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International Markets and Abercrombie (ANF): A Deep Dive for Investors
ZACKS· 2025-09-01 14:15
Core Insights - Abercrombie & Fitch's international operations are crucial for understanding its financial resilience and growth potential [1][2] - The company's total revenue for the recent quarter reached $1.21 billion, reflecting a 6.6% increase from the previous year [4] International Revenue Breakdown - Revenue from Europe, Middle East, and Africa was $197.21 million, accounting for 16.3% of total revenue, which was a surprise of -4.51% compared to the consensus estimate [5] - Asia Pacific contributed $37.15 million, or 3.1% of total revenue, exceeding expectations by +2.65% [6] Future Revenue Projections - Analysts project total revenue of $1.29 billion for the ongoing fiscal quarter, a 6.3% increase year-over-year, with expected contributions of $188.51 million from Europe, Middle East, and Africa and $43.45 million from Asia Pacific [7] - For the full year, total revenue is expected to reach $5.24 billion, marking a 5.9% increase, with contributions of $813.87 million from Europe, Middle East, and Africa and $160.7 million from Asia Pacific [8] Conclusion on International Presence - The reliance on foreign markets presents both opportunities and challenges for Abercrombie, making it essential to monitor international revenue trends for future projections [9][10]
A&F(ANF) - 2026 Q2 - Quarterly Results
2025-08-28 20:54
[Executive Summary & Highlights](index=1&type=section&id=Executive%20Summary%20%26%20Highlights) This section highlights Abercrombie & Fitch Co.'s strong Q2 fiscal 2025 performance, record sales, and increased full-year outlook [Q2 Fiscal 2025 Performance Highlights](index=1&type=section&id=Q2%20Fiscal%202025%20Performance%20Highlights) Abercrombie & Fitch Co. achieved record Q2 net sales of $1.2 billion, up 7% YoY, driven by Hollister's 19% growth and strong profitability - Achieved 11th consecutive quarter of growth with **record net sales of $1.2 billion**, up **7% YoY**, exceeding outlook[5](index=5&type=chunk) Q2 Fiscal 2025 Key Performance Indicators | Metric | Q2 Fiscal 2025 | Q2 Fiscal 2024 | YoY Change | | :-------------------------------- | :------------- | :------------- | :--------- | | Net Sales | $1.2 billion | $1.13 billion | +7% | | Operating Margin (Reported) | 17.1% | 15.5% | +1.6 pp | | Operating Margin (Adjusted non-GAAP) | 13.9% | 15.5% | -1.6 pp | | Diluted EPS (Reported) | $2.91 | $2.50 | +$0.41 | | Diluted EPS (Adjusted non-GAAP) | $2.32 | $2.50 | -$0.18 | - Net sales growth was led by Americas (**+8%**) and APAC (**+12%**), partially offset by a **1% decline in EMEA**; Hollister brands achieved its best-ever Q2 net sales with **19% growth**, while Abercrombie brands were down **5%**[5](index=5&type=chunk) - Q2 operating margin and EPS included a **$39 million pre-tax litigation settlement benefit** (**$0.59 per share benefit** on a tax-adjusted basis); excluding this, adjusted operating margin was **13.9%** and adjusted EPS was **$2.32**, exceeding outlook[5](index=5&type=chunk) [CEO Commentary](index=1&type=section&id=CEO%20Commentary) CEO Fran Horowitz highlighted record Q2 net sales, driven by Hollister's 19% growth, exceeding profitability, and an increased full-year outlook - Delivered **record second quarter net sales**, exceeding expectations with **7% growth**[3](index=3&type=chunk) - Hollister brands grew **19%** due to strong summer and back-to-school demand, while Abercrombie brands net sales were down **5%**, lapping **26% growth** in the prior year[3](index=3&type=chunk) - Exceeded second quarter profitability expectations and returned **$50 million to shareholders** through share repurchases[3](index=3&type=chunk) - Increased full-year net sales outlook, reflecting strong positioning and growth trajectory, and remains focused on investing in long-term global brand opportunities[4](index=4&type=chunk) [Second Quarter Fiscal 2025 Financial Results](index=2&type=section&id=Second%20Quarter%20Fiscal%202025%20Financial%20Results) This section details Abercrombie & Fitch Co.'s Q2 fiscal 2025 net sales, profitability, and earnings per share performance [Net Sales Performance](index=2&type=section&id=Net%20Sales%20Performance) Total net sales for Q2 fiscal 2025 increased 7% to $1.21 billion, with comparable sales growing 3% Q2 Fiscal 2025 Net Sales Overview | Metric | Q2 Fiscal 2025 | Q2 Fiscal 2024 | 1 YR % Change | Comparable Sales | | :------- | :------------- | :------------- | :------------ | :--------------- | | Net