URBN - Earnings call transcript Q4 2025

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Operator

Good day, ladies and gentlemen, and welcome to the Urban Outfitters Inc. Fourth Quarter Fiscal '25 Earnings Call. [Operator Instructions].

I would now like to introduce Oona McCullough, Executive Director of Investor Relations. Ms. begin. may you McCullough,

Oona McCullough

the welcome forward-looking Earlier URBN statements. issued this the results following materially results release and January differ period XXXX XXXX. may Please XX, a Quarter note Conference outlining The for operating and Call. afternoon, may financial those and to afternoon, XX-month Fourth ending include the discussions Fiscal press X- statements. Good from the actual Company that

projected results information Exchange to from Additional factors differ filings Company's cause that Commission. and contained results actual is with concerning could Securities the in materially the

performance For please the more detailed Relations commentary on our to of our website call, quarterly conference www.urbn.com. and today's Investor at text refer

now to call over turn Dick. will the I

Richard Hayne

record surpassed sales, of fourth profits, both Thank expectations. our year quarter We're you, Oona, and a afternoon, full which good everyone. announce pleased to

Speaking today's of first Frank Conforti, you Co-President hear from will those and COO. on our call, results

talk 'XX. Frank. remarks, current be will Frank, CFO, our your questions. to the expectations Melanie now closing brief about my I turn fiscal will call for we to after address over our Marein-Efron, pleased Following will Then

Francis Conforti

presentation and asset a adjustments that investor in our noncore these Thank method for as fourth you, by the today, press detailed lease results well results on will good which tax of impairments, the not Dick, change year, basis, I detailed Nuuly. do prior to quarter more by posted in as be our include followed some versus abandonments, to of brand. our total Please revenue everyone. reserves, is our financial will notes Today, discuss year URBN items and prior Each note, release is speaking Company I afternoon, an adjusted at a income the release recognition

investor relations website.

results. our on Now to

QX well, record the Overall, quarter a sales. call. the fourth performed by remarkably Four five conference URBN third during plans quarter, discussed posting X%, delivered sales reaching of of our our record $X.X brands grew teams Total surpassing as billion. exceptional another quarter

DTC Outfitters and Urban X% a brand the retail 'comp' a Anthropologie in low by due 'comp' made segment's driven sales People a reducing prior operating increase slightly achieved progress Both their year, the single-digit trend. Free improving partly significant URBN and brand's the a store Retail was Additionally, sales by 'comp' high in single 'comp'. high a single-digit loss Urban versus to segment decline the 'comp' low and brand. Outfitters channel positive offset at single-digit growth

year. thanks subscribers a Nuuly delivered average roust in revenue increase double-digit XX% the to to growth, prior active compared

sales segment rise driven the by revenue saw healthy a increase, in Additionally, People. Wholesale a XX% full-price at Free

Now a markdowns at turning URBN gross year. to the year's dollars, fourth This with in increase the nicely a by lower versus reaching profit to last to also record year, by an profit in driven the XXX in current the of on gross improvement segment, top margins reduction Anthropologie. Urban rate a primarily The across point better with basis $XXX way is all by points a saw gross quarter The gross gross markdowns in improvement followed leading rate XX.X%. segments. Outfitters retail improved increase XX% XXX prior was improvement significantly basis million. The profit rising profit. in due

Free segment from Anthropologie Retail People. initial the margins both in and Additionally, gross at margin benefited increases

growth of to Anthropologie, in in People, Anthropologie, campaigns FP to by while leveraging growth Free healthy by store driven efforts primarily The Newly growth XX a In SG&A Nuuly's Movement for a dollars and the marketing resulted points The Anthropologie, and SG&A brands. marketing Movement, spend, Movement quarter, fourth traffic Free and sales. rate boosted channels, basis subscribers. brands. in and of Free increased Nuuly People, the the double-digit efforts as fueling both X%, FP The digital FP average by increased People active marketing sales was

'comps' diluted last million, compared income X.X%. Total XXX XX% reaching Net increase year, operating $XX a over $XXX by points XX% while to report channel. income category quarter digital the rate to rose saw growth. and basis in mid-single-digit are million channel also operating URBN to for strength the to share. I its sales team improved Home operating a that total with Positive double-digit positive by profit driven I now broad-based during per by an starting increase of exceptional details store 'comp' another team The across delivered the more apparel increase Anthropologie regular brand, Anthropologie first 'comp' sales price Anthropologie. $X.XX ninth in know the quarter posted 'comps' straight price positive Tricia very and or will and and quarter All the provide year-on-year with year. by income proud Retail a segment X% double-digit categories were delivered categories. total their regular with and the

on found and meaningful year-round the round. forward. and expanded products to Daily could continues believe of continue of which an be full execute of Celandine, categories in locations wear brand's expanding and experience Celandine, Practice, styles, offering serve customers' assortment growth vacation-ready team growth launched can lounge seasonally end-use-offering be online the year outsized to intimates all and moving to Anthropologie their In in-house resort January, label lifestyle. strategic initiative Anthropologie their exclusive The

