Victoria's Secret & Co
US lingerie and beauty retailer, formerly the category leader, now fighting to hold share.
On the record
Checkpoint: Q2 FY2026 earnings, testing whether comp-sales growth and margin gains survive the tariff hit without the Fashion Show boost
The call
Sales and margins are climbing again under a new CEO, but the ground lost to SKIMS and Savage X Fenty over ten years has not been won back yet.
Victoria's Secret & Co. makes and sells bras, underwear, and sleepwear through stores and online. The company used to have an edge because of its famous stores, brand name, and staff who knew how to fit customers, but that edge has crumbled: Skims, Savage X Fenty, and Aerie have already stolen about 10 to 12 percent of the market over the past ten years by offering products that feel fresher and more on-trend. The company makes real money (6.55 billion dollars in 2025) and a new CEO has started making changes, but success depends entirely on whether the company can keep customers from switching to Skims and Savage X Fenty in the next few quarters while dealing with higher import costs and legal problems at the same time.
Why
01
AI pressure: None apparent. AI tools like virtual fitting or generative product photos help Victoria's Secret cut costs, they are not eating this business. Could AI do the core job? Unlikely.
02
Bigger players: SKIMS, Savage X Fenty, Aerie. These three took roughly 10 to 12 points of US underwear share from Victoria's Secret over the past decade, dropping it from about 32% to 20 to 22%. Could a giant copy it? Yes, easily.
03
What protects it. 1,420 stores, a fitting-trained staff of 23,000, and a brand strong enough to pull 61M+ streams for the Fashion Show relaunch.
What would change this call
Q2 FY2026 earnings report (expected around August 2026) show comp-sales growth. Would show whether the turnaround is durable or was a one-quarter Fashion Show sugar-high.
Independent market-share data (Euromonitor/NPD) for H2 2026 versus SKIMS and Savage X Fenty. Would show whether Victoria's Secret's US share loss to rivals has stabilized or is still resuming.
BBRC/Brett Blundy renews an activist stake bid or public campaign in 2026. Would show governance instability is escalating rather than resolving alongside the turnaround.
Independent market-share data (Euromonitor/NPD) for H2 2026 versus SKIMS and Savage X Fenty. Would show whether Victoria's Secret's US share loss to rivals has stabilized or is still resuming.
BBRC/Brett Blundy renews an activist stake bid or public campaign in 2026. Would show governance instability is escalating rather than resolving alongside the turnaround.
Key numbers
- FY2025 net sales $6.55B, up 5 to 6%
- Q1 FY2026 sales up 15% to ~$1.6B
- $160M tariff cost guided for FY2026
Named risks
- $160M FY2026 tariff cost could erode margin gains from promo detox strategy.
- Pomerantz securities investigation into Adore Me impairment disclosures could escalate to litigation.
- Activist investor BBRC retains large stake despite losing June 2026 board vote, renewed activism possible.
- Turnaround momentum partly driven by one-time Fashion Show event may not sustain into Q2-Q3 FY2026.
- Continued US market share loss to SKIMS, Savage X Fenty, and Aerie despite recent quarterly stabilization.
Rivals, as read in July 2026
| Rival | Direction | Evidence |
|---|---|---|
| SKIMS | gaining on | Surpassed $1B revenue by early 2025 (company-claimed) and opened own stores by Feb 2026, eroding VS store advantage |
| Savage X Fenty | gaining on | Held ~5.8% of US intimate apparel market as of 2025; founded by exec whose successor now leads VS turnaround |
| Aerie (American Eagle) | gaining on | Body-positive positioning contributed to VS US share drop from ~32% to ~20-22% since mid-2010s |
| Léays (Brett Blundy/BBRC) | contesting | Activist BBRC chairman Blundy controls rival brand Léays, cited as board conflict on May 12, 2026 |
Questions people ask
- Is Victoria's Secret profitable in 2026?
- FY2025 net sales were $6.553B, up 5-6% YoY, and Q1 FY2026 sales rose 15% to ~$1.6B with gross margin up 240bps to 37.6% as of June 2, 2026. FY2026 guidance was raised to $7.03-7.13B revenue and $550-580M adjusted operating income.
- Who is Victoria's Secret's biggest competitor?
- SKIMS and Savage X Fenty are the fastest-growing rivals. SKIMS reportedly surpassed $1B revenue by early 2025 (company-claimed), while Savage X Fenty held about 5.8% of the US intimate apparel market in 2025, per analysis dated March 20, 2026.
- Could AI replace Victoria's Secret?
- No. VS's roughly 23,000 trained store fitters, 1,420 physical stores, and Fashion Show brand IP aren't AI-replaceable. VS uses Google Cloud's Vertex AI, a partnership announced January 10, 2024, for shopping assistants and visual search, but as a tool, not a substitute.
- Who owns Victoria's Secret & Co?
- It's an independent public company on the NYSE, spun off from L Brands in August 2021. Ticker changed from VSCO to VSXY on June 2, 2026. No controlling parent, though activist BBRC led by Brett Blundy lost a board vote on June 11, 2026.
- Is Victoria's Secret losing market share to SKIMS and Savage X Fenty?
- US women's underwear market share fell from about 32% in the mid-2010s to roughly 20-22% by 2024-2025, per industry analysis published March 20, 2026, though comp-sales growth (Q1 FY2026 up 15% as of June 2, 2026) suggests recent stabilization.
- Why did Victoria's Secret change its stock ticker?
- Effective June 2, 2026, VS&Co changed its NYSE ticker from VSCO to VSXY as part of a brand repositioning tied to 'celebrating sexy,' announced May 21, 2026, alongside CEO Hillary Super's broader turnaround plan.
Timeline
- 2026-06-16Reporting confirms shareholders backed full board, defeating BBRC proxy fight
- 2026-06-11Annual meeting: shareholders re-elect full board over BBRC challenge
- 2026-06-02Ticker changes VSCO to VSXY; Q1 FY2026 sales up 15% to ~$1.6B reported
- 2026-05-21Company announces ticker change to VSXY
- 2026-05-12Board rejects BBRC nominee citing Léays conflict, loses a director
- 2026-05-11Proxy supplement cites AI/technology as board skill gap
- 2026-03-15Pomerantz LLP opens investor investigation into Adore Me impairment
- 2026-03-05FY2025 results: $6.553B revenue; DailyLook review; $119.6M Adore Me impairment
- 2025-10Victoria's Secret Fashion Show revived with inclusive casting
- 2024-01-10Google Cloud Vertex AI partnership announced for shopping experiences
Revision history
23 July 2026
First assessed. Losing its protection. The text above is fixed as of this date and is not edited afterwards.
In the same band
Sources
- Savage X Fenty: $1B by Breaking Victoria's Secret (2026-03-20)
- Victoria's Secret & Co. reports 2025 Q4 and full year results (2026-03-05)
- Victoria's Secret expects sales to top $7B this year (2026-06-02)
- Victoria's Secret's turnaround plan is working (2026-03-09)
- strong beats, stock slides on outlook (2026-03-05)
- How Victoria's Secret CEO ditched its identity crisis (2026-06-02)
- Victoria's Secret & Co (VSCO) Q4 2025 Earnings Call Highlights (2026-03-05)
- Victoria's Secret & Co. ends Adore Me subscription offering (2026-03-05)
- Victoria's Secret ends subscription program tied to $400M deal (2026-03-08)
- Victoria's Secret & Co. to Change Ticker Symbol to VSXY (2026-05-21)
- gurufocus.com (2026-07-23)
- Victoria's Secret shares surge on earnings beat, guidance raise (2026-06-02)