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Investing.com -- Abercrombie & Fitch Co. reported better-than-expected second-quarter results on Tuesday, with revenue reaching a record $1.2 billion, prompting the retailer to raise its full-year sales outlook despite tariff headwinds.
The apparel retailer posted adjusted earnings of $2.32 per share, exceeding analyst expectations of $2.27. Revenue grew 7% YoY to $1.2 billion, surpassing the consensus estimate of $1.19 billion. Following the announcement, shares jumped 4.7% as investors cheered the company’s eleventh consecutive quarter of growth.
Hollister brands delivered its strongest second quarter ever with 19% sales growth, though Abercrombie brands declined 5% against tough comparisons from last year when the segment grew 26%. Geographically, sales in the Americas rose 8% and Asia-Pacific increased 12%, while Europe, Middle East and Africa saw a slight 1% decline.
"We delivered record second quarter net sales, exceeding our expectations, with 7% growth to last year," said CEO Fran Horowitz. "We continued to drive meaningful engagement with our teen customer in Hollister brands, growing 19% on strong summer and back-to-school demand."
The company raised its full-year sales growth forecast to 5-7%, up from its previous outlook of 3-6%. For the third quarter, Abercrombie expects earnings between $2.05 and $2.25 per share, below the analyst consensus of $2.57, as the company factors in approximately $90 million in tariff costs for the full year.
Operating margin for the second quarter was 13.9% on an adjusted basis, compared to 15.5% in the same period last year. The company also continued its share repurchase program, buying back 0.6 million shares for approximately $50 million during the quarter.
Abercrombie maintained its full-year earnings guidance of $10.00 to $10.50 per share, in line with analyst expectations of $10.30.