Sales | $1,208,560 | $1,133,974 | 7% | 3% | [Net Sales by Segment](index=2&type=section&id=Net%20Sales%20by%20Segment) This section presents Q2 fiscal 2025 net sales performance broken down by geographic segment Q2 Fiscal 2025 Net Sales by Segment (in thousands) | Segment | Q2 Fiscal 2025 (in thousands) | Q2 Fiscal 2024 (in thousands) | 1 YR % Change | Comparable Sales | | :------ | :---------------------------- | :---------------------------- | :------------ | :--------------- | | Americas | $974,200 | $901,224 | 8% | 5% | | EMEA | $197,210 | $199,682 | (1)% | (5)% | | APAC | $37,150 | $33,068 | 12% | 1% | [Net Sales by Brand Family](index=2&type=section&id=Net%20Sales%20by%20Brand%20Family) This section details Q2 fiscal 2025 net sales performance for Abercrombie and Hollister brand families Q2 Fiscal 2025 Net Sales by Brand Family (in thousands) | Brand Family | Q2 Fiscal 2025 (in thousands) | Q2 Fiscal 2024 (in thousands) | 1 YR % Change | Comparable Sales | | :----------- | :---------------------------- | :---------------------------- | :------------ | :--------------- | | Abercrombie | $551,868 | $582,416 | (5)% | (11)% | | Hollister | $656,692 | $551,558 | 19% | 19% | [Profitability Metrics](index=5&type=section&id=Profitability%20Metrics) Q2 fiscal 2025 reported operating income increased to $206.7 million (17.1% of net sales), with adjusted operating income at 13.9% Q2 Fiscal 2025 Operating Income and Margin | Metric | Q2 Fiscal 2025 (Reported) | % of Net Sales | Q2 Fiscal 2024 | % of Net Sales | | :---------------- | :------------------------ | :------------- | :------------- | :------------- | | Operating Income | $206,658 | 17.1% | $175,625 | 15.5% | | Operating Income (Adjusted non-GAAP) | $168,084 | 13.9% | $175,625 | 15.5% | [Earnings Per Share](index=5&type=section&id=Earnings%20Per%20Share) Q2 fiscal 2025 diluted EPS was $2.91, increasing from $2.50, with adjusted non-GAAP diluted EPS at $2.32 Q2 Fiscal 2025 Diluted Net Income Per Share | Metric | Q2 Fiscal 2025 | Q2 Fiscal 2024 | | :-------------------------------- | :------------- | :------------- | | Diluted Net Income Per Share (GAAP) | $2.91 | $2.50 | | Diluted Net Income Per Share (Adjusted non-GAAP) | $2.32 | $2.50 | [Financial Position and Liquidity](index=2&type=section&id=Financial%20Position%20and%20Liquidity) This section provides an overview of the company's balance sheet, cash flow, and capital allocation strategies [Balance Sheet Overview](index=12&type=section&id=Balance%20Sheet%20Overview) As of August 2, 2025, total assets were $3.30 billion, with cash and equivalents at $572.7 million and total stockholders' equity at $1.31 billion Selected Balance Sheet Items (in thousands) | Item | August 2, 2025 | February 1, 2025 | August 3, 2024 | | :-------------------------------- | :------------- | :--------------- | :------------- | | Cash and equivalents | $572,730 | $772,727 | $738,402 | | Marketable securities | $30,795 | $116,221 | $15,014 | | Inventories | $592,966 | $575,005 | $539,759 | | Total current assets | $1,489,115 | $1,673,431 | $1,516,653 | | Total assets | $3,301,941 | $3,299,887 | $3,049,558 | | Total current liabilities | $1,038,041 | $1,126,944 | $1,051,656 | | Total long-term liabilities | $956,696 | $821,620 | $776,752 | | Total stockholders' equity | $1,307,204 | $1,351,323 | $1,221,150 | [Cash Flow and Capital Allocation](index=2&type=section&id=Cash%20Flow%20and%20Capital%20Allocation) Year-to-date net cash from operations decreased to $113 million, with $250 million used for share repurchases and total liquidity at $1.0 billion Year-to-Date Cash Flow Activities (in thousands) | Activity | YTD August 2, 2025 | YTD August 3, 2024 | | :-------------------------------- | :----------------- | :----------------- | | Net cash provided by operating activities | $112,893 | $260,119 | | Net cash used for investing activities | $(31,943) | $(96,649) | | Net cash used for financing activities | $(290,713) | $(326,961) | - Repurchased **3.2 million shares for $250 million** year-to-date, representing a **7% reduction** in shares outstanding; **$1.05 billion** remains on the share repurchase authorization[8](index=8&type=chunk) - Total liquidity (cash and equivalents plus available borrowing capacity) was approximately **$1.0 billion** as of August 2, 2025[10](index=10&type=chunk) [Fiscal 2025 Outlook](index=3&type=section&id=Fiscal%202025%20Outlook) This section outlines the company's updated financial projections for the full fiscal year 2025 and the upcoming third quarter [Full Year Outlook](index=3&type=section&id=Full%20Year%20Outlook) The