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VF Corporation, owner of The North Face and Timberland, on Monday lowered its revenue and earnings expectations for the second half of its fiscal year and said its chairman and chief executive is retiring.
CEO Steve Rendle is stepping down from his post after almost six years, effective immediately, the company said in a press release. Benno Dorer, who sits on the company’s board, will serve as interim CEO while the company searches for Rendle’s permanent replacement. Richard Carucci will serve as interim chairman of the board.
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Shares of the company fell 11% to $29.51 by market close on Monday. Credit Suisse on Monday downgraded the stock to a “neutral” rating in light of what it called an “abrupt” CEO transition and the reduced forecast.
VF Corp. said it now expects full-year revenue to increase by 3% or 4% over the prior year, down from previously projected growth of 5% or 6%. It estimates its full-year earnings to come in at about $2.00 to $2.20 per share, down from previous guidance of $2.40 to $2.50, announced a few weeks ago.
VF Corp. reported full-year earnings of $3.18 per share last year.
This is the second time in less than two months that VF Corp. has slashed its guidance. VF attributed its lowered financial outlook to “weaker than anticipated consumer demand,” especially in its North American market, which has caused fewer sales and more order cancellations. It also cited the overall tightening of consumer spending as a result of inflation and Covid-related disruption in China.
Those challenges may take a toll on short-term profitability, the company said.