Urban Outfitters(US:URBN) ZACKS·2026-02-26 17:21Core Insights - Urban Outfitters, Inc. (URBN) reported strong fourth-quarter fiscal 2026 results, with both earnings and sales exceeding expectations and showing year-over-year improvement [1][4]. Financial Performance - Earnings per share reached $1.43, surpassing the Zacks Consensus Estimate of $1.24, marking a 37.5% increase from the previous year [4][9]. - Total net sales rose 10.1% year over year to $1,801.8 million, exceeding the consensus estimate of $1,787 million [4][9]. Segment Performance - Retail segment sales increased by 7.7% year over year, with comparable sales up 5.5%, driven by growth in both digital and physical store channels [5]. - The Wholesale segment saw a 9.1% increase in net sales, primarily due to a 10.2% rise in Free People Wholesale revenues [6]. - Nuuly, the women's apparel subscription service, experienced a significant 42.6% increase in net sales, reflecting a 40.3% rise in average active subscribers [6]. Margin and Cost Insights - Gross profit increased by 13.6% year over year to $599.2 million, with gross margin expanding 101 basis points to 33.3% [7][8]. - Selling, general and administrative (SG&A) expenses rose 9.5% year over year to $440.5 million, driven by higher marketing investments and increased store payroll expenses [10][11]. Operational Updates - URBN opened 42 retail locations in the fourth quarter, including new stores for Urban Outfitters, Anthropologie, and Free People, while closing a few locations [12][14]. - As of January 31, 2026, URBN operated a total of 253 Urban Outfitters stores, 254 Anthropologie stores, and 268 Free People stores across various regions [13]. Future Outlook - For fiscal 2027, the company anticipates high-single-digit total sales growth, supported by mid-single-digit comparable sales growth in the Retail segment [20][24]. - The gross margin is expected to expand by 25 basis points, with SG&A expenses projected to grow faster than sales due to strategic investments [25][26].