Bracken Darrell
President and Chief Executive Officer at VF
Thank you, Paul. In addition to Paul's recent start, I'm also excited that as of last Monday, Sanjay [Phonetic] is now officially the President of Vans, we're leaving me of that job and Caroline Brown is two months into leading the North Face. I'm excited about the progress we're seeing from our Chief Strategy and Transformation Officer and our Chief Design Officer, both of whom joined in March and are working away on things you'll see later. Nina Flood was promoted into the Timberland rolls just six months ago. And Martino Scabbia Guerrini has run the newly created global commercial organization since we created it nine months ago. In other words, we have a full team now and you can feel the energy.
Now for Reinvent; while we're not yet back to growth the steps we're taking now will get us there. Remember, this phase is about reducing costs, lowering our debt, resetting the U.S. business and getting Vans back on track. First, there's a significant potential to improve our profitability, as we all know. During the quarter, we generated a further $50 million in cost savings, part of our $300 million target. We will have executed all actions to deliver $300 million cost savings by the end of the first half of the year, as we guided and the impact will be fully reflected in the P&L by the end of the fiscal year. And we have no intention of stopping there.
As we said from the beginning, we're reinvesting some of that back into the business in the key areas of product and brand building. And those savings are further offset by rebuilding of our annual incentive program and inflation on salaries and other areas. But as I said before, we are absolutely committed to more cost reduction, as you'll hear more about. We continue to reduce debt and strengthen our balance sheet. We delivered another significant reduction in inventories relative to last year. Even as we build ahead of our peak selling season. Inventories at the end of the quarter were down 24% versus last year or $676 million.
Additionally, net debt is down $587 million year-over-year, supporting our plan to delever. Last quarter, I told you our strategic portfolio review is complete. I also said we would provide you an update and we had some news. We announced the sales of Supreme for $1.5 billion 3 weeks ago. To be clear, I love the Supreme Brand and I love the Supreme team. It's back to strong profitable growth. But the lack of synergies with the rest of our organization made us a clear choice for divestiture. This allows us to sharpen focus on the core business and also improve our leverage.
Turning to the Americas; our platform is now fully operational. As expected, the Americas continues to perform well below our potential but the decline softened from negative 23% last quarter to negative 12% in Q1. Almost as important to me near term, we continue to be able to forecast the business. We now have 8 consecutive months of accurate forecast. Moving to Vans; we said the first quarter of this year would be similar to the fourth quarter last year, excluding the impact from inventory reset actions.
And we actually did a little better than that with some modest improvement. Down 21% in Q1 versus 27% in Q4, reflecting an improved trend in its two biggest regions. Importantly, while the headline numbers remain weak, several indicators are showing we're head in the right direction. EMEA is once again the region which is showing clear early encouraging signs with wholesale up in the quarter for the first time in 6 quarters with particularly positive momentum in key accounts.
As a result of the inventory reset actions, our markets are clean and we have space to introduce our new products which are performing well across regions. The Knu Skool continued to gain momentum and is performing well across regions and is now the number 2 franchise globally. Other more recently introduced products are also gaining traction, including our advanced Skate shoe, AVE 2.0 and UltraRange Neo and we've launched several new styles in July.
As part of our brand elevation strategy, we advanced our off-the-wall collections and billing a new collaboration with Broze Knu Schooler [Phonetic] showing the depth and breadth of our brand's potential. And with all the excitement and buzz around events in Paris this summer, we had our own event just beforehand, during Paris Fashion Week, where we started with a Paris takeover in June with a set of grassroots activations combined with events in music, art and design. Finishing off of a disruptive moment when we took over the iconic Saraco to showcase OTW and Van's authentic skate culture. We have over 20 sponsored athletes across skateboarding and [Indecipherable] at the Paris games.
