Abercrombie & Fitch Co. - Class A
Q3 2024 Earnings
Market Reaction
S&P 500 over the same 30 days: −2.13%.
Did ANF Beat Earnings? Q3 2024 Results
Abercrombie & Fitch kept its momentum intact in the third quarter of fiscal 2024, posting results that beat Wall Street expectations on both the top and bottom lines and marking its sixth consecutive quarter of double-digit net sales growth. The retailer reported GAAP diluted EPS of $2.50, ahead of the $2.22 consensus estimate by roughly 12.46%, while revenue of $1.21 billion grew 14.4% year over year and came in 2.73% above what analysts had projected. The quarter's outperformance was broadly driven by comparable sales growth of 16%, fueled by reduced promotional activity that helped lift the gross profit rate 20 basis points to 65.1% and expand operating margin 170 basis points to 14.8%. Both the Abercrombie and Hollister brand families contributed, with strength spanning all geographic regions. Encouraged by the results, management raised its full-year fiscal 2024 net sales growth outlook to 14% to 15%, from a prior range of 12% to 13%, and reaffirmed an operating margin target of around 15%, while guiding Q4 net sales growth of 5% to 7%.
- Sixth consecutive quarter of double-digit net sales growth
- Broad-based growth across all regions and both brand families
- Comparable sales growth of 16% driven by strong customer response to product and marketing
- Higher average unit retail on reduced promotions driving gross profit rate expansion
- Operating expense leverage with stores and distribution expense declining to 34.7% of net sales from 36.3%
- Interest income of $9.3 million versus interest expense of $0.7 million a year ago following debt elimination
“For the sixth consecutive quarter, our global team delivered double-digit net sales growth. This great sales performance led to better-than-expected results on both the top and bottom lines. With broad-based growth across regions and brands, we continue to execute at a high level, leveraging our regional playbooks and operating model. Each of our regions grew double-digits in the quarter, with the Americas growing 14%, EMEA growing 15% and APAC growing 32%.”
Abercrombie & Fitch CEO, on the earnings call
Forward Guidance & Outlook
For full year fiscal 2024, the company raised its outlook to net sales growth of 14% to 15% (from 12% to 13%) and operating margin around 15% (from 14% to 15%), with effective tax rate in the mid-20s and capital expenditures of approximately $170 million. Real estate activity includes approximately 20 net store openings (60 openings, 40 closures) and 60 remodels and right-sizes. For Q4 2024, the company expects net sales growth in the range of 5% to 7% (includes a 550 basis point adverse impact from the loss of the extra week in fiscal 2023 and an estimated 100 basis point adverse impact from foreign currency), operating margin around 16%, and effective tax rate in the high-20s. The company expects Americas to continue leading regional performance and Abercrombie brands to continue outperforming Hollister brands.
ANF YoY Financials
ANF Revenue by Segment
ANF Revenue by Geography
Figures from SEC filings and company reports. Not investment advice.