Skinny jeans are out and wide-leg denim is in vogue. The world is in a new denim cycle, Levi's CEO says

Source: Levi's

Bye-bye skinny jeans, hello "mom jeans."

The world might finally be entering into the early stages of a new denim cycle. One where tight-fitting pants are suddenly out of style, and instead shoppers young and old are flocking to loose-hanging, wide-leg and flared jeans, according to the CEO of Levi's. It harkens back to a fashion trend that was especially prolific in the 1990s.

"This is not the first time we've seen this resonating with consumers," Levi Strauss & Co. CEO Chip Bergh told CNBC Thursday, about the more loose-fitting denim styles. "Cycles do come and go. And I think the pandemic definitely played a contributing role to consumers looking for a more comfortable, more relaxing denim."

Bergh said Levi's started to notice an uptick in sales in these new styles of jeans when it launched two different fits early on last year: One pair of jeans that ballooned out at the bottom, and another that was high-rise at the waist and loose fitting.

"They're definitely taking off, and it is definitely a new trend," Bergh said about the jeans, for both females and males.

The shift has been driven in large part by younger consumers. Gen Z is all for the so-called mom jeans. Today, the style is all over teens' favorite websites, including Shein, Princess Polly, Urban Outfitters and Revolve.

In Piper Sandler's biannual "Taking Stock with Teens" survey, released on Wednesday, "mom jeans" ranked as the No. 3 fashion trend for apparel among female teens. Baggy or saggy pants ranked No. 2, behind leggings.

A separate note from UBS' retail team earlier this week noted how fashion trends within the denim category are shifting. It recently completed a global, Google search analysis that found a significant spike in browsing online in Jan. 2021 compared with Jan. 2020 for new jean styles, including "baggy/wide jeans" and "straight jeans," while searches for "skinny jeans" were less robust.

"Some people have said that this is going to create a new denim cycle, and we think that that could very well be true," Bergh told CNBC. "The last real denim cycle was driven by skinny jeans. And that cycle lasted about 10 years."

"I don't think skinny jeans are ever going to go away completely," he went on. "But clearly right now we are seeing a very strong demand for these looser fits, both the men's side of the business, as well as the women's side of the business."

Earlier Thursday, Levi's reported a double-digit sales decline for its fiscal first quarter, as ongoing store closures in Europe and weaker foot traffic in the U.S. due to the Covid pandemic weighed on results.

But the denim maker boosted its sales and profit outlook for the first half of the year, assuming the global health crisis doesn't become worse from here. CFO Harmit Singh said in an interview with CNBC that the company is anticipating sales will return to 2019, pre-pandemic levels by the fourth quarter.

Levi's shares are up nearly 25% year to date, as of market close Thursday. The company has a market cap of $10 billion.

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