In fact, just today, we won gold and silver in today's women's skate event. We leverage this exciting time to launch our always pushing campaign globally, featuring our top athletes in Paris, Tokyo and New York. These new products and marketing efforts are resonating with consumers and contributing to further progress in Google search trends which continue to move in the right direction across our markets.
Now, let me give you a quick overview of the first quarter. Revenue was down 8% which was a little better than expected, demonstrating slight sequential improvement versus Q4 with the trend line improvement across almost all brands. Now this is our smallest quarter of the fiscal year and largely skewed towards the Americas and wholesale. It's worth noting that growth in our DTC business was in line with last quarter if you exclude Vans. Note, in Vans, we're closing unprofitable stores and nonstrategic ones, dampening our growth even further. The North Face was down 2% with growth in DTC up 8% globally with positive performance across each of the 3 regions, displaying continued strong brand health, whereas wholesale was down on a global basis. Across both channels and regionally, the standout continues to be APAC which grew strongly, up 35%, even as we comped the post-COVID opening quarter last year.
Moving down to P&L. Gross margin was down 80 basis points for the prior year, in line with the guardrails we gave you in May. To quickly remind you, this is primarily driven by the continued impact of our clear out activities from the Vans product we took back in our reset. Our operating margin was down 360 basis points, largely driven by SG&A deleverage. I'd like to note our SG&A dollars were down year-over-year. And I'd also like to say absolutely detest delevering a P&L. So you can be assured we are not at all finished reducing SG&A even as we invest in our own growth turn. As a result, Q1 loss per share was negative $0.33 as expected.
Looking ahead to Q2, let me provide some guardrails for that quarter. These are all excluding Supreme, both from this year and last year. The overall Q2 revenue trend is expected to show modest improvement versus Q1, in line with our comments in May. Don't get me wrong, we're not back in growth yet but the decline rate should continue to moderate. And to give you some additional color on our 2 biggest brands, at Vans, we will see modest sequential improvement as we did this quarter. For the North Face, we expect Q2 revenue to be slightly down relative to Q1 but remember, T&F had 17% growth in Q2 of last year.
Turning to gross margin; we expect this to be up slightly in Q2 versus last year. Inventory quality has improved, so there's less impact from the flushing of inventory post Vans reset.
On SG&A, let me spend a little time breaking this down further. First, Reinvent savings are on track. Second, we will have realized incentive compensation as well as inflation as we indicated before. We also consistently said we'll reinvest 25% to 30% of our gross savings. As we head into our holiday season, I decided to pull some of that forward and appears -- it begins to appear in Q2. To be clear, this is not the end of our cost story. Expenses in Q2 are expected to be up slightly year-over-year.
This, combined with further revenue declines will lead to a higher rate of deleverage in Q2 but we will have more to say about that in October which I'll explain in just a moment. Moving into fiscal year '25; we're on-track to deliver guidance for free cash flow plus the proceeds from noncore physical asset sales of about $600 million. This excludes the impact of the divestiture of Supreme. We expect the Supreme divestiture to be completed at some point by the end of the calendar year.
Finally, to conclude, we continue to make progress. The quarter improved sequentially relative to Q4 across almost all our brands. We're advancing on Reinvent. Cost savings are on track and we're committed to more cost reduction. We're addressing the balance sheet leverage ratio with the first sale of spring. The new platform in the Americas is moving strongly in the right direction and advance we're seeing progress we expected. My level of confidence has never been higher. We have an incredible leadership team and dedicated talent at VF. So together, we will make the continued progress on our path to deliver strong, sustainable growth and value creation at VF.
To close, I've dropped a few hints about our longer-term plan, so let me clarify. I'm excited to announce we'll be hosting a 2-part investor event. Part one will be, mark your calendars, October 30 in New York, live and of course, as well as webcast. Focused on broader VF strategy and laying out the building box for a return to value creation. And we'll build on that in part 2 or the second part toward the end of the fiscal year which will focus on our brand and commercial strategies.
With that, I'll now open the line for questions.
