Urban Outfitters-URBN Reports Record Q4 Sales and FY'25 Profits

Core Insights - Urban Outfitters, Inc. reported record net income of $402.5 million and earnings per diluted share of$ 4.26 for the year ended January 31, 2025, reflecting strong performance across all segments [1][14] - The company achieved total net sales of $5.55 billion for the year, a 7.7% increase compared to the previous year, driven by growth in retail, subscription, and wholesale segments [4][5] Financial Performance - For the three months ended January 31, 2025, net income was$ 120.3 million, with earnings per diluted share of $1.28, compared to$ 47.8 million and $0.50 in the same period last year [1][14] - Adjusted net income for the same quarter was$ 98.1 million, up from $65.8 million year-over-year, with adjusted earnings per diluted share increasing to$ 1.04 from $0.69 [2][14] - Gross profit for the three months ended January 31, 2025, increased by 21.5% to$ 527.7 million, with a gross profit rate of 32.3%, up from 29.2% in the prior year [8][9] Sales Breakdown - Total company net sales for the three months ended January 31, 2025, reached $1.64 billion, a 10.1% increase from the previous year [3][4] - Retail segment net sales increased by 6.3%, with comparable retail segment net sales rising by 5.1%, driven by digital channel sales growth [3][4] - Subscription segment net sales surged by 78.4%, primarily due to a 53.5% increase in average active subscribers [3][4] Segment Performance - For the year ended January 31, 2025, retail segment net sales increased by 4.7%, with comparable sales up 3.4% [4][5] - Wholesale segment net sales grew by 15.5%, driven by a 17.9% increase in Free People wholesale sales [4][5] - The company opened 57 new retail locations and closed 30 during the year, indicating a strategic expansion despite some closures [16] Inventory and Expenses - Total inventory as of January 31, 2025, increased by$ 70.9 million, or 12.9%, compared to the previous year, with retail segment inventory up 10.1% [10] - Selling, general and administrative expenses for the year increased by $113.7 million, or 8.5%, reflecting higher marketing and payroll expenses [12][11] Tax and Share Repurchase - The effective tax rate for the year ended January 31, 2025, was 19.5%, down from 24.6% the previous year, primarily due to a tax benefit from the release of income tax reserves [13] - The company repurchased 1.2 million shares for approximately$ 52 million during the year, with 18 million shares remaining under the repurchase program [15]