and growth and for new, Additionally, total in with customers deliver our full which believe could investments brand quarter. goal content, of the succeed fourth increases marketing support traffic outstanding quarter. current deepening plans, strategic we record positive and The in to the the younger on mid-single-digit continues first existing for segment Anthropologie margin make attracting drove positive an fiscal Anthropologie the for drove increase Retail dollars Based year quarter digital Impressive operating expenses, profit on well-managed 'XX. a 'comp' continues expansion coupled as of sales healthy their creative engagement as ones. well to store in brand customers while with XX%

driven sales increase in by wholesale a 'comp', double-digit 'non-comp' in continued The by store segment segment driven increasing low store a was sales, X% team with outstanding single-digit Wholesale 'comp'. Retail The sales Next, the increase another People quarter Free People a an driven new retail increase XX%. XXX% 'comp' produced Retail total XX% by Free and was double-digit positive 'comp' segment DTC segments in successful and openings.

During XX increase the FP opened categories. store Retail months. by over growth quarter, XX A the XX% total Free People all base, People by was FP driven segment while delivered brand major Movement the positive The quarter, FP 'Non-comp' achieving Wholesale robust XX% brand achieved sales sales 'comp'. a last Movement across in new segment FP XX% in the growth Movement year. growth of locations the XX XX% driven X Free Movement and versus exploded growth over stores, 'comp'

exceed Free the the could could growth opportunities, 'XX. current Free have outsized we specialty year in a segment Movement, plans, driven 'XX. continued sales revenues the channels 'comp' Free which driven in part to in 'XX. mid-single-digit FP The Based in the full People that by products. Free the mid-single-digit open an will Group for year significantly brand People believe We deliver on sales fiscal from expansion in when while People year brand for year, continues close-out quarter and utilized to growth aging full to and believe locations price deliver profitability our by improved quarter stores. additional of the Wholesale new increased retail full during low the reduce fiscal quarter, Wholesale for Wholesale XX% department prior fiscal positive the first could range first People XX gains

Retail I'm single-digit offset segment Now Outfitters This the 'comp' Urban moving a negative was single-digit North on Europe, healthy for in 'comp' the quarter. high America. 'comp' recorded trend to 'comp' the improvement in year a Outfitters in decline in positive a Urban by by the current brand. driven X% high sales

significantly pleased merchandise brands growth the sales to performance, a and loss margin driven an selling. to on the continued are regular led in the the markdowns price we last in 'comp' addition by rate, In compared to improvement with improved reduction This lower year. in

to In women's strong realigning were This of fiscal the strategic North business, in regular key home, performance and as as and within rightsizing well loungewear the the the denim and delivered accessories years. brand third The year, was Last North of marks North stabilizing which categories improved apparel. result trend women's the X first 'comps'. profitability in such price priorities the 'comps' fourth due positive led as in in quarters has 'comps' 'XX. on price positive focused margin over meaningful improved inventories team American time to maintained the America sales positive America, growth and

applying while the growth as into upon start to with new team team well women's of renewed apparel, regular a price Within introducing building growth. pivoting on athleisure. beginning solid is bottoms other the focus and as we denim the lounge is As growth, categories year, learnings

in they are confidence brand the progress full strategies, it making. team their the is have to and see We encouraging

to Europe. Turning Outfitters Urban based in

Our single-digit channel business positive 'comp' delivered 'comp' the by a European a a digital double-digit store and channel. driven in in 'comp', increase increase the high mid-single-digit

team. the a sales margins Based operating current across 'comps' European our fueled improved and drove brand profit quarter, 'comp' the on the and positive home During Strong apparel, for accessories. healthy maintained Urban positive quarter full in flat to fiscal global for 'XX. Outfitters 'comp' deliver flat single-digit 'comp' the the believe we to for could first plans, negative low low brand single-digit the and year a increase

over Its rate added Nuuly fourth average delivered quarter. almost revenue active the revenue. line the another expense first the and subscribers first. for XX,XXX every average third growth record year which operating The Finally, of ending profit Nuuly leverage full deliver the versus for I item, business, another year. solid fourth a profit full to will in Nuuly part subscribers in quarter, $XX active full recorded operating in quarter year with on helped a led XX% growth expense in the mid-single-digit subscribers strong brand quarter. profit Nuuly in increase operating in touch quarter profitability. the exceptional and XXX,XXX million average quarter which rate of resulted The

significant Nuuly experiences for profit noted, bodes seasonally in fiscal continue we in As Nuuly first growth have and first subscribers to 'XX. revenue brand deliver healthy the the and to year already the of strong well in third strong An start and during growth most full February historically, quarter quarters. the

