The latest announcement from Kontoor Brands confirms that Wrangler’s retail expansion in Texas will soon include more stores, reinforcing the brand’s emphasis on a direct-to-consumer (DTC) model. This development follows an impressive second quarter, largely attributed to the positive impact of the Helly Hansen acquisition. Despite the momentum, some analysts remain skeptical about whether sustained expansion is feasible.
DTC Rollout in Texas: Wrangler Plans More Locations
Building upon the strong performance of its full-price store located in Fort Worth’s historic stockyards, Wrangler is preparing to introduce two additional stores in Texas at the start of 2025. CEO Scott Baxter presented this move as the foundational phase of his goal to establish a strategic cluster of retail stores deep in “Wrangler Country,” reaffirming the company’s increasing focus on direct-to-consumer sales. Baxter emphasized the promising outlook across DTC operations, women’s apparel, and non-denim lines, while also committing to preserving Wrangler’s hallmark style.
In the women’s category, Wrangler recorded an impressive 20% surge in the first half of the year, with results quickening even more in the second quarter. The core bottoms segment gained market share, increasing by over 100 basis points, according to Circana figures cited by Baxter.
Helly Hansen Acquisition Drives Q2 Gains Amid Skepticism
During the second quarter, Kontoor Brands achieved revenue of $584 million, representing a 19% rise from the same period last year. This was powered by a $114 million contribution from the recently acquired Helly Hansen outdoor brand, which finalized its sale in late May 2025—making this the first quarter to reflect Helly Hansen’s results. Worldwide revenue for Wrangler climbed to $469 million, a 2% yearly increase. The figures do not include Lee, the heritage denim label, which is expected to transfer to Authentic Brands Group in the fourth quarter, nor do they make allowances for anticipated tariff refunds.
The quarter’s highlights also feature a gross margin improvement of 970 basis points to 56.2%, and net income of $64.8 million, which is 12% below that of the prior year. Favorable foreign exchange rates benefited both Wrangler and Helly Hansen. In constant currencies, Wrangler’s gain was 1%, while Helly Hansen saw a marginal 1% dip, based on analysis by Laurent Vasilescu, senior analyst for BNP Paribas Equity Research.
Nevertheless, Vasilescu raised concerns over Helly Hansen’s “growth engine” classification by Kontoor management, referencing disclosures suggesting the brand’s growth remains nearly flat.
Strategic Moves and Analyst Critiques
Kontoor expects both Helly Hansen and Wrangler to report mid-single digit revenue increases during the latter half of the year, excluding adjustments due to the 53rd week. The company continues to project 12% to 13% year-over-year revenue growth for 2025. Still, Vasilescu warned that Helly Hansen’s sales could face headwinds if a mild winter, caused by El Niño, reduces customer demand for outdoor wear.
This ramp-up in DTC mirrors approaches taken by major players like Nike and Levi’s, though the outcomes in the market have been varied. While Nike has reduced its DTC ambitions due to lackluster sales, Crocs and Levi’s remain committed to DTC, but still uphold robust wholesale partnerships.
Management Shifts
Alongside its earnings report, Kontoor promoted Joseph Alkire, who has served as Chief Financial Officer for three years, to additionally become president of the company. Alkire will now oversee both financial operations worldwide and take on greater oversight of the Helly Hansen and Wrangler businesses, based on the official press statement.
With new Wrangler store openings and the integration of Helly Hansen underway, Kontoor Brands continues its DTC expansion, expressing ongoing optimism for growth prospects—even as analysts voice caution and weather remains a wildcard for the company’s outdoor segment.