Vans' parent company is trying to turn itself around. Its bottom line just got worse.

By Bill Peters

VF Corp. also announced that Paul Vogel will become its new CFO

Shares of VF Corp. tumbled after hours on Wednesday after the maker of Vans sneakers and The North Face gear reported a surprise adjusted quarterly loss, as retailers remain reluctant to stock up on new shoes and clothing amid weaker demand from shoppers.

The company (VFC) on Wednesday also appointed Paul Vogel as its new chief financial officer. Vogel, a veteran of the streaming platform Spotify Technology (SPOT), will start on July 8.

VF Corp. said in February that Matt Puckett would step down as its CFO as the company tries to turn around its fortunes and cut costs.

For its fiscal fourth quarter, VF Corp. reported a net loss of $418.3 million, or $1.08 a share. That was deeper than a loss of $214.9 million, or 55 cents a share, in the same quarter last year.

Adjusted for costs related to its turnaround plans and impairment charges, VF lost 32 cents a share. Sales fell 13% year over year to $2.37 billion.

Analysts polled by FactSet expected an adjusted profit of 2 cents a share, on revenue of $2.42 billion.

Sales at Vans declined 26% year over year, while dropping 5% at The North Face.

VF Corp. shares fell about 12% after hours. The stock is down 35% over the past 12 months.

As inflation forces more shoppers to prioritize the things they have to pay for, like groceries and rent, demand for sneakers and clothing has been softer, forcing retailers to cut prices to clear lower-demand items. That backdrop, combined with steeper competition, has forced big sneaker makers like VF Corp. and Nike Inc. (NKE) to recalibrate.

In February, executives at VF Corp. said that newer Vans sneakers, including its Knu Skool line, had become popular among young girls. They said the company planned to push more new products and change up its marketing in the months ahead.

Still, they noted that after Vans' popularity overall took off from 2015 to 2020, the brand had stopped marketing to the younger people that made up its core customers.

"More celebrities started to wear them," Chief Executive Bracken Darrell said at the time. "Moms bought them for their kids, and we actually took our eye off the core youth audience that had been the lifeblood of Vans. The brand had to evolve, but rather than continue to respect and serve the youth audience that had built the brand, we only fed the trend that grew it rapidly."

"We largely withdrew marketing to the core youth, and instead focused on everyone else," Darrell continued. "We extended our lineup to lower price points in value stores and we offered more and more color waves of the same old things to pour more fuel into a fire built on a trend. The trend fuel burned out 18 months ago. The trend moved on."

-Bill Peters

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05-22-24 2023ET

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