ANF - Earnings call transcript Q3 2025 | Abercrombie & Fitch Co.

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Operator

Good day, and thank you for standing by. Welcome to the Abercrombie & Fitch Third Quarter Fiscal Year 2024 Earnings Call. [Operator Instructions] Please be advised that today's conference is being recorded.

Now I'd like to turn the conference over to Mo Gupta, Investor Relations. Please go ahead.

Mohit Gupta

you. Thank welcome quarter and earnings our to morning, XXXX third call. Good

our are today Operating Chief Ball, Financial on me Fran Officer; appointed Officer. the Robert Chief Joining Lipesky, call Horowitz, Chief Scott Executive and recently Officer;

quarter is this is release, an corporate.abercrombie.com the investor available Earlier available Also at which Investors website presentation. earnings section. our our on we issued under morning, third on our website

and make the certain statements Please harbor forward-looking on to and keep expectations we with Exchange in and cause Private and actual factors the These to mind could uncertainties mention risks Commission. the Act and we the are of will to reports today. subject Reform These of that discussed safe differ filings that the provisions assumptions are call. Litigation are and Securities materially statements from uncertainties results Securities XXXX our subject in

certain measures be In financial during non-GAAP we'll call. the referring addition, to

are non-GAAP reconciliations and this details Additional presentation issued the morning. measures of the earlier to adjusted release and investor financial included GAAP in

and to Fitch our Hollister Gilly brands. Abercrombie include brands. Hollister kids include Abercrombie brands and Hicks references & our references brands And Finally, to abercrombie

will turn over With that, call I Fran. to the

Fran Horowitz-Bonadies

August busy you both joining all in Mo, to Thanks, thank the and I lines. us holiday during top bottom am that quarter on for expectations financial provided the we a third week. and report proud very results exceeded

of quarter $X.X comparable over sales growing third of and record sales net delivered We strong billion, XXXX XX%. XX%

XX.X%. margin to million, operating to XXX grew expanding basis year-over-year XX% Third points income $XXX quarter operating with

and product, We to voice continue brands. to across our responding regions customers and see experience

customers. and for both Importantly, our playbook new existing delivering is

are compete to this a November, the We and start world have ready strong to we holiday season. around had

the and for of for previous of full positioning these we to for profitable margin at the sales growth end XXXX. operating sustainable well the are raising expect achievement our high be year reasons, target, expectations For our us

important playbook, broad-based an by quality quarter, indicator of our brands to As and growth traffic. strong see and driven health sales regions, third the the continued in across of business we genders

and to We growth we compared also saw in last promotions were unit the as year. to able AUR reduce in quarter nice selling

across flow see newness growth and our XX.X%, customers line a gross closeness continue customer, top profit We since categories, also enabled of This drove healthy profit to gross giving by balanced of a to steady XXXX. the choice. performance, the rate third best rate quarter our

income $XX the XX% quarter. ambitions, the financial while to delivered results in in world. year-over-year of all operating growth customer investments necessary culture financial associate million too, and to our improve discipline or for growth of great produced these adding experience our Importantly, bottom funding the we over long-term the line also true Staying

the and can which regions, the The be in XX%, health quarter. brand respectively, grew Shanghai. XX%, we consecutive EMEA Strong and in Americas, In APAC, with growth our based from all seen Americas grew growing the XX% exciting teams in APAC quarter double digits double-digit across are and sales and third results of EMEA region. London sixth the

their delivered double-digit showing of with and returning new markets fifth team London Our in customers. consistency consecutive growth key in EMEA, both quarter

team Greater local for customers We openings for London new experience see holiday them. tailored have in coming excited to we're store planned has quarter, a number the the over of and the area the how

level. seeing our remains brands the about similar are the QX, small, a For around We're momentum region with strength on APAC, playbooks while each region in at globe, their the platforms. digital executing saw particularly localized excited we high

third third Abercrombie the in on the for growth achieving quarter in brand the brand top XX% the view, sales. brands each a at quarter. quarter delivered of grew Looking net record they from the quarter of in business XXXX, third XX%

dresses, both from category nice in and and to balance and across continued customers. existing the for growth genders. fleece new AUR and Units us, see categories continue contributed contribution to Sweaters, jeans quarter. key were And we

