Victoria's Secret bets on "fun" to power comeback
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Illustration: Aïda Amer/Axios
Victoria's Secret is betting that making lingerie "fun" again can reverse years of heavy discounting and sliding sales.
Why it matters: Results released Thursday suggest the company is beginning to rebuild brand relevance and pricing power after a decade marked by an outdated image, cultural backlash and intensifying competition.
- The retailer is putting bras and brand heat back at the center of the business — while reconnecting with Gen Z shoppers.
- Retail analyst Neil Saunders tells Axios the company is now "firmly in recovery mode," pointing to rising sales and market share gains after years of stagnation.
The big picture: Victoria's Secret delivered one of its strongest quarters in years with fourth-quarter sales rising 8% to $2.27 billion. Comparable sales climbed 8% for the second straight quarter.
- Pink posted its strongest growth in a decade and the core bra business returned to annual growth for the first time since 2021.
- Total intimates grew for the first time in four years.
What they're saying: Executives said the improvement reflects a sharper focus on bras, fewer blanket promotions, and bigger marketing moments — including the revived fashion show and buzzy Valentine's campaigns — that helped rebuild brand buzz.
- "Intimates should not be a serious business," CEO Hillary Super said. "This is about fun and escape and joyfulness."
Reality check: Shares fell as much as 16% Thursday afternoon despite the beat — a pullback that follows a 137% surge over the past year.
- Executives said higher marketing spending and incentive pay weighed on margins even as sales beat expectations.
- Saunders, managing director at GlobalData, said the decline appears tied to one-off structural changes, including an impairment charge tied to Adore Me and the company's review of DailyLook, which may have impacted valuations.
Tariffs also remain a headwind. The company expects roughly $160 million in incremental gross tariff costs this year but plans to offset most of that impact.
- Super told the Wall Street Journal that Victoria's Secret did not pass tariff-related costs onto consumers.
What's next: The company expects fiscal 2026 sales of $6.85 billion to $6.95 billion and operating income of $430 million to $460 million — projecting another year of revenue and margin growth despite tariff pressure.
- First-quarter sales are forecast to rise 10% to 13%, suggesting momentum will carry beyond the Valentine's Day push.
The bottom line: Victoria's Secret is still cleaning up past bets. But its turnaround is now driving measurable growth — as the legacy brand reclaims its boldness with a more modern edge.
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