Levi Strauss & Co. (NYSE:LEVI) stock fell 8.66% (As on October 7, 11:55:28 AM UTC-4, Source: Google Finance) after the company cut its full-year profit forecast after missing third-quarter revenue, as softening demand and a strengthening U.S. dollar adds to worries alongside higher costs. The jeans maker, which has been battling supply chain disruptions since the pandemic began, now further strained due to the Russia-Ukraine war, has been raising prices of its denims to battle rising costs. Further, continued supply chain disruption, primarily in the U.S., also resulted in estimated missed sales of approximately $30 to $40 million, or 2% to 3% of growth. Given more modest expectations for the fourth quarter, the company has reduced its financial outlook for fiscal year 2022. Despite these near-term challenges, the company believes it remains well positioned to achieve its long-term growth plan. Adjusted net income was $161 million compared to $197 million in the same quarter of the prior year. Adjusted EBIT was $188 million compared to $222 million in the same quarter of the prior year.

LEVI in the second quarter of FY 22 has reported the adjusted earnings per share of 40 cents, beating the analysts’ estimates for the adjusted earnings per share of 37 cents, according to Refinitiv data. The company had reported the adjusted revenue growth of 1 percent to $1.52 billion in the second quarter of FY 22, missing the analysts’ estimates for revenue of $1.62 billion. This is driven by growth in its direct-to-consumer business and increases across the U.S., Asia and Latin America. On a constant-currency basis, Levi’s brand net revenues grew 6% and Dockers brand net revenues grew 13% compared to the prior year. The continued strength of the company’s brands offset macroeconomic pressure in Europe and in the U.S., and currency headwinds globally. Wholesale net revenues increased 1% versus Q3 2021, and 6% on constant-currency basis, reflecting global demand for the Levi’s brand. The company’s global digital net revenues grew 9% compared to the same period in the prior year and comprised approximately 21% of third quarter fiscal 2022 net revenues.

The company now expects full-year 2022 adjusted profit of $1.44 to $1.49 per share, compared to prior forecast of $1.50 to $1.56. Levi’s expects full-year reported net revenue growth of 6.7% to 7.0%, representing 11.5% to 12% net revenue growth on a constant-currency basis. Earlier, the company forecast a net revenue growth of 11% to 13%.