holiday, newness the in all long. customer exciting compelling to will digital to For marketing customers variety see the goal gift-yourself our a with our and season across lot upcoming gift-giving campaigns Coupled social, the and of of give categories. reasons in ideas a buy is

of a the to the Abercrombie where generate a invest channel continue in digital perspective, brand's we From experience, we business. majority

great we're season for are to in are trends around year, Abercrombie holiday the our for they excited and holiday so customers this planning a to open key to this both moment investing choose engage to XX shop traffic the is we stores. season. brands however seeing. and Importantly, productivity We're And and stores locations support we new existing new

strength, Hollister comp. the double-digit in to growth quarter XX% growth year, with also on last top third in the and year. comping is delivered on Hollister quarter to of XX% the Across brands, continue growth we build last

throughout focused teen expanding been reach has market. within quarter. team competitive and in Hollister I outstanding the third entire back-to-school on delivering for the them season congratulate The a our results

growth, unit channels expansion Sweaters, new the both bottoms lower genders. to AUR build traffic Strong selling categories we including both growth continuing across knit from and momentum. we more see and collection. enabled brands And are improved as And promotions. across saw fleece our collegiate balance led the in

moments for other to and engaging continue marketing our authentic teams Hollister Our social, customers through events content. deliver in-person

well in stores. are We as digital as investing

still tend to of they transactions majority their reminder, start Hollister but our a As in journey stores. digitally, their finish a customers

match store Hollister locations, For the the we experience to plan year, around refresh brand rightsize or to aesthetic. our updated XX evolving

Whether new bring digital as items plan we'll categories our stores a on XX in store, as have Hollister core year. style to great to product team around other across and open this holiday seasonal customers. or well comfort Hollister We also to

are Coming starts off right rolling third which week. ready holiday results, into quarter strong season, and peak we this

of reads fourth in holiday come. our us, with so we Most engage in and seeing a of of many and days the to the quarter, can't wait ahead positive We sales have strong the our weeks customers had are start assortments. to to quarter

our activations are well content the amazing stores support have way. customers. centers And teams digital our on distribution and marketing staffed to and Our

the Importantly, meet demand. we have place product right to in

I'd continues be thank and chain products to inventory what a shipping time our navigating to selling. getting market, our dynamic peak like for supply teams in for here

We around compete ready in deliver this confident for to ability are the our season. prepared and to And I'm holiday customers our world.

to with third XX%. our expectations, XX% of in full around Our expect our of now ability deliver Incorporating the commitments. outlook are operating sales range margin quarter our demonstrate growth increasing again we and results on fourth quarter our an to XX%, year

achievement further potential the model. believe will operating of goals strength these We and global underline of our

stores and support Our us ongoing sustainable we are healthy. setting profitable across again in growth growth, And brands up making people, process, key for investments XXXX. are to technology

to him years Ball Scott, Financial we finance, want our recognize A&F more here continue closely I to financial company experience moment spanning at has very we build at Robert decades for worked by look our is Robert. mindset to even success, all it to just journey. He growth Chief we to partnering a Before hand forward live his and discipline Scott Officer. the with Robert Co. With retail to Congratulations, drive closely recent integral more the help as and I take to and on promotion off with than X of me

And such to QX excited off work next for I'm thanks see to hard few for again strong over delivering their team results. pay global the so our weeks. everyone

with And it over hand I'll that, to Scott.

Scott Lipesky

is together Robert congratulations Good I'd a like to Fran. on his the my over to add also Thanks, great and right. CFO. work We've better done to forward exciting of many years, in everyone. morning, take the know appointment to months All lot on it come. him I of role. even time to getting new you an Robert to to for this look

Total also brand sales the growth third into with pleased again third across and we a delivered to with balanced Getting of billion, where and XX% record growth. quarter, last up were year, regions each double-digit for brands. set I'm our performance, region $X.X the very delivering net quarter, which strong

Comparable adverse reflecting of on channel. year, XX-basis-point double-digit sixth growth the in quarter comparable the direct reported XXXX, of of growth On sales comparable saw the our last the in from top selling expectation. sales week grew digital on growth a both the impact XXrd consistent consecutive sales with shift calendar we store and basis, XX% from sales a XX% channel

