Abercrombie & Fitch’s shares are up 37%, thanks to Hollister’s success

Core Insights - Abercrombie & Fitch Co. has transformed from a struggling brand to a popular choice among millennials and older Gen Zs since 2019 [1] - The company reported $1.29 billion in revenue for Q3, marking a 7% year-over-year increase and achieving its twelfth consecutive quarter of growth [1][2] - Abercrombie's earnings per share reached $2.36, surpassing Wall Street's estimate of $2.16 [2] Revenue and Sales Performance - Abercrombie's retail store net sales declined by 2% year-over-year to $617.35 million, with a 7% decrease in comparable sales [3] - In contrast, Hollister, another brand under Abercrombie, reported net sales of $673.27 million, reflecting a 16% year-over-year increase and a 15% rise in comparable sales [4] - Hollister has shown consistent growth, with net sales increasing by 19% and 22% in the first and second quarters, respectively [5] Management and Future Outlook - CEO Fran Horowitz noted that the decline in Abercrombie's brand sales was due to inventory markdowns, but expressed optimism about progress in managing inventory [6] - The company anticipates flat net sales for Abercrombie in Q4 compared to last year's record and expects overall net sales growth of 6% to 7% for fiscal 2025 [6]