Victoria's Secret & Co Q4 2024 Earnings Call Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Matthew Boss - JPMorgan - Analyst : Great. Thanks. So Hillary maybe -- could you elaborate on drivers of the gradual improvement that you embedded through the year? What do you see as transitory within some of your near-term trends? And maybe if you could speak to the product pipeline for the back half of the year at both VS and PINK?

Question: Adrienne Yih - Barclays - Analyst : Great. Thank you very much. Hillary, I'm interested to, you arrived in September and you've made some changes very quickly on sort of inventory and kind of new product. Wondering over what horizon you just mentioned August, over what horizon sort of do you think that you will have your full imprint on kind of the product? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MARCH 06, 2025 / 1:00PM, VSCO.N - Q4 2024 Victoria's Secret & Co Earnings Call And then secondarily, a couple of things that you had said, I think, on the October meet and great was that the inventory productivity was being hampered by the production lead times. So if you can talk about some efforts on that front. And my last quick one is, it's clear that you're pulling back on promotions. That sometimes leads to a slowdown or some sluggishness in inventory velocity, but the profitability is better. So can you talk about kind of that shaping and how you -- the margins before you get that acceleration in sales? Thank you very much.

Question: Adrienne Yih - Barclays - Analyst : The lead times, yes.

Question: Simeon Siegel - BMO Capital Markets - Analyst : Thanks. Hey, everyone. Good morning. Scott, welcome. TJ, it's been great working with you. Thanks. Best of luck on your next chapter. Hey, Hillary. Thanks for the path to potential detail. Any way to quantify the top line opportunity within those various pillars? Just maybe thinking about how you're viewing various opportunities across brands, categories, and regions maybe in quantitative detail? And then just given the comment about expanding beyond bra-centric, could you share how much of the opportunity as you see it to grow is rooted in recapturing lost revenue in each segment versus expecting maybe the go-forward company revenues composition to look different than the past? Thank you.

Question: Simeon Siegel - BMO Capital Markets - Analyst : All right. That's great. Thank you. And then just one quick follow-up. Any meaningful divergence in regions or customer demographic profiles in January and Feb that you guys have seen?

Question: Corey Tarlowe - Jefferies - Analyst : Great. Thanks and good morning. So I was wondering if you could talk about the opportunity that you see in creating some of these separate tracks for product lines in terms of your strategy and how this interplays and the opportunity with particular categories that are -- have been historically REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MARCH 06, 2025 / 1:00PM, VSCO.N - Q4 2024 Victoria's Secret & Co Earnings Call very important for the company like swim and athletic. And then also if you could also just comment on Valentine's Day and anything that was working during that timeframe that would also be very helpful too. Thank you so much.

Question: Jungwon Kim - TD Cowen - Analyst : Thank you for taking my question. Just thinking about the guide for the year, what could potentially drive upside or downside to your guide as you look forward? And then just a follow-up on the store of the future formats and sort of what are you seeing at this point with your concepts that have been live? And what are you baking in terms of potential lift from those concepts as you continue to roll them out? Thank you so much.

Question: Jungwon Kim - TD Cowen - Analyst : Yes, sorry, I'm glad, I'm in a cold. So, yes, the voice is somewhat gone. But, yes, just potential upside and downside to your guide for the full year like what the key factors that could potentially drive upside or downside to your current year guide?

Question: Alex Straton - Morgan Stanley - Analyst : Perfect. Thanks for taking the question. Maybe first for Hillary, it's clear you're super focused on PINK more so than the other banners and other parts of the business right now. Can you just elaborate on what's telling you that that's the right banner to focus on compared to Victoria's? And then just a second question either for Scott or Hillary is just, can you dive into the biggest category pain points at Victoria's and PINK right now and sort of plans to improve those in '25? Thanks a lot.

Question: Mauricio Serna - UBS - Analyst : Great. Good morning. Thanks for taking my question. Maybe one thing that I wanted to get more detail. I remember like from the Investor Day from a couple of years ago, you still have around $40 million of savings that I think we're -- should materialize in 2025. I was just wondering if that's still the case, and where should we see that? And then maybe could you elaborate a little bit on two things. On the marketing, you said you want to do like more marketing to show like this -- to differentiate like one brand, PINK from Victoria's Secret. Could you just talk a little bit more about what are some initiatives on that side? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MARCH 06, 2025 / 1:00PM, VSCO.N - Q4 2024 Victoria's Secret & Co Earnings Call And then lastly, on any product launches that you've already done like not talking about anything that's coming, but anything that you've already done that you would highlight across, again, both brands that you think it's worth noting? Thank you so much.

Question: Mauricio Serna - UBS - Analyst : And the product, sorry? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MARCH 06, 2025 / 1:00PM, VSCO.N - Q4 2024 Victoria's Secret & Co Earnings Call

Question: Mauricio Serna - UBS - Analyst : Great. And just one quick follow-up. I don't know if you mentioned this. In your guidance, how should we think about the promotional activity like is it going to be like more promotional versus last year or flat or slightly lower? Just wanted to get a sense of that.

Question: Juliana Duque - Wells Fargo - Analyst : Good morning, everyone. This is Juliana on for Ike. Just a quick question on international. Wondering if we could get some more color on what's going on there with the shifts we saw from 3Q to 4Q and maybe in growth expectations for 1Q and the rest of the year if possible? Thank you.

Question: Brooke Roach - Goldman Sachs - Analyst : Good morning and thank you for taking our question. Hillary, I'm hoping you could speak to the size of your sport and swim businesses today as well as the growth opportunity that you see this year and medium term as you establish those larger businesses. And then for Scott, there's been a lot of discussion about marketing today on the call. I was hoping that you could contextualize your expectations for SG&A for the year and how that item might trend as a percent of sales as we move throughout the rest of the year. Thank you.

Question: Marni Shapiro - Retail Tracker - Analyst : Thanks, guys, and congratulations on some of the progress at PINK that Valentine's Day set, I think was the best I've seen in five years, maybe longer than that even. It's fantastic. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MARCH 06, 2025 / 1:00PM, VSCO.N - Q4 2024 Victoria's Secret & Co Earnings Call So I want to dig in just a little bit on PINK. You gave a pretty clear indication of what your goal is marketing-wise on VS with sexy, glamorous, lux. I'm curious, what like those three words are for PINK? And if you're not there yet and you're still working on it, that's okay. But I'm curious what you're thinking about it today because that shopper, that young girl is different today than that young girl was when this brand was born? And then, just also curious, we've talked a lot about marketing here. You talked a lot about the success of the fashion show and the halo it gave. Should we assume that the fashion show is going to be a thing in '25? And what should the marketing look like across the quarters? Will it be a little less lumpy then this year than it was last year?

Question: Marni Shapiro - Retail Tracker - Analyst : Obviously.

Question: Marni Shapiro - Retail Tracker - Analyst : So the show will be back though in '25.