APAC. China. in balanced growth consecutive way, and the Germany growth and was now On a X by across growth APAC. U.K. led the continued the Americas, in regional in the we In XX% sales Comparable the in net Americas, sales basis, in and EMEA year-over-year to EMEA markets. region. grew Americas, saw In APAC, the for XX% we've lead XX% and quarters XX% delivered XX% XX% in grew EMEA, in In

continued net net For respond and year brands and Comparable was our the XX% continue brands driven quarter. results, deliver to while as for by last strong grew both channels. the sales growing The over strong brand grew digital the third at sales stores each and XX% customers brands, sales in to Abercrombie brands traffic at XX% by to Hollister record marketing. product delivered growth in XX% Hollister. Abercrombie both

rates profit, XX.X% last gross with million from air usage. and costs AURs mostly to $XXX The profit lower year XX.X% was gross higher approximately QX by freight promotions, or compared XXXX. year delivered up We freight to million $XXX due higher in from XX% this offset higher rate

We primarily And mitigate as unit mix is transit and port air with to times sales we up support ocean to shipments to growth. the operate from Each increase to and XX% the of more ready ended half continues due the due brand the expected for combination Coast inventory with and delays higher increased the East is to QX last year. longer shipping inconsistent proactively peak is growth to clean strike. and freight selling. of of and cost in half use potential quarter inventory other inventory Around the QX inventory

of operating expenses. quarter last was expense Moving other income, compared on the to expense, million to operating year. excluding million $XXX Operating $XXX for

leverage, XX.X% a Year-over-year people. with and drive expenses sales and drivers were expense with operating to on and consistent year. of technology compared growth XX.X% of to higher operating marketing, first expenses digital continue variable as half, the last investments percentage We with in expense increased sales growth

points ramp compared up peak the third holiday from basis of around marketing, sales, QX up from to last points as were and XX into year spending back-to-school expenses XXX season. we For quarter basis X.X%

last compared operating in XX% diluted income of income $XXX $XXX or of $XXX million sales was XX.X% $X.XX or up Operating sales to was from sales to last EBITDA totaled million XX.X% of QX or last $X.XX, year. or EBITDA sales of year. per million of XX% million XX% compared year. income Net of $XXX share

investments current delivered On the ended roughly $XX with cash flow we quarter million. and expenditures. cash the million cash and We equivalents sheet, million of capital of $XXX had million of and $XX balance of $XXX operating

half acceleration repurchase $XXX QX. We our quarter $XXX of shares, secured after current first full million repurchased the notes ended share approximately with executed an from on million year we the of redemption in of worth our senior the remaining the We authorization.

Year-to-date, to the prioritize share outstanding shares In the we of market performance, have use and to subject XXX,XXX year. X.X% we to price around the conditions. fourth repurchases of fiscal share as at way shares expect or the primary quarter, excess repurchased cash, business beginning again

stores. ended of remodeled quarter, XX opened the the Through end or have we XXX quarter rightsized fleet, store stores, and the we stores. with XX new third closed stores XX the For

to remodels For the and year, approximately XX closures. XX XX full expect to rightsizes continue new we and deliver stores,

high fourth peak outlook. the for our quarter a week. holiday response selling are period And this strong early We've into and gear ready to to seen the we to kick excited Shifting assortments.

of For X% level fourth sales the billion, be X% the expect of XXX the $X.XX compared we shift a points extra basis to headwind fourth quarter, loss from million of of quarter or $XX XXXX. the calendar inclusive up year-over-year to and in in the of to net range XXXX week

XX% for a to in XX% in the impact year. currency, Adjusting to foreign growth lost last range we expect from see of week the We foreign adverse currency. XXX-basis-point also

brands. We across continued regions expect and growth

be margin XX.X% to expect XX% to around operating XXXX. We in compared

is We promotions. offset expect as driver expected consistent rate the with and QX profit lower primary XXXX operating foreign expense the margin freight be to costs expansion of higher leverage be will currency while gross