company increased its full-year fiscal 2025 net sales growth outlook to 5-7%, with operating margin projected at 13.0-13.5% and EPS at $10.00-$10.50 Fiscal 2025 Full Year Outlook Comparison | Metric | Current Full Year Outlook | Previous Full Year Outlook | Change | | :-------------------------- | :------------------------ | :----------------------- | :----- | | Net sales growth | 5% to 7% | 3% to 6% | Increased | | Operating margin | 13.0% to 13.5% | 12.5% to 13.5% | Increased lower end | | Effective tax rate | Around 30% | Around 27% | Increased | | Net income per diluted share | $10.00 to $10.50 | $9.50 to $10.50 | Increased lower end | | Share repurchases | Around $400 million | $400 million | No change | | Capital expenditures | ~$225 million | ~$200 million | Increased | - The full-year outlook includes an estimated **$90 million of net tariff expense** (**170 basis points** as a percent of net sales) and a **$39 million pre-tax benefit** from a litigation settlement[11](index=11&type=chunk) [Third Quarter Outlook](index=3&type=section&id=Third%20Quarter%20Outlook) For Q3 fiscal 2025, net sales growth is expected to be 5-7%, with operating margin at 11-12% and diluted EPS at $2.05-$2.25 Fiscal 2025 Third Quarter Outlook | Metric | Third Quarter Outlook | | :-------------------------- | :-------------------- | | Net sales growth | 5% to 7% | | Operating margin | 11% to 12% | | Effective tax rate | Around 31% | | Net income per diluted share | $2.05 to $2.25 | | Share repurchases | At least $50 million | [Non-GAAP Financial Measures and Reconciliations](index=7&type=section&id=Non-GAAP%20Financial%20Measures%20and%20Reconciliations) This section explains the company's non-GAAP financial measures and provides reconciliations to GAAP results for various periods [Explanation of Non-GAAP Measures](index=7&type=section&id=Explanation%20of%20Non-GAAP%20Measures) The company utilizes non-GAAP measures like comparable sales, constant currency, EBITDA, and Adjusted EBITDA to clarify operating performance and comparability - Non-GAAP measures are used to evaluate performance, manage operations, and provide a clearer understanding of comparability across periods by excluding certain items not reflecting future operating outlook[24](index=24&type=chunk) - **Comparable sales** are defined as the year-over-year percentage change in sales for stores open at least one year (without significant square footage changes) and digital net sales, both converted at current year's foreign currency exchange rates[25](index=25&type=chunk) - **Constant currency basis** removes the impact of foreign currency exchange rate fluctuations by applying current year average exchange rates to prior year results[26](index=26&type=chunk) - **EBITDA** is net income before interest, income taxes, depreciation, and amortization; **Adjusted EBITDA** further adjusts EBITDA for specific items like litigation settlements[27](index=27&type=chunk)[37](index=37&type=chunk) [Reconciliation of GAAP to Adjusted Non-GAAP (Q2)](index=8&type=section&id=Reconciliation%20of%20GAAP%20to%20Adjusted%20Non-GAAP%20(Q2)) This section reconciles Q2 fiscal 2025 GAAP results to adjusted non-GAAP figures, excluding a $38.6 million litigation settlement Q2 Fiscal 2025 GAAP to Adjusted Non-GAAP Reconciliation (in thousands) | Metric | GAAP | Excluded item (Litigation settlement) | Adjusted non-GAAP | | :-------------------------------- | :----- | :------------------------------------ | :---------------- | | Operating income | $206,658 | $38,574 | $168,084 | | Income before income taxes | $209,132 | $38,574 | $170,558 | | Net income attributable to A&F | $141,383 | $28,625 | $112,758 | | Net income per diluted share attributable to A&F | $2.91 | $0.59 | $2.32 | [Reconciliation of GAAP to Adjusted Non-GAAP (YTD)](index=9&type=section&id=Reconciliation%20of%20GAAP%20to%20Adjusted%20Non-GAAP%20(YTD)) This section reconciles year-to-date fiscal 2025 GAAP results to adjusted non-GAAP figures, excluding a $38.6 million litigation settlement YTD Fiscal 2025 GAAP to Adjusted Non-GAAP Reconciliation (in thousands) | Metric | GAAP | Excluded item (Litigation settlement) | Adjusted non-GAAP | | :-------------------------------- | :----- | :------------------------------------ | :---------------- | | Operating income | $308,191 | $38,574 | $269,617 | | Income before income taxes | $317,448 | $38,574 | $278,874 | | Net income attributable to A&F | $221,796 | $28,625 | $193,171 | | Net income per diluted share attributable to A&F | $4.47 | $0.58 | $3.90 | [Reconciliation of Constant Currency Financial Measures (Q2)](index=10&type=section&id=Reconciliation%20of%20Constant%20Currency%20Financial%20Measures%20(Q2)) This section reconciles Q2 fiscal 2025 financial measures to a constant currency basis, showing a 6% net sales change Q2 Fiscal 2025 Constant Currency Reconciliation (in thousands) | Metric | Q2 Fiscal 2025 (GAAP) | Q2 Fiscal 2024 (GAAP) | Impact from FX | Q2 Fiscal 2024 (Constant Currency) | % Change (Constant Currency) | | :-------------------------------- | :-------------------- | :-------------------- | :------------- | :--------------------------------- | :--------------------------- | | Net sales | $1,208,560 | $1,133,974 | $10,707 | $1,144,681 | 6% | | Operating income (Adjusted non-GAAP) | $168,084 | $175,625 | $2,272 | $177,897 | (160) BPS | | Net income per diluted share (Adjusted non-GAAP) | $2.32 | $2.50 | $0.03 | $2.53 | $(0.21) | [Reconciliation of EBITDA and Adjusted EBITDA (Q2)](index=11&type=section&id=Reconciliation%20of%20EBITDA%20and%20Adjusted%20EBITDA%20(Q2)) This section reconciles Q2 fiscal 2025 EBITDA and Adjusted EBITDA, with Adjusted EBITDA at $205.5 million (17.0% of net sales) Q2 Fiscal 2025 EBITDA and Adjusted EBITDA (in thousands) | Metric | Q2 Fiscal 2025 | % of Net Sales | Q2 Fiscal 2024 | % of Net Sales | | :---------------- | :------------- | :------------- | :------------- | :------------- | | Net income | $143,388 | 11.9% | $135,379 | 11.9% | | EBITDA | $244,082 | 20.2% | $214,980 | 19.0% | | Adjusted EBITDA | $205,508 | 17.0% | $214,980 | 19.0% | [Reconciliation of EBITDA and Adjusted EBITDA (YTD)](index=11&type=section&id=Reconciliation%20of%20EBITDA%20and%20Adjusted%20EBITDA%20(YTD)) This section reconciles year-to-date fiscal 2025 EBITDA and Adjusted EBITDA, with Adjusted EBITDA at $345.6 million (15.0% of net sales) YTD Fiscal 2025 EBITDA and Adjusted EBITDA (in thousands) | Metric | YTD Fiscal 2025 | % of Net Sales | YTD Fiscal 2024 | % of Net Sales | | :---------------- | :-------------- | :------------- | :-------------- | :------------- | | Net income | $225,127 | 9.8% | $250,457 | 11.6% | | EBITDA | $384,191 | 16.7% | $382,518 | 17.8% | | Adjusted EBITDA | $345,617 | 15.0% | $382,518 | 17.8% | [Consolidated Financial Statements](index=5&type=section&id=Consolidated%20Financial%20Statements) This section presents the company's condensed consolidated statements of operations, balance sheets, and cash flows [Condensed Consolidated Statements of Operations (Q2)](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations%20(Q2)) This section presents Q2 fiscal 2025 condensed consolidated statements of operations, showing $1.21 billion in net sales and $2.91 diluted EPS Q2 Fiscal 2025 Condensed Consolidated Statements of Operations (in thousands) | Item | August 2, 2025 | % of Net Sales | August 3, 2024 | % of Net Sales | | :------------------------------------------ | :------------- | :------------- | :------------- | :------------- | | Net sales | $1,208,560 | 100.0% | $1,133,974 | 100.0% | | Cost of sales, exclusive of D&A | $451,590 | 37.4% | $397,712 | 35.1% | | Operating income | $206,658 | 17.1% | $175,625 | 15.5% | | Net income attributable to A&F | $141,383 | 11.7% | $133,168 | 11.7% | | Diluted Net income per share attributable to A&F | $2.91 | | $2.50 | | [Condensed Consolidated Statements of Operations (YTD)](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations%20(YTD)) This section presents year-to-date fiscal 2025 condensed consolidated statements of operations, with $2.31 billion net sales and $4.47 diluted EPS YTD Fiscal 2025 Condensed Consolidated Statements of Operations (in thousands) | Item | August 2, 2025 | % of Net Sales | August 3, 2024 | % of Net Sales | | :------------------------------------------ | :------------- | :------------- | :------------- | :------------- | | Net sales | $2,305,871 | 100.0% | $2,154,704 | 100.0% | | Cost of sales, exclusive of D&A | $868,723 | 37.7% | $740,985 | 34.4% | | Operating income | $308,191 | 13.4% | $305,474 | 14.2% | | Net income attributable to A&F | $221,796 | 9.6% | $247,018 | 11.5% | | Diluted Net income per share attributable to A&F | $4.47 | | $4.64 | | [Condensed Consolidated Balance Sheets](index=12&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) This section presents the condensed consolidated balance sheets as of August 2, 2025, showing total assets of $3.30 billion and total equity of $1.31 billion Condensed Consolidated Balance Sheets (in thousands) | Item | August 2, 2025 | February 1, 2025 | August 3, 2024 | | :-------------------------------- | :------------- | :--------------- | :------------- | | Total current assets | $1,489,115 | $1,673,431 | $1,516,653 | | Total assets | $3,301,941 | $3,299,887 | $3,049,558 | | Total current liabilities | $1,038,041 | $1,126,944 | $1,051,656 | | Total long-term liabilities | $956,696 | $821,620 | $776,752 | | Total stockholders' equity | $1,307,204 | $1,351,323 | $1,221,150 | [Condensed Consolidated Statements of Cash Flows](index=13&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) This section presents year-to-date fiscal 2025 condensed consolidated statements of cash flows, with $112.9 million from operations Condensed Consolidated Statements of Cash Flows (in thousands) | Activity | Twenty-Six Weeks Ended August 2, 2025 | Twenty-Six Weeks Ended August 3, 2024 | | :-------------------------------- | :------------------------------------ | :------------------------------------ | | Net cash provided by operating activities | $112,893 | $260,119 | | Net cash used for investing activities | $(31,943) | $(96,649) | | Net cash used for financing activities | $(290,713) | $(326,961) | | Net decrease in cash and equivalents | $(200,063) | $(163,390) | | Cash and equivalents, end of period | $580,332 | $746,295 | [Company Information and Forward-Looking Statements](index=4&type=section&id=Company%20Information%20and%20Forward-Looking%20Statements) This section provides company background, a safe harbor statement regarding forward-looking information, and contact details [About Abercrombie & Fitch Co.](index=4&type=section&id=About%20Abercrombie%20%26%20Fitch%20Co.) Abercrombie & Fitch Co. is a global, digitally-led omnichannel retailer of apparel and accessories, operating Abercrombie and Hollister brands - Abercrombie & Fitch Co. is a global, digitally-led, omnichannel specialty retailer of apparel and accessories for kids through millennials[16](index=16&type=chunk) - Operates brands including Abercrombie and Hollister, with approximately **810 stores globally** and e-commerce sites[17](index=17&type=chunk) [Safe Harbor Statement](index=4&type=section&id=Safe%20Harbor%20Statement) This section contains forward-looking statements subject to inherent risks and uncertainties, including global trade, economic conditions, and competition - Contains forward-looking statements about future business and events, subject to risks and uncertainties[13](index=13&type=chunk) - Key risk factors include global trade policy (tariffs), economic and financial conditions (inflation, consumer spending), global operations, geopolitical conflicts, natural disasters, customer engagement, competition, and cybersecurity threats[13](index=13&type=chunk) [Contact Information](index=4&type=section&id=Contact%20Information) This section provides contact information for investor relations and media inquiries - Investor Contact: Mo Gupta, (614) 283-6751, Investor_Relations@anfcorp.com[18](index=18&type=chunk) - Media Contact: Kate Wagner, (614) 283-6192, Public_Relations@anfcorp.com[18](index=18&type=chunk)
Why Abercrombie & Fitch Stock Sank Today
The Motley Fool· 2025-08-27 21:54
Core Viewpoint - Concerns about tariffs overshadowed Abercrombie & Fitch's strong second-quarter performance, leading to a decline in stock price despite impressive earnings results [1] Group 1: Financial Performance - Abercrombie & Fitch achieved a record revenue of $1.19 billion for the quarter, representing a 7% year-over-year increase [2] - The non-GAAP adjusted net income was nearly $113 million, equating to $2.32 per share [2] - Both revenue and adjusted net income exceeded analyst expectations, which were $1.19 billion and $2.27 per share, respectively [4] Group 2: Sales Drivers - The increase in sales was attributed to strong demand for the Hollister brand, aimed at affluent young consumers [4] - Notable growth was observed in the Asia-Pacific region with a 12% increase in sales, and an 8% increase in the Americas, which offset a 1% decline in Europe, the Middle East, and Africa [4] Group 3: Future Guidance - Management raised its full-year 2025 guidance, now expecting annual net sales growth of 5% to 7%, up from a previous forecast of 3% to 6% [5] - The per-share net income estimate was also increased to a range of $10 to $10.50, compared to the prior estimate of $9.50 to $10.50 [5] Group 4: Tariff Impact - The company warned that increased tariffs on imports from countries like India, Vietnam, and Indonesia will raise costs by $90 million, significantly higher than the previously estimated $50 million [6]
Abercrombie Q2 Earnings Top Estimates, Hollister Brand Up 19%