call turn the to now over Melanie. will I

Melanie Marein-Efron

quarter following and adjusted afternoon, Frank, 'XX. full certain you, year discuss Thank I and year statements items. full and fiscal the will first for to The quarter on first On reflect 'XX forward-looking our everyone. one-time comparison today's thoughts good results call,

could 'comp' As to segment 'comps' begin mid-single could to brand and low at we mid-single-digit primarily by growth believe segment mid-single-digit Nuuly digit the full and that continued year. driven retail believe This single-digit driven growth as low Anthropologie. positive quarter year, year 'comps' be improvement 'XX with FY single-digit for Free Retail the segment quarter Outfitters first segment sales we negative People for Retail be growth the first gradual we at growth. retail deliver full with positive could year, the We revenue first 'comps' 'comp' subscriber driven brands deliver Urban flat progresses. by could and quarter

the segment for could growth. first low Finally, growth to planned year, mid-single-digit is while our the revenue wholesale achieve double-digit quarter deliver

as our on be profit delivery on year sales our believe in we increased could growth the drive sales quarter SG&A increase and store primarily FY and margins expense and in sales growth profit merchandise plans, the with occupancy in Urban plan, marketing first XXX to to line by related first expense could support performance quarter dollars last store improve to leverage. at The full and for in 'XX. and well relates customers markdowns needs current versus our followed higher basis growth Outfitters business. lower to rate gross in year. believe financial The total current the Based growth gross could year the in grow performance to and sales, as investment SG&A of costs we brand, for the due XX labor points and Based technology primarily openings approximately

variable can level and how As fluctuate our depending if is we we of a certain spending up maintain down that SG&A fluctuates, performing. business performance sales on

approximately be and to the planned for XX% is the year rate quarter. first tax XX% effective annual Our for

a We continue or to believe be that a slightly Coast with of moving year, the FY inventory impact We levels inventory. ended East turns. growth. grow we we at early on at our In focused potential increasing on avoid intentionally sales brought coming inventory will strike. our product in Now elevated levels rate to could 'XX port product as to below the

to and For planned supporting remaining is home approximately technology FY as support. FY to to $XXX the million, spend office is XX% our and businesses. related approximately Approximately support 'XX XX% is store investments, expansion capital expansion at growing 'XX capital expenditures retail the broken project and is are related follows: for XX% down logistics

and XX approximately 'XX. stores new be during closing stores opening will year XX We fiscal approximately

by new net in is growth Anthropologie growth Movement, Our and being driven FP store primarily Free stores. People

we current plans, FY During may XX least opening FP Movement shares FY People our dilution we Based to in at stores, 'XX. XX stores offset 'XX, repurchase any on XX occur to Anthropologie and on plan Free that stores. plan

share course, contingent on will market and of Of authorization. Board repurchase conditions activity be Director

does As a reminder, but reflection statements. disclaims is forward-looking a not the of a update our any foregoing constitute views. The simply current forecast obligation to Company

my is to back turn URBN. to it pleasure Executive of Dick call Now Officer Chief the Hayne,

Richard Hayne

gifts. distinctive holiday congratulations was Thank for exceptional, to season eager with you, and Melanie, team fresh quarter. fourth outstanding and The consumers for our fashion an

Customers in-store gains drove well-executed Our assortments, business responded campaigns. all brand teams across and segments. our marketing experiences and revenue inspiring strong created captivating

for prior year discuss versus now will 'XX I year our fiscal results. performance

year, X% $X.X points, the nearly profit. in earnings same to our $XXX impressive in per delivered drove to share in and a easily we gross which increase by the record 'XX growth, This, adding time, profitable At I made market XX% grew $X.XX billion. lifted URBN that demand a turn, an exuberant. our most XX% revenue by year reach has the For XXX basis FY enthusiastic operating and customers profit In latest merchants rather assortment create million, margin segments. and hungry mood please I gaining product fashions today. year, for They're them. designers remarkably believe continue the consistent. increasing short, share new than remains described this Last our accurate to remained and we're history. and as description across all Customer customers' of

more this stores segment, sessions to to and Retail traffic grew digits. In our single web the high For by FY websites. translates 'XX,

over active means it by total new had increased the at average our year. For active for XX% XX%. segment by subscribers. wholesale added more XXX subscription rental more increased accounts year's The and And subscribers Nuuly, capturing end, than segment sales

With the are to record grow, even start a counts good produce results. optimistic sales will to continuing of spring 'XX off products subscriber and that fiscal more we

are to URBN All adding total portfolio. brands value the

nicely expand brand consistent continue operating demonstrate market People most in shown and revenue both are two mid-teen today. and Both biggest Anthropologie brands, FP and Free Nuuly potential margins. of Our exciting the movement scale two have the growth profit produced the and concepts healthy and are profitable further. high-growth to awareness

entire FY for brief to half that opportunity drive while hiatus driving Outfitter Urban America stabilized excited the North after revenue showing Europe, in customers brand focused in sales portfolio sales. 'XX. solid We're Urban posting profitability. In of Lastly, now beyond. FY is first and on and has by a margins. success. our acquiring see expanding improvement 'comp' We I'm in of 'XX the poised full-price is growth brands. has recent and again strong The team URBN is confident profitable new once continued

and and congratulate teams, brand also XX,XXX Sheila and And our teams efforts collective and our operating our Dave, Frank, I creative produced Trisha, many record year, Shared Their leaders, worldwide. their I thank I I our another in thank finally, our thank and for and Service and merchant, closing, In globe. our recognize shareholders associates the thank their partners co-presidents, support. continued them. Meg

over call for your now prepared the concludes turn I That our remarks. questions.