For an in high effective tax, expect we rate XXs. the

impact of around level the range we now from in the included of and and impact XXXX. the billion, XX%. XX% growth to year, net year. We've full previous of week of the XX% growth expected the a an to the sales million sales from This currency XXrd of an in adverse the For outlook XXXX include summarizing table of $XX range points to assumes loss or slight full $X.X from foreign and XX% expect outlook growth approximately from for a in by impacts the continues press quarter adverse release in comparative XXX the basis the increase

be margin, to XX.X% operating our previous of XX% This we expect compares around XX%, to high now For last year. range the to XX%. of end

year-over-year to the improvement and combination of to driven gross rate profit leverage. expect the We by continue expense be expansion

an expect the We capital around tax $XXX of effective mid-XXs expenditures rate million. in and

at thank To business. up, a to our executing finish high level the I'd teams across like global for

growth to the forward of our out and We income, have to our operating delivered results model. this season great for for customers and year-to-date another strength of showing delivering our for year both record sales look We company. and finish brands operating holiday

we for questions. are With that, ready operator,

Operator

our Group. Telsey Telsey Instructions] question from [Operator comes Advisory And with first Dana

Dana Telsey

another the any performance? continues Robert. congratulations, it Fran, comps difference only men's women's in if saw at we are move nice quarter. that Where last arc is the to the business And Hollister look as forward? acceleration from in not but successful there you on from second in of quarter, the business, such you and Congratulations year and

you what And last conversation investments for? and we forward, of Robert, quarter. of the a and should how were thinking With then, are marketing, Scott topic of investment components incremental look going

Fran Horowitz-Bonadies

teen XX% just then And space. that Yes, are really comp to and leader be really, of Hollister that to of a XX% of year's point, the growth, that terrific. X%, top your last more XX% they've not that close I in on could made. top seeing the Getting team, incredible of clearly proud customer, progress at we comping on

We bottoms, that regions to categories, and knit saw saw fleece. key balanced as well. categories across sweaters, see We some growth growth of our across excited like in genders

is channels. across new really Our nicely. Again, very collegiate very, collection doing traffic strong saw

regions, et performance balanced really categories, across So genders, cetera.

are So to growth. excited we where continue to see expect to and see

Scott Lipesky

Yes, the investments. I'll incremental grab on the part second

our We year-over-year. teams. from basis marketing talked invest XX We are about very happy more with did execution year-over-year. We the points more

are excited So work, money that. we're to about we and really putting

seeing. to both are been brands. investing just and together, that traffic we're And has that We're talking love what in investments we've and stores, been and Other you refreshes about stores put when rightsizes. we investing in new remodels stores. marketing we're across The and strong channels

So working. that we is believe

we'll we to continue probably we about invest think where year-over-year each As for because marketing, love more QX just brand sits.

is out, And keep and customer digital. in And investments and then other we've something and the about. faster much to in And kind digital then everything been that making for technology we've really excited This on across end the of so for experience. zooming and and leaner front love quicker spans stores talking Digital and journey model just been that business. investing future. doing journey the that this

Operator

Corey next from Jefferies. Tarlowe our question with And comes

Corey Tarlowe

drivers what I wanted felt CFO the and of curious on momentum? Could drivers you Robert you any growth. the us to growth just where the the in of some you're appointment. unpack ask you on Abercrombie was largest you if And maybe touch of to for YPB in Congrats quarter. the also saw could quarter then Great. were the about anything the on seeing I

ahead, look view, as what, think for transient future likely And about as be about think structure? is sustainable to versus profile Abercrombie's in we margin then we margin as for the the Scott, your we

Fran Horowitz-Bonadies

a on journey performance. what is XX% XX% to start has comp been year XX a I growth. to on, of top on XX% on minute, mean of back quarters last brand let's So of just an XX% step really and amazing top drive terrific Abercrombie. And that consecutive with for

see genders. working down, question, well. really, your across really it? comes which across We where To saw to categories. saw do really both know, well and product us and we you for We balanced are marketing, really growth of aligned as It

and that We and to We We nice, a occasions. about lot fleece. talk the nice address weekend. and different sweaters all performance jeans customer wearing continue dresses long in for saw

also in welcoming lots of new existing are to please customers. our We customers, continuing

category to We're nicely. is see YPB. specifically and a grow. continuing acceptance X to growing up across nice YPB is year that continues That finishing very product just

Scott Lipesky

the up is margin believe P&L line, on entire the for you down and sustainable. the platform when profile, a at Corey, we look top the built have P&L, Starting we great growth.

