Cherokee Inc. said Wednesday its first quarter net income fell 18 percent due both to a stronger dollar and weaker demand for its licensed apparel.

The Van Nuys company reported net income of $3.8 million (43 cents) for the quarter ended May 2, compared with $4.7 million (52 cents) a year ago. Revenue fell 23 percent to $8.9 million from $11.5 million.

The stronger dollar dampened revenue by 7 cents per share as royalties from international licensees fell, the company said. In the United States, slower sales of Cherokee adult clothing at Target stores and the loss of major customer Mervyn’s, which was liquidated, were partially offset by growth in Target’s children’s clothing business and the Carole Little adult line sold at TJX.

“Although we are not pleased with our first quarter revenue results, we are pleased with our prudent expense management and are very certain that our sales teams are focused on some exciting growth opportunities,” said Chief Executive Robert Margolis in a statement.

The company expects to see growing revenue from the Cherokee brand in Brazil, Chile, Peru and India, along with continued growth of Norma Kamali line domestically at Wal Mart. An upcoming launch in Spain with partner Eroski in the second half of the year also should add to royalty revenues.

Shares closed down 28 cents, or 1.4 percent, to $19.60 on the Nasdaq.