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In addition to the items described at the conclusion of this press release, in the fourth quarter of 2024 the Company recorded a change in its accounting estimate relating to expected future redemption on outstanding gift cards issued by the Company. As a result of this change in accounting estimate, the Company recognized a cumulative adjustment which increased net sales, gross margin, and operating income by approximately $26 million in the fourth quarter of 2024.

Excluding the impact from the change in accounting estimate relating to outstanding gift cards, fourth quarter 2024 net sales increased approximately 4%, or at the high-end of our previously communicated guidance range of 3% to 4% (excluding the impact of the extra week in the fourth quarter of 2023), and fourth quarter 2024 adjusted operating income would have been $273 million, or slightly above the high-end of our previously communicated guidance range of $260 million to $270 million.

As a reminder, the Company estimated the extra week in the fourth quarter of 2023 represented approximately $80 million in incremental net sales, approximately $20 million in incremental operating income and incremental net income per diluted share of approximately $0.20.

Full Year 2024 Results
The Company reported net sales of $6.230 billion for the 52-week fiscal year 2024, an increase of 1% compared to net sales of $6.182 billion for the 53-week fiscal year 2023. Total comparable sales for fiscal year 2024 were flat.

The Company reported net income of $165 million, or $2.05 per diluted share for the 52-week fiscal year 2024. This result compares to net income of $109 million, or $1.39 per diluted share for the 53-week fiscal year 2023. Operating income for the 52-week fiscal year 2024 was $310 million compared to $246 million in the 53-week fiscal year 2023.

Excluding the impact of the items described at the conclusion of this press release, adjusted net income for the 52-week fiscal year 2024 was $218 million, or $2.69 per diluted share. This result compares to adjusted net income of $178 million, or $2.27 per diluted share for the 53-week fiscal year 2023. Adjusted operating income for the 52-week fiscal year 2024 was $373 million compared to $327 million in the 53-week fiscal year 2023.

Excluding the impact from the change in accounting estimate relating to outstanding gift cards, fiscal year 2024 net sales increased approximately 2%, or at the high-end of our previously communicated guidance range of 1% to 2% (excluding the impact of the extra week in fiscal year 2023), and adjusted operating income would have been $347 million, or slightly above the high-end of our previously communicated guidance range of $315 million to $345 million.

Full Year and First Quarter 2025 Outlook
As we begin the new year, we recognize the macro environment is uncertain and consumer confidence has shifted. In addition, much of the U.S. experienced unseasonal weather creating an additional headwind to start the year, which is considered in our guidance for the first quarter. The Company is forecasting net sales for the first quarter of 2025 to be in the range of $1.30 billion to $1.33 billion compared to last year’s first quarter net sales of $1.359 billion. At this forecasted level of net sales, adjusted operating income for the first quarter of 2025 is expected to be in the range of $10 million to $30 million.

Looking ahead, our forecast assumes that the environment will gradually get better as we move through the year and as we execute on our strategies designed to grow sales in both our North America and International businesses. The Company is forecasting fiscal year 2025 net sales to be in the range of $6.2 billion to $6.3 billion compared to net sales of $6.204 billion in fiscal year 2024, which excludes the gift card breakage benefit of $26 million recognized in the fourth quarter of 2024. At this forecasted level of net sales, adjusted operating income for fiscal year 2025 is expected to be in the range of $300 million to $350 million.

Forecasted adjusted operating income for the first quarter and full year 2025 excludes the financial impact of purchase accounting items related to the Adore Me acquisition, including expense (income) related to changes in the estimated fair value of contingent consideration and performance-based payments, as well as the amortization of intangible assets. The Company is not able to provide a reconciliation of forward-looking adjusted operating income to the most directly comparable forward-looking GAAP financial measures because the Company is unable to provide a meaningful or accurate reconciliation or estimation of certain reconciling items without unreasonable effort, due to the inherent difficulty in forecasting the timing of, and quantifying, the various purchase accounting items that are necessary for such reconciliation.

Quarterly Earnings Conference Call
Victoria’s Secret & Co. will conduct its fourth quarter earnings call at 8:00 a.m. Eastern on Thursday, March 6, 2025. To listen, call 1-800-619-9066 (international dial-in number: 1-212-519-0836); passcode 5358727. For an audio replay, call 1-800-819-5743 (international replay number: 1-203-369-3828); passcode 2485654 or log onto www.victoriassecretandco.com.  The materials accompanying the earnings call have been posted on the Investors section of the Company’s website. The audio replay will be available approximately two hours after the conclusion of the call.

