Abercrombie & Fitch store stands at Midtown Manhattan, New York on October 24, 2024.
Spencer Platt | Getty Images
Abercrombie & FitchThe story of growth begins to slow down.
The clothing seller issued weaker guidelines than expected for his current quarter and a fiscal 2025 and said he expects his sale to grow more slowly than Wall Street predicted.
Abercrombie expects sales to increase between 3% and 5% in the fiscal 2025, which is significantly below the growth estimate of 6.8%, LSEG states. During its current quarter, the company predicts that earnings per share will be between $ 1.25 and $ 1,45, which is less than an expectation of $ 1.97.
The shares have fallen almost 5% in the Prevari store.
In addition to its leadership, Abercrombie closely defeated Wall Street expectations in its fiscal fourth quarter. Here’s how the merchant performed compared to what Wall Street predicted, based on research by LSEG analysts:
- Earnings per share: $ 3,57 Compared to the expected $ 3.54
- Income: $ 1.58 billion Compared to the expected $ 1.57 billion
The company reported a net revenue for a quarterly period that ended on February 1. It was $ 187 million, or $ 3.57 per share, compared to $ 158 million, or $ 2,97 per share, a year earlier.
The sale increased to $ 1.58 billion, which is 9% more than $ 1.45 billion a year earlier.
In January, Abercrombie offered Investors in the view To his holiday effect when he published an early set of results and raised his chances of the fourth quarter. Still, the stock fell that day because the forecast showed that Abercrombie expects his growth moderate, and he did not anticipate that his operational margin would improve beyond the previous forecast.
After approximately two years of explosive supplies and sales growth, Abercrombie’s business seems to be leveled, and the markets may be turning from the largest retail star in favor of a name with more immediate progress.
The company is still growing and working on the construction of its international market, but it is unclear whether it will still see the blockbuster numbers that it has dropped after implementing a turnaround under French Horowitz CEO. It faces severe comparisons from the previous year, and some of the buzz from a turnaround may start to fade.
In addition, consumers have been cautious from the beginning of the year, which will always pressure special traders who sell discretioned goods like clothing. Geopolitics, unusually cold weather and mass tragedies like wild fires in Los Angeles have muffled consumer demand, but customers are also worried about things such as a tariff price increase. In February, consumer confidence slipped to the lowest levels of 2021.
In addition, Abercrombie could see the influence of the proposed prohibition of a tictoka, which has withdrawn Elf beautyAppearance at the beginning of the year. Both companies largely rely on marketing ticters. In February, Elf’s Executive Director Tarang Amin told CNBC to suspect the proposed prohibition Cosmetics sales affected cosmetics Because people did not post things like the video “Get ready with me” or draw clothes, which can stimulate sales.
In a statement in January, Horowitz hinted that Abercrombie would be more focused on gain increase than for sale, because it seems that it “fosters a long -term value of the shareholder”.
“After the expected two years of double -digit upper and lower growth, I am only convinced as always in the power of our brands and the operating model as we move forward, supported by the extraordinary options we have built,” Horowitz said. “In 2025. We will look to continue sustainable, profitable growth by performing our books to win and keep customers around the world. Our goal is to use our healthy margin structure and balance sheets to increase dollars and earnings per share at a price faster than sales.”