Operator

[Operator Instructions].

the of question Our America. Hutchinson of is Bank first Lorraine from line from

Lorraine Maikis

about of line? had we your basis opportunities you next You IMU around year. should to by set the improve And the IMU XXX what that by hit goal? for points a goal last Did end think

Francis Conforti

Hi, Frank. is Lorraine. This

are fall over there. our the of sourcing we the we we work our progress brand our the Each opportunity we still obviously, by of years, delivered So logistics past honestly going feel did driving X final initiative. supported goal, just to improvements year there's about growth that as additional to mentioned, teams short meaningful think still years. We in that but continue made. great And really completed and just you we coming and IMU

Operator

moment question. One our next for

question comes Citi. Paul next Lejuez the of Our from line from

Paul Lejuez

own private maybe each? about expect strategy we what this Outfitters is on year within forward? any branded or of and the mix? Just if penetration the the you curious And brands for versus going talk businesses? Anthro product Whether just should -- where brand mix that Can curious Urban changes is

Richard Hayne

going to to the Paul, Shea ask the along to I'm Okay. talk side the take pass of urban and then to question Tricia about Anthropologie.

Shea Jensen

growth the we the Paul, because of in for Outfitter's total brand non-apparel seeing we're in question. growth the Urban see brands QX. Hi, categories. We're year that outpaced the growth. from apparel excited did necessarily a Brand national penetration. about We question, our lead brands But know That just times as thanks come actually mostly don't strategies. of terms what's come. growing we're your and in to customers, excited is We to of our to target part important but this we about look per it's that

let customer and have we're big about made we're think some we the that But QX. excited I guide brands excited up, about the we're of going lined we in the progress us. to

Tricia Smith

Growing strategic This has penetration growth for driver own quite been Tricia. at Anthropologie a is us some our time. for brand

looking and growth continued plans XX% feel have outsized Maeve, in now We our Pilcro growth women's a denim brand -- for. and hit we've penetration our seen opportunity. customer that like the our We've own from there's at growth favorite. #X continued brand got We're brand. apparel significant

great that driver it's will ends. for to. growth more still see will be with is continue So market overall, the a and it than remarkably us, we it because I increase around opportunities know don't But believe it penetration we currently to continued

Operator

moment next our for One question.

JPMorgan. from line Our from of next Boss comes Matthew question the

Matthew Boss

just categories see this off year elaborate could you good on just to could through and do see position maybe you start, speak trends sales to near you term, to a spring that emerging across this capitalize? weather. you if And how looking maybe more Dick, So notable any

Richard Hayne

Okay. for selling baggier, Matt, cycle, one better. all in try to We're I'll a the it. there's bottom brands and Fashion, our very briskly bottoms really, do are that. the and word of

to in fuller selling well that are require tops over silhouette. so order complete the big slimmer bottoms Now little also the

that. of been So given it's us performing number be briskly then, big nowhere climes. we're a very Northern the now and to horizon new cold as on FP activewear are Also performing in change resort well. Practice Celandine selling shoe see that for Anthro's sales. outerwear, for are of course, of our as Movement the both well, That's of Anthropologie's for a called I the surprise been And on years. a tops don't any how shouldn't dominate but concept going near bottom. well. continue Daily concept Sneakers is performing also very number And

And finally, furniture, both selling. gift as at categories and Outfitters Anthropologie are Frank home and full experiencing mentioned, strong Urban excluding price

repeat So mid-single-digit the if are for it it 'comps' QX I which Frank to People, for selling, that can of by low mostly plan gives the we an now be will Anthropologie, will 'comp'. do you to believe what 'comp', be about a I mid-single-digit idea just a low said, brand, is range. And mid-single-digit to and our in for Free

QX negative to call. a quarter. a on the I little this the that to little bit And can we positive finally, too People year, will and want the a think difficult XX% brand. be 'comp' difficult 'comp' from It up there, against Free on bit side, of it's And side. is there be flattish Urban plus most their but is then a for remind last everyone

for this very QX end could retail those that with in total past So if mid- high combine to we similar in URBN the believe whole subscription single-digit where were all We of forecast segment, quarter. the to range, revenues increase we our segment,

Operator

next One moment our for question.

