Key things
- Shares of Abercrombie & Fitch jumped 31% on Wednesday after reporting a surprise first-quarter profit.
- The results were supported by lower shipping costs and higher prices.
- The retailer raised its outlook for full-year net sales and operating margin.
Shares of Abercrombie & Fitch (ANF) soared 31% on Wednesday after the retailer reported a surprise profit and raised its full-year outlook.
Abercrombie reported first quarter earnings per share (EPS) of $0.39. Analysts had expected a loss of $0.05. Revenue rose 2.9% to $836 million, also ahead of forecasts. Comparable store sales rose by 3%, while estimates called for a decline of 1%.
The retailer pointed to a significant drop in shipping costs and an increase in pricing, or average retail sales (AUR), for the good results.
CEO Fran Horowitz noted that AUR has jumped by double-digit percentages since the COVID-19 pandemic, calling it a “big win for us.”
She added that Abercrombie’s products “resonate meaningfully with our target customer” and set multiple sales records across genders, categories and geographies.
The company is now counting on 2023 Net sales growth in the range of 2% to 4%, an increase from the previous outlook of 1% to 3% higher. He sees that operating margin 5% to 6% compared to the earlier range of 4% to 5%.
YCharts
