Abercrombie & Fitch Co. - Class A
Q1 2025 Earnings
Market Reaction
S&P 500 over the same 30 days: +4.68%.
Did ANF Beat Earnings? Q1 2025 Results
Abercrombie & Fitch kicked off fiscal 2025 with a decisive beat on both top and bottom lines, as a remarkable turnaround at Hollister helped the retailer post first-quarter results well ahead of Wall Street's expectations. Revenue rose 7.5% year-over-year to $1.10 billion, clearing the $1.06 billion consensus by 3.55%, while GAAP diluted EPS of $1.59 topped the $1.33 estimate by nearly 19.67%, even as that figure declined from $2.14 a year ago amid sharp margin pressure. The standout driver was Hollister, which surged 22% to $549.36 million on 23% comparable sales growth, offsetting a 4% decline in the Abercrombie brands as those labels lapped 31% growth in the prior-year period. Operating margin contracted 340 basis points to 9.3%, weighed down by a 440 basis point increase in cost of sales as a percentage of net sales. Looking ahead, management raised its full-year revenue growth outlook to 3%-6% but cut operating margin guidance to 12.5%-13.5% and lowered EPS guidance to $9.50-$10.50, absorbing roughly $50 million in tariff headwinds tied to current U.S. trade policy.
- Hollister brands growth of 22% with best-ever first quarter net sales
- Broad-based growth across all three geographic regions
- Comparable sales of 4% on a constant currency basis
- Operating expense leverage with G&A declining to 15.9% from 18.6% of net sales
- Share repurchases reducing diluted weighted average shares from 53,276 to 50,634
“We delivered record first quarter net sales with 8% growth to last year. This was above our expectations and was supported by broad-based growth across our three regions. Hollister brands led the performance with growth of 22%, achieving its best ever first quarter net sales, while Abercrombie brands net sales were down 4% against 31% sales growth in 2024. We exceeded our expectations on the bottom line as well, with operating margin of 9.3% and earnings per share of $1.59. We also returned excess cash to shareholders through share repurchases totaling $200 million in the quarter, marking our fifth consecutive quarter of share repurchases.”
Abercrombie & Fitch CEO, on the earnings call
Forward Guidance & Outlook
For fiscal 2025, the company now expects net sales growth of 3% to 6% (raised from 3%-5%), operating margin of 12.5% to 13.5% (lowered from 14%-15%), effective tax rate around 27%, net income per diluted share of $9.50 to $10.50 (lowered from $10.40-$11.40), share repurchases of $400 million, diluted weighted average shares around 49 million, capital expenditures of ~$200 million, and ~40 net store openings (60 openings, 20 closures) with 40 remodels and right-sizes. The full year outlook includes approximately $50 million of tariff expense (100 bps of net sales) based on currently effective trade policies (30% tariff on Chinese imports, 10% on all other global imports), net of planned mitigation, but excludes currently-paused tariffs and potential future trade policy changes. For Q2 2025, the company expects net sales growth of 3% to 5%, operating margin of 12% to 13%, effective tax rate around 28%, EPS of $2.10 to $2.30, and share repurchases of $50 million.
ANF YoY Financials
ANF Revenue by Segment
ANF Revenue by Geography
Figures from SEC filings and company reports. Not investment advice.