectively, from the year-ago figures. FIGS has delivered a trailing four-quarter earnings surprise of 201.8%, on average.
Fossil Group, Inc. (FOSL - Free Report) designs, develops, markets, and distributes consumer fashion accessories in the United States, Europe, Asia, and internationally. At present, FOSL carries a Zacks Rank of 2.
The Zacks Consensus Estimate for FOSL’s current fiscal-year sales indicates a decline of 4%, while the same for earnings indicates growth of 96.7% from the year-ago figures. FOSL delivered a trailing four-quarter negative earnings surprise of 236.2%, on average.
Boot Barn Holdings, Inc. (BOOT - Free Report) operates specialty retail stores in the United States and internationally. At present, Boot Barn carries a Zacks Rank of 2.
The consensus estimate for Boot Barn’s current fiscal-year sales and earnings implies growth of 15.8% and 23.5%, respectively, from the year-ago figures. BOOT delivered a trailing four-quarter earnings surprise of 11.4%, on average.