Abercrombie & Fitch Company (NYSE:ANF) shares were trading lower in the premarket on Wednesday.
The company reported second-quarter adjusted earnings per share of $2.32, beating the analyst consensus estimate of $2.30.
Quarterly sales of $1.209 billion (+7% year over year) outpaced the Street view of $1.195 billion.
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The company stated that Hollister brands delivered their “best ever” second-quarter net sales, posting growth of 19%. In contrast, Abercrombie brands reported a 5% decline.
Abercrombie & Fitch’s net sales growth was driven by an 8% increase in the Americas and a 12% increase in APAC, partially offset by a 1% decline in EMEA.
The company reported an operating margin of 17.1% as a percentage of sales on a reported basis and 13.9% on an adjusted basis, compared to 15.5% in the prior year.
“While we made progress on key inventory initiatives by leveraging promotions and testing new product concepts, Abercrombie brands net sales were down 5%, lapping 26% growth in the prior year,” said CEO Fran Horowitz. “On the bottom line, we exceeded our second quarter profitability expectations, while also returning $50 million to shareholders through our sixth consecutive quarter of share repurchases.”
The company exited the quarter with cash and equivalents worth $573 million.
Inventories stood at $593 million compared to $575 million as of February 1, 2025. They were $540 million as of August 3, 2024.
Outlook
“We entered the second half of 2025 on offense,” Horowitz said.
The company raised its fiscal year 2025 GAAP earnings per share guidance from a prior range of $9.50 to $10.50 to a new range of $10.00 to $10.50, compared to the previous estimate of $10.28. It also lifted its fiscal year 2025 sales guidance from a range of $5.100 billion to $5.250 billion to a new range of $5.200 billion to $5.290 billion, versus the $5.205 billion estimate.
“Our team remains focused on delivering for our customers while investing to capitalize on the significant, long-term opportunities for our global brands,” Horowitz added.
Abercrombie & Fitch said it expects third-quarter 2025 GAAP earnings per share to be in the range of $2.05 to $2.25, below the $2.55 estimate.
The company forecasted sales of $1.270 billion to $1.290 billion, compared to the previously estimated $1.261 billion.
Price Action: ANF shares are trading up 1.30% at $98.00 as of the last check on Wednesday.
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