question Telsey Telsey of comes Advisory Our from Dana next the from Group. line

Dana Telsey

With Urban in out progressing how And the each in as in we gave pillars the Celandine, Anthro through I just the collection year? Outfitters any obviously, now? we through is 'XX? on see shift And terms moving be came And five we what should there expecting are Shea, out, division, it you changing. of the profile go one of product business, the strategy. you improvement the customer just the Where think the that there transformation innovation on is then new

Shea Jensen

question. the for thanks Dana,

I be that was on Pillar progress. acutely evolving think doing And we're done X, we're good really a wanted on. we ever all our I nice let product great to that don't feel excited we'll customer we've think focused decisions. the assortment is job We to the the really team proud as making with I that year made guide mind, continuing remain of but progress. entering in this that remember, our We're customer. think to pace you new our be about might

our that and had of You've the few sales notably as important came our increases in denim, were regular accessories at channels. and in in our and in time holidays and I first had nice really good. a a categories, heard priced both categories, 'comp' 'comp' those that think And categories came we We to that lounge several we feels customers. in that in were years. in gifting really of relevant

to and you've to out. more check As of out year, the building we new particularly that. From the hard showcasing we're into much team more evolved think the welcoming where in wild. fortifying quarter broad really And brand. think sort marketing we has there we proud into much on our new is we more it had work, more audience it welcoming about creative holistically, love a about at as the We're of be team chance our and acquiring a about perspective very Hopefully, eyes very we customers, a creative, excited upbeat as and evolved [indiscernible] have it. our and turned seeing

show with of forms terms And not And platform. more and that's Really proud in but ways just platforms. have engaging, of of efforts may different really by been new the a way new operating mediums the on of posting discipline. number those the really seen on in on up in depending platforms. working has team you show unique socially, up And us to

and cleaned next margins, heard you've inventories into delivered [indiscernible] year. that profit enter will continue up as have improvement we solid this that and really we and our As

really The last something and turning pillar this that's as enter we're to we was evolving that year. the channel experience,

So some overall, as is of proud and time, I on process, it to proud progress. selling. regular but couldn't pace be of the think team's This think particularly we about going turning really and is the more I the a take we're tide price

Richard Hayne

Okay. about you talk want Tricia, do Celandine? to

Tricia Smith

Dana, thanks thrilled for be the We results. question the Celandine. about more couldn't about

XXX brand As you launched we know, in exceeding stores, and it's expectations our January the at by quite bit. a

with accessories, resort Our and Celandine we've beauty have cover-ups, handful tested in customer, a success of and strong, have performing they're a small swimwear edit goal to of our a for stores wear was view there. all a seen broad-based differentiated that swim of well. and very products good kind Also for excited very shoes, across spans categories, and

enjoying So so and broad in that of performing able for really be to to really all well. that wear positively assortment positive been needs to that of stores what additive base we'll go ability shop slowly customer and we've launched resort Celandine. terms it's responding is far, across nicely looks the The those and XXX like. kind But it's this of

expand far. how stores the so of that we're into. we'll with the Overall, happy many So can results see

Operator

for our moment One next question.

from comes Baird. Mark question of Altschwager from next Our line the

Mark Altschwager

brand planning you're The first a a wanted years. in here. I I just to store year. few for estate really ask the first the Congrats plans ramp real has time the seen guess, on looks strong growth about like while. on Anthropologie, the for nice momentum just it to

store then look North can the model So that now there, what Outfitters Anthro? I America, reduction unit why as we guiding year. growth is, a you're just ramping the economics similar of we share Urban of on guess at last question to detail in And And you to out. saw sort conversely, terms any to

update the footprint brand on profitability? year should this us will where and out the affect how overall of the size level shake that rationalization thoughts on Just that

Richard Hayne

off? want I'll you order. people, Mark, start but to in Tricia, two do same call opposite the

Tricia Smith

which profit really focusing performance And have the Sure. growth Mark, we on store last full-price deliver our a for with allowed to operating few store been that really our nice us business, prioritizing in started years. model.

well with the we've teams we're we the as done we our edit, Anthropologie. as the ago, XX really that that stores that fantastic XXX believe And announced size support. in stores We have with assortment job at product looking year can line fiscal get we globally and nicely some store 'comps' now had a 'XX, top the way We'll at for different put our As stores. we the that be on stores year said up XXX there. a

nice would kind now I So why the in be of think seen we've brand. growth

model Our nice have operating teams good it. formula we're profitability got done about that a expand getting really believe feel and nice and store we and some to we've intend and a we that job we in And excited profit. like can accelerate

Richard Hayne

to Urban? want you Shea, about Thank Okay. talk you. do

Kelly Crago

Yes.

some you you locations had may real right over is us, that And young we population position as now close estate time, really making about sure folks. strategy -- may our have recall of customers. to seen shifts our For that really

adjacent customers size to - should be and/or store X,XXX of Average are we roughly not think ourselves we is so today either we overspaced. are in XX,XXX, where range. And we find more stores we the closing X,XXX and

