V.F. (NYSE:VFC) executives highlighted a return to growth and better-than-expected profitability in the company’s third-quarter fiscal 2026 earnings call, pointing to strength in the Americas and a first positive quarter for direct-to-consumer revenue in “a couple of years,” according to management. The company also emphasized continued progress on debt reduction and reiterated key full-year financial targets.
Third-quarter results top expectations
President and CEO Bracken Darrell said the company “had a very strong Q3,” with revenue up 2% and operating income above internal expectations. CFO Paul Vogel reported third-quarter revenue of $2.8 billion, up 2% year over year on a constant-dollar basis, which exceeded the company’s guidance range of down 1% to down 3%.
On profitability, Vogel reported adjusted gross margin increased 10 basis points year over year, supported by mix and sourcing savings that reduced product costs and offset tariffs. He said the third quarter included the “first meaningful impact of tariff flow through the gross margin,” with an unmitigated impact of about $40 million, noting that pricing actions were implemented in the fourth quarter and did not benefit the third quarter.
VF’s adjusted operating margin for the quarter was 12.1%, up 30 basis points year over year. Adjusted earnings per share were $0.58, compared to $0.61 in the prior-year quarter.
Americas strength and DTC inflection
By region, the Americas rose 6% while EMEA declined 3% and APAC declined 4%, which Vogel said was in line with expectations for the international markets. By channel, DTC increased 3%, which Vogel described as the company’s “first positive quarter in a couple of years,” driven by strong e-commerce performance. Wholesale revenue declined 1% overall, though management said wholesale grew in the Americas.
Darrell framed the U.S. improvement as a key turnaround milestone, calling it “one of our strongest performances in the Americas in over three years.” On the question of consumer demand and broader pricing increases in the market, Darrell said the company has “so much within our control” and pointed to multiple “levers to pull” as the turnaround continues, even in what he called a “choppy environment.”
Brand performance: The North Face and Timberland lead; Vans shows “green shoots”
The North Face posted revenue growth of 5% in the quarter, led by growth in both DTC and wholesale. Vogel said The North Face’s Americas business grew 15%, while APAC declined 3% and EMEA declined 2%. Darrell said all product categories were up, highlighting double-digit growth in footwear and strong performance from the brand’s Summit Series, which grew at a double-digit rate in all regions.
Darrell also discussed product elevation and premium launches, including a leather jacket priced at $1,100 that “sold out in less than 24 hours.” He said the brand opened its largest global flagship store on Fifth Avenue in New York, which “has delivered strong results in its initial weeks of trading,” and noted what he described as the brand’s strongest “social-first” marketing performance to date. He also cited results from the second installment of The North Face’s collaboration with Skims.
Timberland grew 5% in the quarter, with Darrell citing the 6-Inch Premium Boot as a key driver. Vogel said Timberland’s growth reflected momentum in the Americas and EMEA, while APAC was down. Darrell also pointed to double-digit growth in boat shoes across all regions and said the brand is expanding into transitional styles for warmer seasons. He added that search interest is growing in the U.S. and key EMEA markets.
Vans remained a drag on consolidated results, with revenue down 10% in the quarter, consistent with management’s expectations. Still, Darrell said the company is seeing “green shoots,” including growth in global digital revenue led by the Americas, and said new products such as the Super Lowpro, Skate Loafer, and Crosspath XC delivered growth again. Vogel later told analysts the underlying trend was down high single digits in Q3, similar to prior quarters, with Q4 expected to improve to a mid-single-digit decline.
Management said VF’s global e-commerce sales for Vans grew for the first time in more than four years, led by the Americas. However, Darrell said store traffic did not turn positive in the quarter, while Vogel noted traffic remained down but improved slightly sequentially from Q2 to Q3.
Altra growth and leadership transition
Darrell said Altra grew 23% year over year and reiterated expectations that the brand is on track to exceed $250 million in revenue in fiscal 2026. He later told analysts that Altra could “probably” reach about $270 million this year, adding that he sees “a billion-dollar-plus potential” for the brand, while emphasizing VF is intentionally controlling distribution to build credibility in both trail and road running.
VF also announced a planned leadership change: Chief Commercial Officer Martino Scabbia Guerrini will step down from the role and will remain an advisor to Darrell during the transition. Brent Hyder will assume the Chief Commercial Officer role in addition to serving as President, Americas.
Balance sheet, cash flow, and outlook
VF reported inventory down 4% year over year on a constant-dollar basis. On a reported basis, free cash flow through Q3 was $513 million, which Vogel said was in line with expectations and broadly flat to last year, even after approximately $100 million of incremental tariff payments year to date. Reported net debt, including lease liabilities, declined by about $500 million year over year, or 11%. VF also said it plans to prepay its March 2026 EUR 500 million notes in February, after quarter end.
For the fourth quarter, management guided to revenue flat to up 2% on a constant-dollar basis, with an expected positive FX benefit of about 5% to the top line. The company expects The North Face growth to be broadly in line with Q3, slower growth at Timberland, and Vans down “roughly mid-single digits.” VF guided adjusted operating income to $10 million to $30 million for Q4, with gross margin expected to be flat to slightly up as pricing actions and sourcing savings offset tariffs.
Looking at the full year, Vogel said VF expects annual revenue to be flat to up, gross margin at 54.5% or better, operating margin at 6.5% or better, operating and free cash flow to be up versus last year, and leverage at 3.5x or lower, down from 4.1x at the end of fiscal 2025. Executives also discussed the possibility of reintroducing full-year guidance in the future, with Darrell saying the company is “seriously considering it” and that a fourth-quarter timing would be logical if VF chooses to do so.
About V.F. (NYSE:VFC)
VF Corporation, commonly branded as VF, is a global apparel and footwear company that develops, markets and distributes a diverse portfolio of consumer brands. Its offerings span outdoor and action sports apparel, footwear and accessories under marquee names such as The North Face, Vans, Timberland, Dickies, JanSport and Smartwool. Through a “house of brands” strategy, VF leverages the unique heritage and design expertise of each label to serve distinct lifestyle and performance segments.
Founded in 1899 in Pennsylvania as the Reading Glove and Mitten Manufacturing Company, VF evolved through a series of acquisitions and strategic expansions to become a leading player in the global apparel industry.
