Abercrombie & Fitch Reports Mixed Q1 Results Amid Middle East Conflict
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 4 days ago
0mins
Source: CNBC
- Sales Decline: Abercrombie's sales in the Europe, Middle East, and Africa region fell by 10%, directly impacted by the Middle East conflict, which reduced overall sales growth by more than 0.5 percentage points relative to expectations, highlighting a challenging demand environment.
- Lowered Earnings Guidance: Although the company reported Q1 earnings per share of $1.47, surpassing the $1.28 expected by analysts, its guidance for the current quarter is set between $1.80 and $2.00, significantly below the $2.54 forecast, indicating uncertainty in future performance.
- Full-Year Sales Outlook: Abercrombie anticipates a net sales increase of 3% to 5% for fiscal 2026, with overall sales rising by 2% despite the slowdown in EMEA, primarily driven by new store openings and favorable foreign exchange rates, showcasing its market expansion potential.
- Reduced Tariff Impact: The company expects tariffs to affect profitability by only 0.2 percentage points in fiscal 2026, down from previous estimates of 0.7 percentage points, benefiting from the U.S. Supreme Court ruling against Trump's tariffs, which further enhances its financial outlook.
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Analyst Views on ANF
Wall Street analysts forecast ANF stock price to rise
11 Analyst Rating
6 Buy
5 Hold
0 Sell
Moderate Buy
Current: 82.180
Low
95.00
Averages
123.67
High
160.00
Current: 82.180
Low
95.00
Averages
123.67
High
160.00
About ANF
Abercrombie & Fitch Co. is a global, digitally led omnichannel specialty retailer of apparel and accessories. The Company offers an assortment of apparel, personal care products and accessories for men, women and kids, which are sold primarily through its Company-owned stores and digital channels, as well as through various third-party arrangements. The Company’s brands include Abercrombie brands, which includes Abercrombie & Fitch, abercrombie kids, and Your Personal Best (YPB), and Hollister brands, which include Hollister and Gilly Hicks. Its geographic segments include the Americas, EMEA, and APAC. The Company also offers its loyalty programs, which include Abercrombie’s myAbercrombie and Hollister’s Hollister House Rewards. The Company operates approximately 790 stores under these brands across North America, Europe, Asia and the Middle East, as well as the e-commerce sites abercrombie.com, abercrombiekids.com, and hollisterco.com.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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- Shareholder Return Plan: The company plans to return $450 million to investors through a stock buyback program, with CEO Fran Horowitz stating that strong cash flow and double-digit operating margins will support this return strategy, further boosting investor confidence.
- Improved Earnings Outlook: Although earnings per share fell 8% to $1.47, it still exceeded analysts' expectations of $1.28, and management anticipates that tariff-related pressures will ease in the coming quarters, with a full-year net sales growth target of 3% to 5%.
See More
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- Optimistic Future Outlook: CFO Ball projected full-year earnings per share in the range of $10.20 to $11, with net sales growth expected between 3% and 5%, reflecting confidence in future performance, particularly in developing new channels and partnerships.
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See More