And so location. rightsize wrong we're stores closing location where need to or either we is the the

see stores that this you'll the roughly to So year. equates

equate to of our should improvement that the productivity think course couple next well of we years. an the over ultimately, in So as

Richard Hayne

because to full get Okay. I estate. of a Movement to real on FP Sheila want Mark, everybody going I'm picture the And talk about call

Sheila Harrington

Okay.

opened X first So yes, we FP Movement, years just store our ago.

what are We doing are in the Really consumers. -- terms ended this excited brands to past different the about year, XX just stores of stores. stand-alone over introducing

And stores about has future. keep foreseeable pace as XXX-plus XX brand think the they to it another in stores as stores as the open think for we're We we are [indiscernible] the at as will North to We this next continue year, in that going profitable America. long least.

Richard Hayne

I you just can store economics rapidly, open the want to emphasize Congratulations. are. this fact how good them And the that

Okay, next question?

Operator

question. next our for moment One

Ike the Fargo. Our next of line from question Boruchow comes from Wells

Irwin Boruchow

is questions at the some there past of you reported or from walk me. the have reported outlook holiday the Number People what's must Two a of the can guys volatility It Anthro, results. Congrats on the in you of have sound But based Free because been specifically transpired been slowdown. and so? given. to anything 'comps' month guys wrong like There's us lot 'comps', kind space. the doesn't on all maybe one, through over you just January

is actually So And on hear you Nuuly your to guide just could, subs plan? perspective. into your I guide I baking could if active year, us there of would the number love the any you're then on the that chance

Richard Hayne

I'll at Okay. one. shot a the first take

on lot a is they 'comp' it's you are demand brands, us demand, of as markets stores a think of warmer call spring counterparts across and outperforming that being I delayed of delayed We nicely, This because nicely, of three lot is lot see are weather and their a not weather. confidence our assortments the, it, and mean that and are I all received. northern a basis. correct gives well softening

all almost due that is that of to weather. think I So

I bit of on lag, the of people the last a X a X Now and holiday think, bit time we've there a is little spending breather, or and some, seen wanting this, probably to years. more for money

much So more be factor, to it's think that talk a weather. Dave, do want I Nuuly? but may about you about

David Hayne

about actually opportunity. Nuuly we've in XX% our the past the have over a about We first for And sales, in February. year, where far We've Ike. million so excited been in $XXX over quarter, question, we momentum through of first sure. growth. seen the Look, as commentary, are continue lot that headed. profitable trend mentioned the come and the that is into well very seen year Thanks business Yes, with see we've excited we, very this

the bullish well. looking on as So very we're some growth we're exciting year this and for year

We for. that's have and an it recognize have internal be year, internal And we the think I what lined achievable this billion has we you. $X.X But get what goal it's for. minute goal, mentioned which team an up to shooting goal. to no That's that will this business longer an I the internal, we're

X or having proud off years business of excited the ground. this of very we're X that Something in and getting done

So for we're that's think headed. and we that's where what shooting we're

Operator

moment for question. next One our

Morgan line the Straton from comes Stanley. question of Alex next Our from

Alexandra Straton

Just to margin not expansion range. through Maybe the to XX gross a toggles then Anthro level. points Free think, People were XXX mentioned operating Frank, sure mid-teens at, a for can just couple me that who And get you of of kind that for and walk I'm healthy that me. margin you I basis

about And I'm a just between how you banners of those So two really is wondering difference the then do profitability opportunity two? think there at going forward? the kind

Francis Conforti

be there. higher Despite they're prior rate the previous Outfitters, have from year way long and lot improvements a a a give Urban profit up said, more and to points nice than we gross they Happy Alex. lower largely year. to your higher deliver XX still historical against the like averages. over feel two leveraging by XXX as margin, the we basis markdowns the improvement On to could we fiscal full question. driven quarter Sure, for could take to That and first a quarters, at go

just UO. it's Additionally, not

As occupancy perform -- to subscription which stores occupancy. opportunity. benefit's although expense rental leverage gross There the profit remain [indiscernible] our margin they having opportunity as well. and store I Also said, continue doesn't biggest subsegment, for occupancy and have The adds mix relate is of opportunity.

be opportunities inventory opportunity rates continuing We provides about placement, expense delivery also our leveraging around for also which have better leverage. in delivery existing and expense, just to

notable don't Free you, operating and Anthropologie a that mid-teens to I with think be there's difference, honest People profit. between

some would there's you growth an brands with URBN's tell overall of to from not I baked still into more really opportunity those that's rate. profit honest be But and think that opportunity. you, both margin

the I exciting those growth both opportunity. line what's top brands is about think of

share Free Free you're of acquire of just as expanding - customers Daily really to customer heard you've just to the expand category the the but as and at the a they well right? Practice, continue within est their of and rate heard that share about healthy Sheila talking in additional about talking -- The some growth. customers, other wallet, from from and expansions. wallet able Tricia So not And We the Celandine You've see

growth but top and although still bottom I opportunity, there, not So Urban. will be as going some as it there's and about line be is to think line more the their margin addition nearly their our much growth to

