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Abercrombie & Fitch Shares Surge After Q3 Beat, Guidance Lift on Hollister Strength

Hollister's momentum offsets a sales decline at the namesake brand.

Overview

  • Net sales rose 7% to about $1.29–$1.30 billion with earnings of $2.36 per share, topping expectations.
  • Hollister led results with 16% sales growth to roughly $673 million and 15% comparable sales growth.
  • The Abercrombie banner declined about 2% with comparable sales down 7% in the quarter.
  • Full-year net sales guidance increased to 6%–7% and EPS guidance narrowed to $10.20–$10.50; Q4 outlook calls for 4%–6% sales growth and $3.40–$3.70 EPS.
  • Operating income fell to $155 million with operating margin at 12% versus 14.8% a year ago, and the company repurchased $100 million of stock in Q3.