our is global U.S., Americas to we quarters. outside seen our here playbook teams exciting. You've are the drive really multiple in of We which now growth love the how part on continue our double-digit and the growth, for of biggest business localizing

want we line, sustain top to So that.

a we've freight the here very our hit hitting a agile running we talked nature little proactively we prepandemic. part sits margin, bit We're P&L, margin the since a holiday. love that inventory come today. Gross where receipts early of model. brought of call in long I'll growth to We as way our but about transient something

a those on things strong business flow-through clean base store this strong. and digital the business with very and And X a is

that we saw a here really a had outperformed line. to bit, we in QX and our nice the You bottom flow-through sales

So the this want that's love build We and the continue on forward. strength we've to built. future. platform from And going our into year we to model

Operator

comes Matthew with Boss Our next from JPMorgan. question

Matthew Boss

nice quarter, the Congrats weather. especially on a all despite

momentum awareness great. across if the you Fran, So that and overseas? could brands, that and could seeing think you're I November speak brand response seeing you early holiday new business be that on customer elaborate you're strong in to global acquisition And current would

just and your inventory. Scott, gross just basis down maybe third in XQ XX the to break could And comfort of if points you margin quarter relative then expectations the maybe, expansion with

Fran Horowitz-Bonadies

Yes.

excited with for up the could not -- very be put third of the brands performance the well global could we as more we where question, part awareness, seeing performance So so your quarter regions. not I we're just be to about first and balanced as across start brand

We've locally. this talent building on been been us. with You've journey

an localizing office London their and in their response and we're marketing, have We to a nice really seeing those are Shanghai. assortments. They're teams And localizing that.

to excited grow. So see that to continue

holiday as ready. start. the far the get to goes, we As we team are strong always off We walked stores. through a week, Last

It our -- is product here. are We great. looks

a that know have products about. of we tested that's lot We pretty

in staffed our the We're well DC. go, staffed in stores. season. are We're We for well to ready excited our holiday

Scott Lipesky

gross the promotions, we QX. just the All the margin period lighten Coming right, maybe some pull we promotion, off a could quarter, same in can shorten here we approaching QX. QX, time of the expectations, really we to percentage on some Matt, did running and believed like that those we're do offs, believe

have freight. a here little foreign will offset in have an We We'll of with currency QX. hurt bit from

QX. very setup of thinking similar So last And than year. QX, higher again, XX a under in we up points to be again, bridge year will saw in ended in flat We last around the to coming here about basis what water is lot QX.

we where consistent see up, last year. relatively but it we'll end to we're about So thinking

We bringing sits. in we back ago, seen inventory. ocean We've great receipts our a some were to transit. dynamic proactive in on I the variability here shipping minute the where in Moving mentioned feel been environment has about inventory in. The pretty half.

in deliveries, taking and the our chance So we are inventory of early. brought we out that

again extra freight usage saw little here a QX, we have that that, expect here that with QX. and in there We in air we

half there freight. the product we're that into apart to half Abercrombie up due just XX%. the is that in to inventory, higher-ticket some drive of break unit and is and growth growth, a little you other About when But mixing

across holiday. well and So the really for we brands about clean really inventory, up set good feel

Operator

comes with Our Lejuez from next question Paul Citi.

Paul Lejuez

and curious as the Abercrombie what turnaround different answer how A&F continued momentum, U.S. act Europe after and see and that. in that you you about for multiyear the Fitch opportunity in Fran, versus next & Asia think you might as the I'm the versus

to at And are repo look And thinking is 'XX that quarter, if but just expect XQ, of beyond? just out just and how pace year-end? about not of for the then, fourth Scott, cash we what to you level as we numbers hit you expected have -- in your

Fran Horowitz-Bonadies

question. with start the of I'll first your part

here Fitch, & consecutive an I quarters what's journey Abercrombie. have incredible to take at a to moment just what Abercrombie So just you know happened again, and XX amazing of say, growth,

question, what's that a addressable our of we With driven to changed lot market. said, answer that that, really is your

We are company. a T-shirt jeans really, no brand. and longer We're a truly lifestyle

into to well us in comes They stay XXs. now, early consumer their The XXs. their

is important Our very, is well. moments working very life staying and so team customer. to just the customer The close those just for the really what's marketing to with aligned