Operator

question. our next for One moment

comes question from the next from Marni Our Tracker. of Shapiro line The Retail

Marni Shapiro

to a today right us I'm price. Shea. had operating interested head. And about Urban's more Can And XX% They're -- when in you Congratulations. shopper your us had curious concerned curious, also products. I'm follow-up margin. When on less mentioned that, really good, some all you you from fashion. walk Urban the -- is to a good Frank, can Shea's is that's you've walk and there. if good as

you've sensitive the the insight customer? reversion lately, boring so but -- any market's you side, And been be as and improved would products, God, now, mean, that that price to was are as seeing insight more the on a men's great. that typical going So I Urban of back behavior right has customer seen any

Francis Conforti

for all minute Shea have No, I'm question. Urban. yes, start there. Marni, off about let getting the thanks is I'll And a that kidding. and XX% just

we're that as targeting still believe honestly, can gross that basis reaching improvement rate. much year. XXX this improvement, which profit almost today, can 'XX, of gets X.X% achieve confident basis And just to we us points it. are XX% XX a here delivered we've points in very we XXX fiscal We of operating closer. We margin noted achieve we profit another And

could rate high-teens running not brand to growth to operating long considering UO and nicely that biggest to has. turning the can profit planning As and the which FP faster than total our Anthro do is of contribute profit especially the that that certainly believes another take record you at a in when But profit runway opportunity. and so Anthropologie and only for hold year to come. margin growth opportunity. years expansion, I team the that, more brand fiscal is 'XX, know said, to delivered deliver to URBN continue UO Movement, great rate operating there. and to is stability a our at It's starting see the mid- growing is

congratulations given their year's and their going delivered to they're now, reaching we're goal. Dave the that. performance just confident Nuuly this year as guess, opportunities first $XXX continued -- from rate big to year to and of top dollars delivering and with is team And just public a operating I profit. million for mentioned, Dave this A continue growth growth, that that from past continued build leverage profit growth. line But on

most and have And lastly, continued sales channels opportunities profitable acquisition. in category industry decade to our of one and for People. now through It's the Free been continues consistent all in growth customer expansion brands over and a honestly

So XX% different rate gives us I of hearing and what is that us have we a you're ton have opportunity about talk definitely think run you we leadership all targeted, of a is real we profit operating from tell can a hit drivers team. across that this that lot a as URBN something I to and a

Shea Jensen

Okay. I'll question. your take

were we point. what from been we at missing is the better And Price heard accessible First them that to deal value addressing. range have probably a dynamic on at good, that And customers, and that's hard that's our with. price that is to we of thing what best. just the remind we we talk across more everything And price price. to can. really, work we you most a ambition is price When that best

to And XX% best have that selling price have also are price really we point things we at us of more And our expanded turn roughly that well point. -- our opening know be customers but do for price so our to across we sort do assortments today. that today. and that offer of inspiring

I want offer we be do to customers in that that clear, think, was we've work range, to lately from heard more really but price opening So to done need meet the we the just point.

differentiate There to in market the the of men's terms assortment. As actually work today. that's of far as areas is one in think the do men's, I that we can

excited I yet. think not about point, have that getting really that we're really to conquered

an I excited get to we something and it's think positioned that there. to, uniquely really I but are we're it's really, think in turn definitely looking to that area to differentiate

Richard Hayne

high-low, we emphasize, I when that of them. Marni, awful And low, they been Yes. guess, The one issue. kinds matter that much they a has price what to the for except lot It is call get customer doesn't want things an And historian cost, those I not we just to price to it. how that always on carry a point way Urban is mean here. want products, is the they find an

that's so about, think to And that kind talking Urban I and Shea's of that that's has the what assortment carry.

Operator

question. next One moment for our

from Janet the of comes question next Research from line Our Kloppenburg JJK Associates.

Janet Kloppenburg

to of anyway. year. I'm have of ask a But million couple [indiscernible]. . great questions, . Congratulations a those on and going quarter questions. only wonderful A two a I but questions

Unknown Executive

[indiscernible]

Janet Kloppenburg

you off Go the And and I . but for down, been? Are saying Frank and the UO that Dick, . back up be in ahead, will that come -- saying, North less America to will than year. has yes. be the be say anyway. you first .when that Europe on 'comps' flattish you first Go I kind of quarter want expect at and Okay. quarter. Is it Frank down to ahead. given what might you're

Richard Hayne

I or And the low we we be can't high for going might the where exactly business how why how be get. -- much we other and very can't up tell America that. that 'comps'. say what That's single just exactly said mean, mid-single-digit difficult us. is tell is European unlike down. Let's to to the it's answer And It's North will to difficult ones that's up mid low improvement

So that's mean. we

the -- at had don't don't we do are do it, like cusp. bets, the I think I'm table, and place it. right And down from they're boy, to if I icy would -- all looks on I getting looking

Janet Kloppenburg

not "let's jinx not it" like, ahead jinx it, They're Go let's

Richard Hayne

what i it. think know jinx won't you But I mean. I Okay,

Janet Kloppenburg

Yes.