ZACKS· 2025-08-27 18:16
Core Insights - Abercrombie & Fitch Co. (ANF) reported second-quarter fiscal 2025 results with both revenue and earnings exceeding Zacks Consensus Estimates, although year-over-year earnings per share (EPS) declined [1][9] - The company raised its full-year sales growth outlook to 5-7%, reflecting strong brand momentum and performance, particularly from the Hollister brand [3][15] Financial Performance - Abercrombie's EPS for the second quarter was $2.32, down 7.2% from $2.50 in the same quarter last year, but above the expected $2.27 [1][9] - Net sales reached $1.21 billion, a 7% increase year-over-year, surpassing the Zacks Consensus Estimate of $1.19 billion [2][9] - Comparable sales improved by 3%, driven by broad-based growth across regions and strong performance from Hollister, which saw a 19% increase in sales [2][8] Regional and Brand Performance - Sales in the Americas rose 8% to $974.2 million, while EMEA sales fell 1% to $197.2 million, and APAC sales increased 12% to $37.1 million [7] - The Abercrombie brand experienced a 5% decline in sales to $551.9 million, while Hollister's sales increased by 19% to $656.7 million [8] Profitability and Expenses - Abercrombie's gross margin contracted by 230 basis points year-over-year to 62.6%, while selling expenses decreased by 1.9% to $375.4 million [10] - Operating income increased by 17.7% to $206.7 million, with an operating margin of 17.1%, up 160 basis points from the previous year [11] Financial Health - The company ended the quarter with cash and cash equivalents of $572.7 million and no net long-term borrowings, indicating a stable financial position [12] - Abercrombie repurchased approximately 0.6 million shares for about $50 million in the second quarter, with a total of 3.2 million shares repurchased year-to-date for $250 million [13] Future Outlook - For the third quarter of fiscal 2025, Abercrombie projects net sales to rise 5-7% from the previous year's $1.21 billion, with an expected EPS range of $2.05-$2.25 [14] - The company anticipates a full-year operating margin of 13-13.5%, up from previous guidance, and plans to open 60 new stores while remodeling 40 and closing 20 [15][17]
Abercrombie says core shopper is being more discerning but still spending
CNBC Television· 2025-08-27 16:15
Financial Performance - Abbercrombie reports better than expected earnings and revenue [1] - Abbercrombie brand sales were down 5% with comps down 11% during the quarter [2] - Tariffs are expected to cost at least $90 million this year [6] Brand Performance & Strategy - Abbercrombie CEO reiterates that the Abbercrombie brand is strong [2] - Abbercrombie expects the brand to be back to growth by the end of the year [3] - Hollister sales were up 9% and was a big winner with back to school shopping [5] - Abbercrombie is expanding into the UK and has plans to move to Germany [4] - Abbercrombie Kids recently partnered with Macy's to drive sales [4] Market Trends & Partnerships - Abbercrombie's recent partnership with the NFL involves styling players this season, highlighting the role of fashion in sports [3][4] - Hollister recently launched a new Y2K assortment [5]
Options Traders Eye Abercrombie & Fitch Stock After Earnings
Schaeffers Investment Research· 2025-08-27 15:08
Core Insights - Abercrombie & Fitch Co reported strong second-quarter earnings of $2.32 per share on revenue of $1.21 billion, surpassing estimates of $2.30 per share and $1.20 billion in revenue, despite a decline in comparable sales by 11% [1] - The company raised its full-year outlook, indicating resilience against $90 million in tariff costs [1] Stock Performance - Abercrombie & Fitch stock increased by 1.6% to $98.20, recovering from earlier negative territory, supported by the 80-day moving average [2] - Year-to-date, the stock is down 34.3%, although it has been climbing since reaching a 52-week low of $65.40 on April 8 [2] Options Activity - In the options market, 14,000 calls and 15,000 puts have been traded today, which is 2.1 times the average daily options volume [3] - The most popular options contracts include the weekly 8/29 82-strike put and the September 95 call, with new positions opening in both [3] Short Interest - Abercrombie & Fitch has significant short squeeze potential, with short interest accounting for 14.6% of the available float [4] - It would take nearly three days for short positions to be fully covered at the average trading pace [4]
PVH Might Create Massive Shareholder Value (Playing The Abercrombie & Fitch Handbook?)