We've gotten into A the some categories the continuing fourth YPB, licensing, guest. certainly our are dressed into of those best lot quarter, like future. into our new

future. we expecting we would So are profitable that what year, sustainable delivering and go into we the growth this said to do

Scott Lipesky

Yes. And A&F want to add there brand. on the

there U.K., & in business, pushing London, next And second efforts up has quarters now, we As European local our specifically great brand that our been Abercrombie started Europe. consecutive X reintroducing is new Bringing that think in the Western about country We've to marketing consumer. the really seen we've really of in Fitch to biggest that brand growth exciting. and market Germany, there our growth.

about of that excited brand and of really driving days growth the So U.S. awareness early the outside

of a plan, dollars given bought work to would all it than the sheet super QX, Jumping $XXX there back in to million haven't the if second million hundred But cash we year-to-date, paying will QX. of goes so today, strong. what million and to cash more balance share really remains couple exciting. lot this The say good a repurchases. of We and year, I of be debt outlook $XXX then there for put shares down is an for half, cash, that's

have do $XXX million We on authorization. that left

back our hit the flow-through, cash. put $XXX have buying work, As or we've a here cash in operating to investing flow We generate about And we cash it's nice can of million year-to-date. forward, generated think clean we set whether model up targets, business where really shares. going

So really excited the position in. we're

business the stronger every flexibility have to We make day. nice

Operator

Tracker. question next Shapiro Our Retail The Marni from with comes

Marni Shapiro

have one quick are I just stores The housekeeping absolutely stunning. just Congratulations. question. stunning,

just count? I What looking remind was of an releases. all quarter, the at store store count Abercrombie? could of break us through do you international -- end the actual was And and the Hollister this you the out If

Fran, has then is customer. And And definitely had and media Hollister social exceptional I'm playbook the just, an a curious, with younger Abercrombie influencers. customer

to their as So control. customer, and younger playbook thrilled what I'm aren't and little just them maybe curious have use though looks parents with bit if being you're kind like a that able you curious I'm guys. a for even similar they it's a of still of on,

Scott Lipesky

Marni, I'll us kick off.

store at So the XXX end count, of the third quarter.

For then Abercrombie it, versus XXX globally. stores plus we had think you had U.S., kids, we the stores When XXX, round And globally. international, about XXX for Americas it, Hollister, about XXX call numbers. call

the kick I'll second you it to Fran, one. for

Fran Horowitz-Bonadies

Yes.

So at And about Hollister. what's It playbook. been our certainly to learn. we've aligning certainly We there's all of that applicable It's thanks, our exceptional lot our globally pretty is voice product, applicable playbook, Marni. talk lots and also a exported as experience. has and A&F, happened to

that been real-life augment in do things with successful. doing festivals high have events. like we schools We're Hollister, for very at it Specifically

it's and So a good for and their combination parents. on as things life real digital both being well balance platforms for striking as a the in consumer doing of

Operator

comes Morgan Stanley. Our Alex with Straton next question from

Katherine Delahunt

Straton. Delahunt Katy is on This for Alex

changed have guidance ago. sales or implies were on profitability year positively months Where either banner more margin, most by optimistic and geography, SG&A? gross on that raise than you're your assumptions full Your you XQ X

Scott Lipesky

to than in and and fall for specifically started selling bullish season strong today we period, seen quarter the more a Obviously, We've performance months Katy, Abercrombie that throughout gone then the back-to-school weather ago. we Hollister X grab the are Fitch got for I'll have and cool months by. X bit. kids as one. & Yes, of into a kind this

customer we've think great has you And We're been seeing about when to really, start QX to previously. was this earlier that respond to We today, us tested year. taking fourth that to marketing across implied versus what in strong much number across had product gives we and the talk feel a regions. continue quarter. assortments, the which are the of up our And where about about confidence brands,

number talked Breaking last about of apart XXrd little that we growth last a week year. to QX X% X% reported had bit, We a year. around

when play of some the to foreign we're and that take XX% out this So digits the still, double about growth talking you low XX%. in currency,

growth up here here continuing across for regions brands. our for see sitting and and think set QX, we So to That's success today. expectation we're