About Victoria’s Secret & Co.
Victoria’s Secret & Co. (NYSE: VSCO) is a specialty retailer of modern, fashion-inspired collections including signature bras, panties, lingerie, apparel, casual sleepwear, swim, lounge and sport as well as award-winning prestige fragrances and body care. VS&Co is comprised of market leading brands, Victoria’s Secret and PINK, that share a common purpose of supporting women in all they do, and Adore Me, a technology-led, digital first innovative intimates brand serving women of all sizes and budgets at all phases of life. We are committed to empowering our more than 30,000 associates across a global footprint of more than 1,380 retail stores in nearly 70 countries.

Safe Harbor Statement Under the Private Securities Litigation Reform Act of 1995

We caution that any forward-looking statements (as such term is defined in the U.S. Private Securities Litigation Reform Act of 1995) contained in this press release or made by us, our management, or our spokespeople involve risks and uncertainties and are subject to change based on various factors, many of which are beyond our control. Accordingly, our future performance and financial results may differ materially from those expressed or implied in any such forward-looking statements, and any future performance or financial results expressed or implied by such forward-looking statements are not guarantees of future performance. Forward-looking statements include, without limitation, statements regarding our future operating results, the implementation and impact of our strategic plans, and our ability to meet environmental, social, and governance goals. Words such as “estimate,” “commit,” “will,” “target,” “goal,” “project,” “plan,” “believe,” “seek,” “strive,” “expect,” “anticipate,” “intend,” “continue,” “potential” and any similar expressions are intended to identify forward-looking statements. Risks associated with the following factors, among others, could affect our results of operations and financial performance and cause actual results to differ materially from those expressed or implied in any forward-looking statements:

• general economic conditions, inflation, and changes in consumer confidence and consumer spending patterns;

• market disruptions including pandemics or significant health hazards, severe weather conditions, natural disasters, terrorist activities, financial crises, political crises or other major events, or the prospect of these events;

• uncertainty in the global trade environment, including the imposition or threatened imposition of tariffs or other trade restrictions;

• our ability to successfully implement our strategic plan;

• difficulties arising from changes and turnover in company leadership or other key positions;

• our ability to attract, develop and retain qualified associates and manage labor-related costs;

• our dependence on traffic to our stores and the availability of suitable store locations on satisfactory terms;

• our ability to successfully operate and expand internationally and related risks;

• the operations and performance of our franchisees, licensees, wholesalers and joint venture partners;

• our ability to successfully operate and grow our direct channel business;

• our ability to protect our reputation and the image and value of our brands;

• our ability to attract customers with marketing, advertising and promotional programs;

• the highly competitive nature of the retail industry and the segments in which we operate;

• consumer acceptance of our products and our ability to manage the life cycle of our brands, remain current with fashion trends, and develop and launch new merchandise, product lines and brands successfully;

• our ability to integrate acquired businesses and realize the benefits and synergies sought with such acquisitions;

• our ability to incorporate artificial intelligence into our business operations successfully and ethically while effectively managing the associated risks;

• our ability to source materials and produce, distribute and sell merchandise on a global basis, including risks related to:

  • political instability and geopolitical conflicts;

  • environmental hazards and natural disasters;

  • significant health hazards and pandemics;

  • delays or disruptions in shipping and transportation and related pricing impacts; and

  • disruption due to labor disputes;

• our geographic concentration of production and distribution facilities in central Ohio and Southeast Asia;

• the ability of our vendors to manufacture and deliver products in a timely manner, meet quality standards and comply with applicable laws and regulations;

• fluctuations in freight, product input and energy costs;

• our and our third-party service providers’ ability to implement and maintain information technology systems and to protect associated data and system availability;

• our ability to maintain the security of customer, associate, third-party and company information;

• stock price volatility;

• shareholder activism matters;

• our ability to maintain our credit rating;

• our ability to comply with regulatory requirements; and

• legal, tax, trade and other regulatory matters.

Except as may be required by law, we assume no obligation and do not intend to make publicly available any update or other revisions to any of the forward-looking statements contained in this press release to reflect circumstances existing after the date of this press release or to reflect the occurrence of future events, even if experience or future events make it clear that any expected results expressed or implied by those forward-looking statements will not be realized. Additional information regarding these and other factors can be found in “Item 1A. Risk Factors” in our Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 22, 2024.

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