The denim maker Levi Strauss & Co.’s gross sales fell 62% throughout its fiscal second quarter, the corporate introduced Tuesday, as its on-line gross sales weren’t sufficient to make up for its shops being briefly shut for roughly 10 weeks in the course of the Covid-19 disaster. Shoppers by and enormous have shifted away from tight pants and denim, opting as a substitute for loungewear and pants with elastic waistbands to put on round the home — in the event that they’re even looking for garments. Levi’s additionally introduced it will likely be slashing about 15% of its world company workforce, impacting about 700 jobs, in a bid to chop prices in the course of the coronavirus pandemic. It stated the transfer ought to generate annualized financial savings for Levi’s of $100 million. Its shares initially fell in after-hours buying and selling however not too long ago have been up lower than 1%. “Though we’re beginning to see some inexperienced shoots, we have to proceed to be cautious,” Chief Government Chip Bergh stated in a memo despatched to the corporate’s staff, which was obtained by CNBC. “There may very well be a second wave,” of Covid-19 circumstances and ensuing retailer closures, he added. Bergh’s feedback come as circumstances are rising quickly within the U.S. in current weeks, prompting some state and native governments to sluggish reopening or reimpose measures designed to curb the unfold of coronavirus. Total retail retailer visitors declines have accelerated once more previously two weeks, in line with information from ShopperTrak. In the present day, whereas about 90% of Levi’s shops have reopened worldwide, visitors and gross sales are nonetheless lagging ranges from a yr in the past, Bergh stated. An entire restoration “will probably take a while,” he stated. This is how Levi’s did in the course of the quarter ended May 24: Adjusted loss per share: 48 cents Income: $498 million The San Francisco-headquartered firm reported a web lack of $364 million, or 91 cents a share, in contrast with web revenue of $29 million, or earnings of seven cents per share, a yr in the past. Excluding one-time costs, Levi’s misplaced 48 cents a share. The loss was largely attributable to $242 million in restructuring costs and stock prices associated to disruptions from the pandemic, the corporate stated. Income fell 62% to $498 million from $1.31 billion a yr in the past. Analysts have been calling for Levi’s to report an adjusted lack of 49 cents per share on income of $486 million, in line with Refinitiv information. The corporate stated losses have been partially offset by its e-commerce enterprise, which grew 25% in the course of the second quarter, making up 15% of complete web income in the course of the interval, in contrast with simply 5% a yr prior. Nonetheless, gross sales in its Americas area have been down 59% total. They dropped 68% in Europe and 61% in Asia. “In contrast to numerous our friends … we took the brunt of this in a single quarter,” Bergh advised CNBC in a telephone interview. Now, with about 90% of shops again up and operating, roughly 40% are reporting gross sales progress in contrast with final yr, in some situations exceeding the corporate’s inside expectations, he stated within the interview. However Levi’s has plans in place in case it must shut numerous these doorways once more. Apple has taken the lead and closed dozens of shops in states like Florida and Texas for a second time, with Covid-cases nonetheless on the rise in sure scorching spots. Based on Bergh, Levi’s has about 40 places within the U.S. that it’s presently monitoring intently, checking them each Monday, Wednesday and Friday. “There are a number of doorways getting shut,” he stated. Inventories ended the second quarter up 10%, Levi’s stated. Based on Bergh, a lot of Levi’s merchandise is “evergreen,” which means the corporate can stow it away and it’ll nonetheless be in type subsequent season. Levi’s stated it ended the quarter with complete liquidity of roughly $2 billion, with $448 million nonetheless obtainable underneath the corporate’s revolving credit score facility. The corporate isn’t providing a 2020 outlook at the moment. Levi’s shares are down about 27% from a yr in the past. The corporate has a market cap of $5.5 billion.