Operator

from Serna with comes Mauricio next UBS. Our question

Mauricio Serna Vega

new Great. the I about you're by concentrated -- the each these are to across year. wanted Where that where opening stores this brand? ask like region openings just are store

could regional basis just about thinking a or then what And about talk either sales AUR? comp the acceleration Q-over-Q drove growth on units Hollister acceleration, like that you and

end inventories sales should of And last on -- this and inventories, think explanation going thoughts to forward? I could where understand that at of your the should be Maybe you they kind of at year do the the quarter. you ending you growth the at end the relative on see why look on high share the end should be

Scott Lipesky

is one I'll this this kick Scott. Mauricio, off.

new So let's start stores. with

for little remodels, about Fitch the Abercrombie this bit mentioned new tilted U.S. bit & year, is our store Hollister. refreshes little We rightsizes, and towards a So a growth XX tilted then towards

getting really fleet. that So into

and remodels those to that in rolled started at last prototype Hollister. some of we time, year out press around new this We really

really excited putting year. all us beating a this So and or what new in refresh, our new across and exciting in rightsize it's of about strong again The store opener we're be seeing brands, to been store whether which expectations, really have net our place stores. is remodel, a performance

for... kick Fran, you to it I'll

Fran Horowitz-Bonadies

one. take this I'll Sure,

as acceleration growth. we're I'm delivered. driving super sales well a the just amongst that a comp back-to-school close result excited broad-based the It just the What's as is Hollister seeing that customer. about balance So genders was the we acceleration, to of categories, really and staying

by year, a the bottoms of our collegiate had it. which We sweaters and are really categories the couple key launched customer. acceptance and fleece for this collection terrific A back-to-school driving like knit

strong again, balanced a traffic So balanced across. channels, very -- just across very, very

Scott Lipesky

All right.

So let me side. finish the inventory up on

last we So about this up be at to to no provide will point. year. year-end, It number think

QX into expect brands to We XXXX. from continue our 'XX of as grow to move we

from get QX The how freight swing receipt in we to had air usage plan. is over in there much here that left our be holiday to will the

So looks we'll see like. what the sell-through

it more So up we'll would lot expect into year-end. we growth talk -- be as again, to a But QX. at we we to go support

Mauricio Serna Vega

Congratulations. Understood.

Operator

question next with from James. comes Raymond Patel Our Rick

Rakesh Patel

on role. the about regions from AUR And do brands? the further, and you're view any mix AUR the opportunity seeing? for across Congrats about we to strong going promotions outlook also new sales you demand to talk forward? impact the Can do you How then on given the reduce how think changes Robert in

Scott Lipesky

Rick, I'll grab this one.

as as Q the same in we So pull or good Nothing to off felt able continue gross opportunity came think the had We were we feel to where to we margin about brands. about feel here. for We we point, across but some that. sits promotions. XXXX to talk as the we QX, -- AURs, do at QX like this walk into into

In terms those proven. that before, those holiday right things. it here said product in floor comes acceptance. I levels sets. early of seen acceptance we now It's the of been things both business. of tested A and with X lot have in Like down inventory to reducing the nice promotion, has product and happy We're quarter, product

here QX, we that confidence off So in take gives of can those some promotions. the us

that from zooming out, call but we bits of there, QX impact that's When across pieces and beat in sales enabling that gross here AUR not and about just you strong, XX%, here not material top that about it's something out talking enough we'll really flow-through, a super brands even line. It's think and margin great mix regions, much.

Operator

comes Our Janet from Kloppenburg next with JJK Associates. question Research

Janet Kloppenburg

you're acceleration in I talk improving terms the margin, go top the room Fran, maybe seeing the performance. there has given that in you margins, brand wondered real more good line could there. to the the about Hollister and on Congratulations margins contribution of if

Scott, next And when -- there single-digit freight, what's that down question. go as think going one look we the is year? at just we you'll think we When possibility a levels level cetera, the on remain double-digit and I about understand inventory, think forward? with on inventory, should to we you'll et Or

Fran Horowitz-Bonadies

strong. very Hollister pleased actually our with To start are Hollister question, we They're with very the margins.

seeing productivity. you digitally consumer, our really most I also journey in terrific starts of know, and increased been very store. it really business That as stores does strong. are their mean We has

being seeing traffic strong we're channels. driven So both lots to of

So pleased.

