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- Record first quarter net sales of
$1.1 billion , up 2% from last year, 14th consecutive quarter of growth - Net sales growth led by
Americas up 3%, APAC up 24%, partially offset by 10% decline in EMEA - Brand performance led by Abercrombie brands growth of 3%, with Hollister brands flat
- Operating margin of 8.0%, with earnings per diluted share of
$1.47 exceeding outlook range $105 million in shares repurchased in the quarter; 3% of shares outstanding at beginning of the year- Maintains full-year outlook to net sales growth of 3% to 5%, net income per diluted share of
$10.20 to$11.00 , share repurchases of around$450 million - Second quarter outlook of net sales growth of 2% to 4%, net income per diluted share of
$1.80 to$2.00 , at least$150 million in share repurchases
On our first-quarter progress, we are maintaining our full-year sales and operating margin outlook. With our customer at the center of everything we do and a strong foundation in place, we remain on offense across product and marketing and are confident in our path to deliver full-year net sales growth across brands, double-digit operating margins, strong cash flow and earnings per share growth to create long-term value for shareholders.”
Details related to reported net income per diluted share and adjusted net income per diluted share for the first quarter are as follows:
| 2026 | 2025 | |||||
| GAAP | $ | 1.47 | $ | 1.59 | ||
| Impact from changes in foreign currency exchange rates(1) | — | 0.11 | ||||
| Adjusted non-GAAP constant currency | $ | 1.47 | $ | 1.70 |
(1) The estimated impact from foreign currency is calculated by applying current period exchange rates to prior year results using a 26% tax rate.
A summary of results for the first quarter ended
- Net sales of
$1.1 billion , up 2% as compared to last year, with comparable sales of (1)%. - Operating income of
$89 million as compared to operating income last year of$102 million . - Operating margin as a percent of sales of 8.0% as compared to 9.3% last year.
- Net income per diluted share of
$1.47 as compared to net income per diluted share last year of$1.59 .
Net sales by segment and brand for the first quarter are as follows:
| (in thousands) | 2026 | 2025 | 1 YR % Change | Comparable sales(2) | |||||||
| Net sales by segment:(1) | |||||||||||
| $ | 899,944 | $ | 874,804 | 3 | % | 1 | % | ||||
| EMEA(4) | 167,373 | 185,036 | (10 | )% | (11 | )% | |||||
| APAC(5) | 46,504 | 37,471 | 24 | % | 15 | % | |||||
| Total company | $ | 1,113,821 | $ | 1,097,311 | 2 | % | (1 | )% | |||
| 2026 | 2025 | 1 YR % Change | Comparable sales(2) | ||||||||
| Net sales by brand family: | |||||||||||
| Abercrombie | $ | 564,719 | $ | 547,947 | 3 | % | — | % | |||
| Hollister | 549,102 | 549,364 | — | % | (2 | )% | |||||
| Total company | $ | 1,113,821 | $ | 1,097,311 | 2 | % | (1 | )% | |||
(1) Net sales by segment are presented by attributing revenues to a physical store location or geographical region that fulfills the order.
(2) Comparable sales are calculated on a constant currency basis. Refer to "REPORTING AND USE OF GAAP AND NON-GAAP MEASURES," for further discussion.
(3) The
(4) The EMEA segment includes the results of operations in
(5) The APAC segment includes the results of operations in the
| Financial Position and Liquidity |
As of
- Cash and equivalents of
$594 million compared to$760 million and$511 million as ofJanuary 31, 2026 andMay 3, 2025 , respectively. - Marketable securities of
$25 million compared to$25 million and$97 million as ofJanuary 31, 2026 andMay 3, 2025 , respectively. - Inventories of
$533 million compared to$601 million and$542 million as ofJanuary 31, 2026 andMay 3, 2025 , respectively. - Borrowing capacity of
$500 million under the senior-secured asset-based revolving credit facility (the “ABL Facility”) with net borrowing available of$450 million after minimum excess availability requirement. - Liquidity comprised of cash and equivalents and borrowing available under the ABL Facility, of approximately
$1.0 billion as ofMay 2, 2026 . This compares to liquidity of$1.2 billion and$0.9 billion as ofJanuary 31, 2026 andMay 3, 2025 , respectively.
| Cash Flow and Capital Allocation |
Details related to the company’s cash flows for the year-to-date period ended
- Net cash provided by operating activities of
$44 million . - Net cash used for investing activities of
$61 million , primarily reflecting capital expenditures. - Net cash used for financing activities of
$148 million , primarily reflecting share repurchases.
