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Victoria's Secret Builds Overseas Momentum as China Leads the Way
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Key Takeaways
VSXY's international net sales rose 20% to $273.4 million in Q2, with 10% growth on an adjusted basis.
China's strong online demand and improving store sales supported international growth.
Victoria's Secret targets 20% international sales growth in fiscal 2026, backed by store expansion.
Victoria’s Secret & Co. (VSXY - Free Report) is growing its international business, with China and European e-commerce leading the way. In China, social selling is supporting online sales, while established stores are posting stronger results. The company is expanding its presence in key markets by opening flagships and tailoring its marketing to local shoppers.
International net sales rose 20% year over year to $273.4 million in the second quarter of fiscal 2026. That total included $22 million in European Union online sales. The company began reporting those sales in its international channel in the third quarter of fiscal 2025 after moving fulfillment to its European distribution center. Adjusting for the reporting change, international net sales grew 10%.
International comparable retail sales rose at a low-teens percentage rate and comparable store sales accelerated in China. Higher franchise royalties across several markets also lifted international net sales. Lower merchandise sourcing sales to franchise partners partly offset those gains, reflecting the timing of orders and shipments.
Victoria’s Secret plans to expand its store network. Its China joint venture is projected to end fiscal 2026 with 55 to 59 full-assortment stores, up from 45 at the start of the year. The company expects 608 to 623 partner-operated stores by year-end, up from 562, with about 55% of its international fleet to use the Store of the Future format.
Management expects international growth to moderate in the second half as year-over-year comparisons get tougher. It maintained its forecast for about 20% international net sales growth in fiscal 2026. China remains the company’s strongest international growth market, with gains online and in stores as Victoria’s Secret expands its presence there.
VSXY’s Price Performance, Valuation & Estimates
Over the past six months, Victoria’s Secret’s stock has risen 135% compared with the Zacks Retail - Apparel and Shoes industry’s 12.1% growth.
Image Source: Zacks Investment Research
From a valuation standpoint, the company trades at a trailing price-to-sales ratio of 1.34, below the industry’s average of 1.44. It has a Value Score of A.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for VSXY’s current and next financial years’ earnings implies year-over-year growth of 58.3% and 22.1%, respectively. Earnings estimates for fiscal 2026 and 2027 have been revised upward by 6 cents and 4 cents, respectively, over the past 30 days.
Image Source: Zacks Investment Research
VSXY’s Zacks Rank & Other Key Picks
Victoria’s Secret currently carries a Zacks Rank #2 (Buy).
The Zacks Consensus Estimate for Tapestry’s current fiscal-year earnings and sales suggests growth of 16% and 7.2%, respectively, from the year-ago actuals. TPR delivered a trailing four-quarter average earnings surprise of 17.6%.
FIGS, Inc. (FIGS - Free Report) is an apparel company focused on the healthcare industry. Its offerings include lab coats, jackets, footwear, bags, socks and other accessories used by healthcare professionals. The company carries a Zacks Rank #2 at present.
The Zacks Consensus Estimate for FIGS’ current financial-year earnings and sales suggests growth of 105.3% and 22.5%, respectively, from the year-ago actuals. FIGS delivered a trailing four-quarter average earnings surprise of 175%.
Urban Outfitters, Inc. (URBN - Free Report) is a lifestyle products and services company that sells fashion apparel, accessories, footwear, home goods and related offerings through a portfolio of global consumer brands. The company carries a Zacks Rank of 2 at present.
The Zacks Consensus Estimate for Urban Outfitters’ current fiscal-year earnings and sales suggests growth of 14% and 9.5%, respectively, from the year-ago actuals. URBN delivered a trailing four-quarter average earnings surprise of 9.7%.
View the Zacks #1 Rank List
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Victoria's Secret Builds Overseas Momentum as China Leads the Way
Key Takeaways
Victoria’s Secret & Co. (VSXY - Free Report) is growing its international business, with China and European e-commerce leading the way. In China, social selling is supporting online sales, while established stores are posting stronger results. The company is expanding its presence in key markets by opening flagships and tailoring its marketing to local shoppers.
International net sales rose 20% year over year to $273.4 million in the second quarter of fiscal 2026. That total included $22 million in European Union online sales. The company began reporting those sales in its international channel in the third quarter of fiscal 2025 after moving fulfillment to its European distribution center. Adjusting for the reporting change, international net sales grew 10%.
International comparable retail sales rose at a low-teens percentage rate and comparable store sales accelerated in China. Higher franchise royalties across several markets also lifted international net sales. Lower merchandise sourcing sales to franchise partners partly offset those gains, reflecting the timing of orders and shipments.
Victoria’s Secret plans to expand its store network. Its China joint venture is projected to end fiscal 2026 with 55 to 59 full-assortment stores, up from 45 at the start of the year. The company expects 608 to 623 partner-operated stores by year-end, up from 562, with about 55% of its international fleet to use the Store of the Future format.
Management expects international growth to moderate in the second half as year-over-year comparisons get tougher. It maintained its forecast for about 20% international net sales growth in fiscal 2026. China remains the company’s strongest international growth market, with gains online and in stores as Victoria’s Secret expands its presence there.
VSXY’s Price Performance, Valuation & Estimates
Over the past six months, Victoria’s Secret’s stock has risen 135% compared with the Zacks Retail - Apparel and Shoes industry’s 12.1% growth.
Image Source: Zacks Investment Research
From a valuation standpoint, the company trades at a trailing price-to-sales ratio of 1.34, below the industry’s average of 1.44. It has a Value Score of A.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for VSXY’s current and next financial years’ earnings implies year-over-year growth of 58.3% and 22.1%, respectively. Earnings estimates for fiscal 2026 and 2027 have been revised upward by 6 cents and 4 cents, respectively, over the past 30 days.
Image Source: Zacks Investment Research
VSXY’s Zacks Rank & Other Key Picks
Victoria’s Secret currently carries a Zacks Rank #2 (Buy).
Tapestry, Inc. (TPR - Free Report) , which was formerly known as Coach, Inc., is a designer and marketer of accessories and lifestyle products for women and men. The company carries a Zacks Rank #2 at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The Zacks Consensus Estimate for Tapestry’s current fiscal-year earnings and sales suggests growth of 16% and 7.2%, respectively, from the year-ago actuals. TPR delivered a trailing four-quarter average earnings surprise of 17.6%.
FIGS, Inc. (FIGS - Free Report) is an apparel company focused on the healthcare industry. Its offerings include lab coats, jackets, footwear, bags, socks and other accessories used by healthcare professionals. The company carries a Zacks Rank #2 at present.
The Zacks Consensus Estimate for FIGS’ current financial-year earnings and sales suggests growth of 105.3% and 22.5%, respectively, from the year-ago actuals. FIGS delivered a trailing four-quarter average earnings surprise of 175%.
Urban Outfitters, Inc. (URBN - Free Report) is a lifestyle products and services company that sells fashion apparel, accessories, footwear, home goods and related offerings through a portfolio of global consumer brands. The company carries a Zacks Rank of 2 at present.
The Zacks Consensus Estimate for Urban Outfitters’ current fiscal-year earnings and sales suggests growth of 14% and 9.5%, respectively, from the year-ago actuals. URBN delivered a trailing four-quarter average earnings surprise of 9.7%.