American Eagle, Abercrombie beat revenue estimates on strong in-store sales

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  • Apparel chains American Eagle Outfitters and Abercrombie & Fitch beat quarterly revenue estimates on Tuesday, as customers returning to schools and offices made more purchases at physical stores following the easing of COVID-19 restrictions.
  • The American Eagle label’s revenue rose 21% to $941 million, while revenue for the Aerie brand, which sells leggings and bras, grew 28% to $315 million.
  • Abercrombie & Fitch’s net sales rose 10% to $905.2 million, beating estimates of $896.9 million. It also announced a new $500 million share buyback plan.

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Apparel chains American Eagle Outfitters and Abercrombie & Fitch beat quarterly revenue estimates on Tuesday, as customers returning to schools and offices made more purchases at physical stores following the easing of COVID-19 restrictions.

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Those stuck at home during the lockdown turned to comfortable joggers and sweatshirts, but the re-opening of schools, workplaces and public places after vaccination has given them a respite on streetwear, including jeans and shirts.

“The start of the holiday season has been promising. Customers are quick to shop and are responding well to the assortment,” Abercrombie & Fitch CEO Fran Horowitz said in a statement.

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Most American apparel vendors, including TJ Maxx-parent TJX and Macy’s, have brushed off concerns about the holiday listing, saying they have enough inventory despite port congestion and some factory closures.

American Eagle Outfitters said inventory at cost rose 32% to $740 million at the end of the third quarter, as it deployed pricier air freight to navigate global supply chain issues.

The apparel chain is upping its logistics game, after agreeing to buy Quiet Logistics this month for $350 million, following its acquisition of Airtera earlier this year.

Total net revenue rose 24% to $1.27 billion for the third quarter ended October 30, according to Refinitiv IBES, which exceeded analysts’ average estimate of $1.23 billion.

The American Eagle label’s revenue rose 21% to $941 million, while revenue for the Aerie brand, which sells leggings and bras, grew 28% to $315 million.

Shares of American Eagle Outfitters rose 4% as total net income rose 162% to $152.2 million. Adjusted profit was 76 cents per share.

Abercrombie & Fitch’s net sales rose 10% to $905.2 million, beating estimates of $896.9 million. It also announced a new $500 million share buyback plan.

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