L Brands beat on both the top and bottom lines.
The retailer cut its full-year guidance for a second time this year.
The CEO of Victoria's Secret Pink will retire and be replaced by a leader from Bath & Body Works.
Shares are down 9% in early trading on Thursday.
L Brands, the owner of Victoria's Secret, is trading lower by 9% early Thursday after beating on both the top and bottom lines, but cutting its full-year guidance for a second time this year. The retailer also announced the retirement of Denise Landman, the CEO for Victoria's Secret Pink brand, which has been going through a rough patch.
L Brands reported net sales of $2.98 billion for the second quarter, slightly beating the $ 2.96 billion that was expected by analysts surveyed by Bloomberg. It's earnings of $0.36 a share edged out the $0.35 that was anticipated.
But L Brands cut its guidance for full-year earnings per share to $2.45 to $2.70 from $2.70 to $3.00. It had previously lowered its EPS guidance from $2.95 to $3.25.
"With LB cutting the FY guide for the 2nd time this year (a dynamic not seen in years, Fig 9), the issues at the business are hard to ignore," a team at Nomura Instinet wrote on Wednesday. "2Q raised a number of red flags (severe margin contraction at LB, bloated inventory, BBW returning to margin contraction and critically issues at PINK are proving hard to ignore)."
The lowered outlook comes the company's Victoria's Secret brand — and specifically its Pink segment — has been losing pricing power as it extends promos to customers.
And on Thursday, the company announced Pink CEO Denise Landman will retire at the end of the year and be replaced by Amy Hauk, head of merchandising and product development at Bath & Body Works.
With a leadership change, PINK won't be a quick fix, a group of Jefferies analysts led by Randal Konik said in a note sent out to clients on Wednesday.
"We question whether an exec without apparel expertise is the right person to lead PINK at a time when merch and brand issues need to be corrected," the team — which has a price target of $23, 30% below where shares are currently trading — said while maintaining its "underperform" rating.
L Brands shares were down 46% this year through Wednesday.