American Eagle says consumer is slowing down, issues weak guidance

Core Viewpoint - American Eagle has warned investors of a slower start to 2025, indicating a pullback in consumer spending and a challenging operating environment [1][2][3] Company Performance - The company reported a net income of $104 million, or 54 cents per share, for the fiscal fourth quarter, compared to$6.31 million, or 3 cents per share, a year earlier [5] - Sales for the quarter were $1.60 billion, slightly down from$1.68 billion a year prior, impacted by an extra week in the previous year [6][7] - Earnings per share exceeded expectations at 54 cents, while revenue met expectations at $1.60 billion [7] Future Outlook - For the current quarter, American Eagle anticipates a mid-single-digit decline in sales, contrasting with analyst expectations of a 1.3% revenue increase [6] - The company expects a low single-digit decline in sales for the full year, while analysts had projected a 3% growth [6] - CEO Jay Schottenstein mentioned proactive steps to strengthen the top-line, manage inventory, and reduce expenses amid uncertain consumer conditions [2][3] Industry Context - Other retailers have also issued weak guidance and cautious commentary, suggesting a broader trend of slowing consumer demand due to persistent inflation and tariff concerns [3][4]