Seeking Alpha· 2025-08-27 14:54
Core Insights - Abercrombie & Fitch's stock experienced a remarkable increase of 1790% from 2020 to mid-2024, indicating a significant deep value re-rating opportunity in the market [1] Investment Opportunity - An investment of $2,000 in Abercrombie & Fitch could have resulted in a profit of $39,000, showcasing the potential returns available in this stock [1]
A&F(ANF) - 2026 Q2 - Earnings Call Transcript
2025-08-27 13:32
Financial Data and Key Metrics Changes - The company reported record net sales of $1,210,000,000 for Q2, a 7% increase compared to the previous year, exceeding expectations [7][20] - Operating margin was 13.9%, above the outlook range provided in May, with adjusted net income per diluted share at $2.32, slightly above last year's $2.50 [8][24] - The company repurchased $50,000,000 worth of shares in the quarter, totaling $250,000,000 in repurchases for the year [8][25] Business Line Data and Key Metrics Changes - Hollister brands achieved a 19% increase in net sales for Q2, with comparable sales also up 19%, driven by strong cross-channel traffic [10][21] - Abercrombie brands saw a 5% decline in net sales, with comparable sales down 11%, primarily due to lower average unit retail (AUR) as inventory was cleared [12][21] Market Data and Key Metrics Changes - The Americas region reported an 8% increase in net sales, marking its twelfth consecutive quarter of growth, while EMEA experienced a 1% decline [9][20] - APAC region continued to perform well with a 12% growth in net sales [9][20] Company Strategy and Development Direction - The company is focused on leveraging its strong brand positioning and clean inventory to drive sales growth and profitability in the second half of the year [16][28] - The company plans to open 60 new stores and remodel 40 existing locations, expecting to be net store openers [29][98] - A partnership with the NFL was announced, aiming to enhance brand visibility and engagement [14][78] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in returning to growth for Abercrombie by the end of the year, citing strong traffic and successful product launches [37][106] - The company is navigating a challenging tariff environment with a focus on mitigating costs through various strategies [18][120] Other Important Information - The company anticipates a tax rate around 30% and expects capital expenditures of approximately $225,000,000 for the year [29][30] - Marketing investments are expected to increase by over 100 basis points year-over-year to support key partnerships and campaigns [30][86] Q&A Session Summary Question: What markers give confidence for Abercrombie's acceleration? - Management highlighted strong traffic, new partnerships, and successful store openings as key indicators of confidence for growth [35][36] Question: Clarification on credit card settlement inclusion/exclusion? - The $39,000,000 net benefit from the credit card settlement was included in the operating margin guidance, offset by increased tariffs [38][39] Question: Update on Abercrombie Kids' entry into department stores? - The launch has been positive, with good feedback from partners and customers, indicating a successful diversification of the operating model [41][42] Question: Insights on Hollister's momentum and developments? - Hollister's performance is strong across categories, with successful product launches and a focus on customer engagement driving growth [50][51] Question: Traffic cadence during Q2 and expectations for Q3? - Traffic has been consistently strong across brands and channels, with positive momentum heading into the back-to-school season [60][61] Question: Details on tariff impact and mitigation efforts? - The company is facing a $90,000,000 tariff impact for the year, with ongoing efforts to optimize sourcing and manage costs [27][76] Question: Update on the denim category and pricing strategy? - The denim business is performing well with a variety of price points, reflecting strong customer demand and engagement [122][124]
A&F(ANF) - 2026 Q2 - Earnings Call Transcript
2025-08-27 13:30
Financial Data and Key Metrics Changes - The company reported record net sales of $1,210,000,000 for Q2 2025, representing a 7% increase compared to the previous year, exceeding expectations [7][19] - Operating margin was 13.9% of sales, above the outlook range provided in May, with operating income of $168,000,000 compared to $176,000,000 last year [22][23] - Adjusted net income per diluted share was $2.32, above the outlook, compared to $2.50 last year [24] Business Line Data and Key Metrics Changes - Hollister brands achieved a 19% increase in net sales for Q2, with comparable sales also up 19%, driven by strong cross-channel traffic [9][21] - Abercrombie brands saw a 5% decline in net sales, with comparable sales down 11%, primarily due to lower average unit retail (AUR) as inventory was cleared [11][21] Market Data and Key Metrics Changes - The Americas region reported an 8% increase in net sales, marking its twelfth consecutive quarter of growth [8][20] - APAC region grew by 12%, while EMEA experienced a 1% decline in net sales, impacted by softness in Germany and other European markets [8][20] Company Strategy and Development Direction - The company plans to increase full-year net sales growth expectations based on strong year-to-date results and brand positioning [16][27] - The company is focusing on maintaining strong brand health and engaging customers through partnerships, such as the collaboration with the NFL [14][17] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in returning to growth by the end of the year, citing strong traffic and successful product launches [36][100] - The company is