Victoria's Secret shares spike 40% after big earnings beat, raised sales outlook

Shoppers may be feeling gloomy about high prices at the pump, but they're still shelling out for new bras and underwear at Victoria's Secret .

The lingerie retailer raised its full-year guidance on Tuesday after blowing past earnings estimates in its fiscal first quarter, citing lower tariff costs and more customers willing to spend full price on its products. Shares of Victoria's Secret closed 47% higher.

There was "very consistent, double-digit [sales] increases across Victoria's Secret, Pink, beauty channels, digital, stores and international, all very positive," CEO Hillary Super told CNBC in an interview. "Supercharging bras being one of our most important initiatives, double-digit [comparable sales growth] there, and I think the loyalty that bras creates and the anchor that it is in the business is just so important."

Super added the company grew sales with "significantly" fewer promotions and gained market share during the quarter, particularly with shoppers ages 18 to 24.

During the first quarter, some retailers saw strong growth that they attributed partially to higher tax refunds . While Victoria's Secret finance chief Scott Sekella said some customers used that extra stimulus to go shopping at its stores, it was a "normal amount," and trends have remained consistent so far this quarter, even with tax refunds having dried up for many people.

Victoria's Secret is now expecting full-year sales to be between $7.03 billion and $7.13 billion, up from a previous range of between $6.85 billion to $6.95 billion and well ahead of estimates of $6.99 billion, according to LSEG.

The company also raised its full-year guidance for adjusted opening income by more than $100 million. It's now expecting adjusted operating income to be between $550 million and $580 million, up from a previous range of between $430 million to $460 million.

Sekella said the company hiked its outlook because better-than-expected sales led to stronger leverage on fixed costs, and it also factored in lower tariff rates now that many of President Donald Trump 's sweeping duties have been ruled illegal.