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4mo ago

American Eagle Withdraws 2025 Guidance Following Q1 Loss and Inventory Writedown

The retailer cites disappointing sales, a $75 million inventory charge, and economic uncertainty as shares fall over 17%.

FILE - The New York Stock Exchange, with a banner for American Eagle Outfitters, is shown on Tuesday, Sept. 17, 2024, in New York. (AP Photo/Peter Morgan, File)
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American Eagle clothing is seen at their store at the Woodbury Common Premium Outlets in Central Valley, New York, U.S., February 15, 2022. REUTERS/Andrew Kelly/File Photo
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Overview

  • American Eagle expects Q1 revenue of $1.1 billion, reflecting a 5% year-over-year decline and a 3% drop in comparable-store sales.
  • The company reported a $75 million writedown of spring and summer inventory due to weak demand and heavy discounting.
  • Q1 results include a projected $85 million operating loss and a $68 million adjusted operating loss, far below prior expectations.
  • CEO Jay Schottenstein acknowledged execution missteps, including ineffective merchandising strategies and excess inventory levels.
  • Following the guidance withdrawal, American Eagle's stock dropped over 17% in extended trading, reflecting investor concerns.