navigating a new tariff landscape from a position of strength, with plans to mitigate costs through various strategies [17][72] Other Important Information - The company repurchased $50,000,000 worth of shares in Q2, totaling $250,000,000 in repurchases for the year [7][25] - Inventory levels were reported to be in a clean position, with inventory at cost up 10% and units up 7% [23][51] Q&A Session Summary Question: What are the markers for acceleration for the Abercrombie brand? - Management highlighted strong traffic, exciting partnerships, and successful store openings as key indicators of future growth [34][36] Question: Can you clarify the credit card settlement inclusion/exclusion? - The $39,000,000 net benefit from the credit card settlement was included in the operating margin guidance, offset by increased tariffs [37][38] Question: How is the Abercrombie Kids launch going? - The launch has received positive feedback, and the company is excited about expanding its operating model [40][42] Question: What is driving the momentum in Hollister? - Management noted that everything is working well for Hollister, with strong consumer engagement and successful product launches [47][49] Question: What is the state of carryover inventory? - The company reported significant progress in managing carryover inventory, with a clean and current position heading into the back half of the year [50][51] Question: What gives confidence for Abercrombie's future performance? - Management cited strong traffic, successful campaigns, and a solid start to Q3 as reasons for confidence in returning to growth [100][102] Question: Can you elaborate on the tariff impact? - The company is facing a $90,000,000 cost impact from tariffs, with ongoing efforts to mitigate these costs through various strategies [26][72] Question: How is the EMEA business performing? - The UK market is performing well, while Germany has faced challenges; however, management remains optimistic about future growth in the region [75][76]
A&F(ANF) - 2026 Q2 - Earnings Call Transcript
2025-08-27 13:30
Financial Data and Key Metrics Changes - The company reported record net sales of $1,210,000,000 for Q2 2025, representing a 7% increase compared to the previous year, exceeding expectations [7][19] - Operating margin was 13.9% of sales, above the outlook range provided in May, with operating income of $168,000,000 compared to $176,000,000 last year [22][23] - Adjusted net income per diluted share was $2.32, above the outlook, compared to $2.50 last year [24] Business Line Data and Key Metrics Changes - Hollister brands achieved a 19% increase in net sales for Q2, with comparable sales also up 19%, driven by strong cross-channel traffic [9][21] - Abercrombie brands saw a 5% decline in net sales, with comparable sales down 11%, primarily due to lower average unit retail (AUR) as inventory was cleared [11][21] Market Data and Key Metrics Changes - The Americas region reported an 8% increase in net sales, marking its twelfth consecutive quarter of growth [8][20] - APAC region grew by 12%, while EMEA experienced a 1% decline in net sales, impacted by softness in Germany and other European markets [8][20] Company Strategy and Development Direction - The company is focused on leveraging its strong foundation to balance current market conditions while investing for long-term global potential [6] - Plans include opening 60 new stores and remodeling 40 existing locations, with a net increase of around 40 stores expected by year-end [29][92] - The company aims to enhance brand positioning through partnerships, such as the recent collaboration with the NFL [14][17] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in returning to net sales growth by the end of the year, supported by strong brand health and clean inventory [16][36] - The company anticipates a $90,000,000 impact from tariffs for 2025, with strategies in place to mitigate costs through various operational adjustments [26][112] - Management highlighted the importance of maintaining customer value without broad-based price increases, focusing on brand experience [70][112] Other Important Information - The company repurchased $50,000,000 worth of shares in Q2, totaling $250,000,000 in repurchases for the year [7][25] - Inventory levels were reported as clean, with inventory at cost up 10% and units up 7% [23][50] Q&A Session Summary Question: What markers give confidence for Abercrombie's acceleration? - Management highlighted strong traffic, new partnerships, and successful store openings as key indicators of confidence for future growth [34][36] Question: How is the Abercrombie Kids launch going? - The launch has received positive feedback, and management is excited about expanding the operating model [40][42] Question: What contributed to Hollister's 19% growth? - Management noted that strong consumer engagement and successful product launches contributed to Hollister's performance [47][49] Question: What is the state of carryover inventory? - Management reported significant progress in managing carryover inventory, with a clean position heading into the back half of the year [50][51] Question: What is the outlook for gross margin in Q3? - Management expects some margin pressure due to tariffs and marketing investments, but remains focused on maintaining AUR [59][61] Question: How is the company addressing tariff impacts? - The company is employing a strategic approach to mitigate tariff impacts, including vendor negotiations and operational efficiencies [70][112] Question: What is the outlook for the EMEA region? - Management remains optimistic about the UK market while acknowledging challenges in Germany, with plans to replicate successful strategies [72][73]