Abercrombie & Fitch Co. - Class A
Q2 2025 Earnings
Excludes a $38.574 million pre-tax favorable settlement, net of legal fees, of payment card interchange fee litigation ($0.59 per share benefit on tax-adjusted basis)
Market Reaction
S&P 500 over the same 30 days: +2.66%.
Did ANF Beat Earnings? Q2 2025 Results
Abercrombie & Fitch navigated a quarter of sharp contrasts to post better-than-expected results, with adjusted EPS of $2.32 edging past the $2.30 consensus estimate and net sales of $1.21 billion topping expectations on 6.6% year-over-year growth. The headline story was a tale of two brands: Hollister surged 19% to $656.69 million, posting its best-ever Q2 performance, while Abercrombie brands slipped 5% to $551.87 million as they lapped an exceptionally strong prior-year comparison of 26% growth. Cost pressures were a real counterweight, with cost of sales rising to 37.4% of net sales from 35.1% a year ago as early tariff impacts on sourcing began flowing through, though the company managed to offset some of that pressure through improved operating expense leverage. Management responded to the results by raising full-year net sales growth guidance to 5% to 7% and lifting the EPS range to $10.00 to $10.50, even as it absorbs an estimated $90 million in net tariff costs for the year, a recognition that strategic agility, which has drawn broader industry attention, remains central to its playbook.
- Hollister brands delivered 19% net sales growth on strong summer and back-to-school demand
- Americas segment grew 8% year-over-year
- APAC segment grew 12% year-over-year
- Comparable sales grew 3% on constant currency basis
- $38.6 million favorable litigation settlement boosted operating income
- Selling expense leverage improved to 31.1% from 33.7% of net sales
- G&A expense leveraged to 14.5% from 15.7% of net sales
“We delivered record second quarter net sales, exceeding our expectations, with 7% growth to last year. We continued to drive meaningful engagement with our teen customer in Hollister brands, growing 19% on strong summer and back-to-school demand. While we made progress on key inventory initiatives by leveraging promotions and testing new product concepts, Abercrombie brands net sales were down 5%, lapping 26% growth in the prior year. On the bottom line, we exceeded our second quarter profitability expectations, while also returning $50 million to shareholders through our sixth consecutive quarter of share repurchases.”
Abercrombie & Fitch CEO, on the earnings call
Forward Guidance & Outlook
For fiscal 2025, the company raised its full-year net sales outlook to growth of 5% to 7% (from 3% to 6%), narrowed operating margin guidance to 13.0% to 13.5% (from 12.5% to 13.5%), and raised the full-year EPS range to $10.00–$10.50 (from $9.50–$10.50). The outlook incorporates approximately $90 million of net tariff cost impact (170 basis points of net sales) based on trade policies as of August 25, 2025. The effective tax rate is now expected around 30% (up from 27%). Share repurchases are expected around $400 million and capital expenditures approximately $225 million (up from ~$200 million). Real estate activity calls for approximately 40 net store openings. For Q3, the company expects net sales growth of 5% to 7%, operating margin of 11% to 12%, and EPS of $2.05 to $2.25, with at least $50 million in share repurchases.
ANF YoY Financials
ANF Revenue by Segment
ANF Revenue by Geography
Figures from SEC filings and company reports. Not investment advice.