I hearing. just time. look it's a better I'm long You're have Frank, to rebounding tell then stores to flat it's to making Because lot when a really not go profitability, I until so significantly see been progress better. guys the let's the gets U.S. it low-single-digits, going to is outlook mean friend, for Shea, And I you. profitability to my the you And up but talked People than for the ICR, think for 'XX. 'XX storytelling say for too, back does the what the website, these know call Free in business I that U.S. that about this business. at you, we about and year? What be

Francis Conforti

there. about Urban were for Yes. just I And everyone, I think think you talking

Janet Kloppenburg

Yes, yes.

Francis Conforti

talked about felt 'comp' single-digit like at for as flat And ICR, year, to we low could positive. urban we be the

margin the product Shea talked we -- and better pillars and talked of about control just about like sort and improvement, and Urban's product and stages as the two As about was of honestly, stages. sort better talked better of recovering due it to One, inventory assortment. we

You year, enough. to to in the recapture. return like see to margin and order that last be brand quarters to the things starting see first occupancy. two starting now that's The not quarter to going But this over you're into has of that leverage hold take 'comps' on to off positive

get slightly the As obviously, to stores into But to into drive there. our have over to productive that top more having need time. Shea transform line improvement we improvement smaller being mentioned, will we ability fleet know

which will reach will be just meaningful the margin not year improvement see the the results, we this this but hit think as that's but horizon take and that positive, on I to brand not sales we opportunity it's opportunity also that to rely started starting to the drive the So breakeven year, has the top you're believe which to 'comp' to going a longer-term this brand do we going well. the recapture, line in believe to has year,

Operator

Markets. from The question Simeon Capital from will come last Siegel you. BMO Thank

Simeon Siegel

Nice end year. of the

year, Just revenues to follow actually. up did on your three. drive It's that the smallest two the this interesting last Urban big just of

is large XX% just the mid- a Frank, hear. margin to is the you the revenues thinking see term? be great the expansion Outfitters to to hear, So to taking to the And the step maybe brand's confidence the over should great how and could long how teens about division in great then back, are Urban for high mid

in the level company where long-term curious the also that see opportunity going? you margin Just

Richard Hayne

Simeon. Okay,

it how up there, I'll First it's take? we to the bigger customers there will $X brand. idea. the Can brand going get that that And is that. gives long Urban no is about the billion to People? just way let Urban that So be you brand, billion decide an $X Free be can't than

Francis Conforti

stores, that that time can We're any that is we this it has the going think footprint consumer different right moved. transitioning to But don't we was. and ever younger North think stores we're smaller I good now And some of stores we're transitioning some in of than a example quantity in that is right? where have of to through America

So transition you'll be there a will period that where on. here of going some see

$X we've it's U.K., to largely there have additionally, very is seen underpenetrated really and Dick but to that as some business and Europe, the results And opportunity. about investments penetrated well in still European market. probably some here billion the significant Europe to billion there then nice growth And laid continue support in have to North $X talked in continues from America. a a store perspective

brand for of to -- have a growth So about meaningful the ahead from that really bottom that a then opportunity from opportunities and top perspective. line of size it growth has think continents. across Still you

Richard Hayne

quite so and And so opportunity doing Free are Europe. People. in stores -- does gets And Enormous European nobody their they're well, profitable. misunderstand

So People. bullish we're both Urban we're on Europe, on bullish and Free and

Francis Conforti

what you're think And I I And hinting there's than question. is at we get XX%. opportunity. the appreciate I could Simeon, better think And that always

get would to think you I meaningful. right for set if could opportunity us, know, now, be goal but as with we margin right, as XX% that it an being challenged they Urban flat,

You've not up, is exactly to get add I what ceiling that Anthropology you to time at we Nuuly, or we've give think the know the what absolutely at you're things But about hinting yes, number going -- already People absolutely for felt but number. what I north horizon is true. is. those a of I'm it's When XX%. that don't like least got mid-teens. we could think talked it operating in Free and

think that it's certainly present something I about. opportunity we're itself, excited and does certainly

Richard Hayne

tremendously for I around the I table giving quarter. thank very call. participating. delivering certainly all folks sitting And our much for that and a good fourth all thank the you And concludes

you. So thank

Operator

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

disconnect. now may You

Urban Outfitters (URBN) 26 Feb 252025 Q4 Earnings call transcript