Victoria’s Secret Jumps as Sales Decline Moderates

Catherine Larkin, Bloomberg News

Shoppers in Victoria's Secret store in Montreal, Quebec, Canada.

, Bloomberg

(Bloomberg) -- Victoria’s Secret & Co. said sales have improved despite more promotions and tough competition.

The lingerie maker said Thursday that its preliminary sales and adjusted profit for the quarter ended May 4 were at the high end or above its prior projections. Net sales were down 3% to 4% in the period, compared with an expected decline of as much as 6%. The company said online sales are outpacing in-store results.

Victoria’s Secret has been grappling with sagging sales for the better part of the last two years. To attract customers and regain relevance, the retailer rebranded its fashion show and expanded its swim and apparel categories. Chief Executive Officer Martin Waters said that shoppers are liking the new merchandise and sales trends are improving for both the namesake brand and the PINK apparel line.

At the same time, Martin cautioned that the North American retail market remains challenging with increased discounting and competition. The company kept its full-year guidance the same despite the relatively upbeat quarter.

Shares of Victoria’s Secret rose as much as 12% in extended trading. They had fallen 30% so far this year through Thursday’s close.

(Updates with additional details beginning in second paragraph.)