Abercrombie & Fitch (NYSE:ANF) shares rose about 12% after the corporate reported first-quarter outcomes that beat revenue expectations, whereas income barely missed and comparable gross sales declined.
For the quarter ended Might 2, the corporate posted adjusted earnings of $1.47 per share, above analyst expectations of $1.28.
Web gross sales rose 2% yr over yr to $1.11 billion, narrowly lacking consensus estimates of $1.12 billion.
Comparable gross sales fell 1%, in contrast with expectations for flat efficiency.
The corporate’s 14th consecutive quarter of income progress was pushed by a 3% improve within the Americas and a 24% bounce in APAC, whereas EMEA declined 10%.
Abercrombie model gross sales rose 3%, whereas Hollister was flat.
Trying forward, the corporate maintained its full-year outlook, anticipating web gross sales progress of three% to five% and web earnings per diluted share of $10.20 to $11. It additionally reiterated plans for roughly $450 million in share repurchases for the yr.
For the second quarter, Abercrombie & Fitch forecast web gross sales progress of two% to 4% and earnings per share of $1.80 to $2, alongside a minimum of $150 million in buybacks.
“With our buyer on the middle of all the things we do and a powerful basis in place, we stay on offense throughout product and advertising and marketing and are assured in our path to ship full-year web gross sales progress throughout manufacturers, double-digit working margins, robust money stream and earnings per share progress to create long-term worth for shareholders,” Abercrombie CEO Fran Horowitz stated in a press release.
Jefferies analysts wrote that the entire firm outcomes got here in higher than feared, with comparable gross sales efficiency barely forward of expectations and Abercrombie-branded comps notably extra resilient than anticipated, coming in flat versus expectations for a decline. The agency believes that this means underlying model power is holding up higher than the Avenue had modeled, at the same time as general comps remained unfavorable.
On regional efficiency, Jefferies highlighted continued power within the Americas and APAC offset by a sharper downturn in EMEA, which it attributed to a more durable geopolitical and demand backdrop. It flagged EMEA as a key ongoing strain level for the expansion combine.
On margins, Jefferies famous that each working margin and EPS exceeded the corporate’s prior outlook, regardless of softer income and considerations round promotions.
The agency stated the outcome factors to continued self-discipline on prices and a positive model combine impact supporting profitability.
