The first-quarter outlook for Victoria's Secret is dismal, with the company citing the Ukraine war and inflation as factors.

• After issuing a downbeat outlook for the upcoming quarter, Victoria's Secret experienced a seesaw in after-hours trading on Wednesday.
• The sentence can be rewritten as: "Inflation and global unrest, particularly the conflict between Russia and Ukraine, pose significant challenges."

After the lingerie retailer issued a downbeat outlook for the coming quarter, cautioning that it still sees challenges ahead, including inflation and "global unrest," which refers to Russia's war on Ukraine, the stock sawawed in after-hours trading on Wednesday.

The company reported slightly better-than-expected fiscal fourth-quarter profits and sales, following its December reaffirmation of holiday performance forecast.

The future performance of Victoria's Secret may be uncertain due to global headwinds, but the company expects to return to operating income growth in the second half of this year. Victoria's Secret considers the third quarter as an expected turning point.

In its fiscal fourth quarter, Victoria's Secret performed better than expected, according to a survey of analysts by Refinitiv.

• Earnings per share: $2.70 vs. $2.63 expected
• Revenue: $2.18 billion vs. $2.14 billion expected

The net income for the three-month period ended Jan. 29 decreased from $282 million to $246 million, while revenue increased by approximately 4% from $2.1 billion to $2.18 billion.

The company's beauty merchandise has helped drive customers online and into its brick-and-mortar stores, and its international business has reported outsize growth compared with North American operations. Additionally, Victoria's Secret has been pleased with the recent launch of its new Love Cloud collection, which focuses on comfort and inclusivity.

In the upcoming months, Victoria's Secret anticipates a challenging retail climate due to increasing inflation and the possibility of consumer uncertainty resulting from global unrest.

The company anticipates an increase in supply chain costs and expenses due to inflation in the first half of the year, which is estimated to be around $140 million, similar to the amount reported in the second half of 2021. The surge in oil prices resulting from Russia's invasion of Ukraine has caused concerns that inflation, which is already high, may rise at an even faster rate.

The retailer anticipates first-quarter sales to be between $1.43 billion and $1.5 billion, which is a 4% to 8% decrease from the previous year. This falls short of analysts' predictions of $1.52 billion.

The company's first-quarter earnings per share are expected to fall between 70 cents and 95 cents, which is lower than the $1.32 analysts had anticipated, according to Refinitiv.

The retailer stated in its prepared remarks that it anticipates ongoing supply chain cost pressures and will benefit from approximately $50 million in stimulus benefits in the first quarter of 2021.

Analysts had predicted a 2.9% increase in revenue year over year, but now anticipate 2022 revenue to be flat to up low-single digits compared with 2021 levels.

Victoria's Secret is evaluating the size of its real estate footprint by testing an off-mall concept and remodeling existing shops to make them more inviting for shoppers. The company anticipates closing between 10 and 30 shops in 2022.

Management stated in prepared remarks that there is a positive response to newness and maintaining a lower level of promotional activity.

As of Wednesday's market close, Victoria's Secret shares have decreased by approximately 2% this year, resulting in a market capitalization of $4.8 billion.

The company will hold a live conference call with analysts on Thursday morning.