Scott Lipesky

second part, Janet, the on Yes. inventory.

goal, growth the want more our That business. up year. will signal next to So inventory in we be

tell. to So too early

Again, as that's much you freight sell year-end. to going a lot have more inventory next have year-end. how we to more assuming year, today. we're that mentioned talk in through we we'll see see about We'll the at inventory it, growth and to the get we But

Janet Kloppenburg

you, to Robert congratulations And Happy Thanksgiving. also Okay. And and to Scott.

Fran Horowitz-Bonadies

Janet. Thanks,

too. You,

Operator

Dylan from comes question next with William Our Carden Instructions] Blair. [Operator

Dylan Carden

flexibility it, that much? some point? insignificant kind mentioned of weather it was this the instructive you there. Someone is not of out of disruption the didn't more at amount to embedded you as there Is it Or see business as into

quarters sort current sustain year commentary seems past would incremental sort of looking to point? around curious of predicated maybe that your business was of structural But of does imply of sort a to certain these that I'm sort the double-digit several quarters, I low square your amount in you're the more the And growth core. What margin low that's level just medium-term fine. a even of on curious, maintaining rate footage on double-digit growth. capturing or be kind relative entirely And this business growth, at of

Fran Horowitz-Bonadies

with We'll question. the kick off weather

being for we weather to to reason our generally So business. look a do not

We've global any a business. world. around the stores are at very We weather We're given time. diversified got

Balance your I to sure weather. The things team tell that balanced. business like control is most upon can't that will we to are drive important thing that make assortments the continue the dependent

Scott Lipesky

Yes.

margin about mentioned the at discussion, that are algorithm, brands little early, we healthy. but long-term yes, a our Looking thinking

flexible. Our and operating agile is more model

store we've XXXX, by have that out long base so million took And bigger that in more right over in business, square broad a right million the able square about base Back than now. for the mentioned. around X we years time. store been feet in adding X think add store places, to there. we base ones, we've out stores at the our some in over We've malls you long, across few in had a we've been X smaller taking And feet You million. much ones, a stayed

really that. excited about I'm So

stores very of And these new is strong. the performance

are paybacks, margins about or stores. returning to XX%. EBIT X-wall the talk strong operating stores margins above for These We continue quick

So if adding trust that we're the total. us stores, to opening they are

of opportunity. it, global growth you think then the about And rest

We have stores.

We outside have growth U.S. digital the of

that recently. seen You've more

We continue playbooks. to localize those

gets that excited. us So

have you that, behind And sheet. balance a strong

across channels sitting here continue to excited across the future, So and growth we regions, invest can into that drive the why today. so that's we're

Dylan Carden

of guys XXXX, quickly you China pretty mean to Then you taking of good can sort as in is see the you comments ramped tariff what just down that job guess? plan ask in any of And tariffs? might a like that in move really sort did you kind be years. 'XX, production. question, should XX% in it. up I recent Got I the And still? I Can it

Scott Lipesky

question. Great we it talked And taking XX%. never We up. down to our back about Yes. yes, ramped it actually China,

know It had it were reports hasn't So out that there I some ramped. ramping. there

X% about now, our right into of X% the today, So China United U.S., import into the to from we States. receipts

half small business, very of that that a piece of XX% out. you our So called

know around night discussions tariffs some about were there and Canada. also I Mexico last

us, for anything into grand in from scheme immaterial in coming we for Just the the And Mexico U.S. coming don't Canada. was us have

the what news, We're now, just else. right like see we'll happens. following So everybody

an have team. awesome We sourcing

in And have We We continue excited diversified, a have tariffs new of supply countries, flex future. if agile out in come and point source future. chain. that to partners we're we'll at great globally. some playbook muscle when play the to in the And XX

Operator

remarks. time. at I'm turn now like I it to showing no Fran for this Horowitz would further back closing questions to

Fran Horowitz-Bonadies

a all call soon. to holiday today. to we to updates I everyone, you joining you just more you. forward wish Thank of all Thank look season. the happy you, providing want for And

Operator

concludes call. you for This conference participating. today's Thank

now may You disconnect.

Abercrombie & Fitch (ANF) 26 Nov 242025 Q3 Earnings call transcript