Listen to the article
Victoria’s Secret & Co. has postponed its first-quarter earnings report following a security incident.
The company first detected a cybersecurity breach on May 24, and engaged with protocols to contain and eliminate the unauthorized network access, according to a Tuesday press release. The retailer shut down its website two days later, paused some in-store services and temporarily halted its customer care.
The website was restored on Thursday, and most of the functions that impacted Victoria’s Secret and Pink stores have been repaired.
The incident was “a significant problem during retail’s all-important Memorial Day weekend,” according to Wells Fargo analysts led by Ike Boruchow. The full scale of the event is unknown and ongoing.
The company is still in the process of restoring access to some of its corporate systems. That recovery has prevented employees from accessing information needed to release the retailer’s Q1.
Victoria’s Secret originally was to report earnings on Thursday prior to the market’s open, and will announce a new release date at a later time. The security incident did not impact the retailer’s financial results for the quarter.
The company expects net sales to reach $1.35 billion, compared to guidance of between $1.3 billion and $1.33 billion, with an adjusted operating income of $32 million.
Victoria’s Secret is continuing to assess the full impact of the security breach, which hasn’t yet caused a material disruption to operations, according to the company. However, costs related to the incident may impact future financial results.
Victoria’s secret “will continue to have some headwinds as it works toward a turnaround — including tariff-induced margin pressure and an increased recession risk for a sensitive consumer discretionary business,” Wells Fargo analysts wrote in a Tuesday note. The security incident over a holiday weekend was “an additional near-term catalyst we did not expect,” they said.
The lingerie retailer recently adopted a limited-duration shareholder rights plan, or poison pill, after a substantial accumulation of its stock by investment firm BBRC International.