During the first quarter of 2026, the company repurchased 1.2 million shares for approximately
Depreciation and amortization was
| Fiscal 2026 Outlook |
| The following outlook replaces all previous full year guidance. For fiscal 2026, the company now expects: | ||
| Current Full Year Outlook | Previous Full Year Outlook (1) | |
| Net sales | Growth In |
Growth In |
| Year-over-year tariff impact (bps) (2) | Unfavorability of around 20 bps | Unfavorability of around 70 bps |
| Operating margin | In |
In |
| Effective tax rate (3) | Around 30% | Around 29% |
| Net income per diluted share (4) (5) | In |
In |
| Share repurchases (5) | Around |
Around |
| Diluted weighted average shares (4) (5) | Around 44 million | Around 45 million |
| Capital expenditures | Around |
In |
| Real estate activity (6) |
~30 Net Store Openings | ~30 Net Store Openings |
| (all approximate) |
50 Openings, 20 Closures | 55 Openings, 25 Closures |
| 80 Remodels and Right-Sizes | 70 Remodels and Right-Sizes | |
| Second Quarter Outlook | ||
| Net sales | Growth In |
|
| Year-over-year tariff impact (bps) (2) | Unfavorability of around 120 bps | |
| Operating margin | Around 10% | |
| Effective tax rate (3) | Around 32% | |
| Net income per diluted share (4) (5) | In |
|
| Share repurchases (5) | At least |
|
| Diluted weighted average shares (4) (5) | Around 45 million | |
(1) Released
(2) Reflects the estimated impact of a 10% tariff rate on all goods imported into
(3) The current outlook for effective tax rate is sensitive to the jurisdictional mix and level of income and does not include the impact of potential future tax policy or legislative changes.
(4) The current outlook for net income per diluted share and diluted weighted average shares includes the anticipated impact to shares outstanding from potential share repurchase activity in fiscal 2026.
(5) The timing and amount of any such repurchases will be determined based on an evaluation of market conditions, the company’s share price, legal requirements, and other factors.
(6) Owned-and-operated stores only.
| Conference Call |
Today at
https://register-conf.media-server.com/register/BI29d238aae2774ad3be89eb389ae01fad
A presentation of first quarter results will be available in the “Investors” section at corporate.abercrombie.com at approximately
| Safe Harbor Statement Under the Private Securities Litigation Reform Act of 1995 |
This Press Release and related statements by management or spokespeople of
| Other Information |
This document includes certain adjusted non-GAAP financial measures, which are not calculated in accordance with accounting principles generally accepted in
As used in this document, references to “Americas” includes
| About |
The company operates a family of brands, including Abercrombie brands and Hollister brands, each sharing a commitment to offer products of enduring quality and exceptional comfort that support global customers on their journey to being and becoming who they are.
| Investor Contact: | Media Contact: |
| (614) 283-6751 | (614) 283-6192 |
| Investor_Relations@anfcorp.com | Public_Relations@anfcorp.com |
| Condensed Consolidated Statements of Operations | |||||||||||||
| (in thousands, except per share data) | |||||||||||||
| (Unaudited) | |||||||||||||
| Thirteen Weeks Ended | Thirteen Weeks Ended | ||||||||||||
| % of |
% of |
||||||||||||
| Net sales | $ | 1,113,821 | 100.0 | % | $ | 1,097,311 | 100.0 | % | |||||
| Cost of sales, exclusive of depreciation and amortization | 413,838 | 37.2 | % | 417,133 | 38.0 | % | |||||||
| Selling expense | 431,195 | 38.7 | % | 399,937 | 36.4 | % | |||||||
| General and administrative expense | 182,754 | 16.4 | % | 174,925 | 15.9 | % | |||||||
| Other operating (income) loss, net | (2,763 | ) | (0.2)% | 3,783 | 0.3 | % | |||||||
| Operating income | 88,797 | 8.0 | % | 101,533 | 9.3 | % | |||||||
| Interest expense | 450 | — | % | 661 | 0.1 | % | |||||||
| Interest income | (5,737 | ) | (0.5)% | (7,444 | ) | (0.7)% | |||||||
| Interest income, net | (5,287 | ) | (0.5)% | (6,783 | ) | (0.6)% | |||||||
| Income before income taxes | 94,084 | 8.4 | % | 108,316 | 9.9 | % | |||||||
| Income tax expense | 25,965 | 2.3 | % | 26,577 | 2.4 | % | |||||||
| Net income | 68,119 | 6.1 | % | 81,739 | 7.4 | % | |||||||
| Less: Net income attributable to noncontrolling interests | 985 | 0.1 | % | 1,326 | 0.1 | % | |||||||
| Net income attributable to A&F | $ | 67,134 | 6.0 | % | $ | 80,413 | 7.3 | % | |||||
| Net income per share attributable to A&F | |||||||||||||
| Basic | $ | 1.49 | $ | 1.63 | |||||||||
| Diluted | $ | 1.47 | $ | 1.59 | |||||||||
| Weighted-average shares outstanding: | |||||||||||||
| Basic | 44,969 | 49,214 | |||||||||||
| Diluted | 45,677 | 50,634 | |||||||||||
Reporting and Use of GAAP and Non-GAAP Measures
The company believes that each of the non-GAAP financial measures presented are useful to investors as they provide a measure of the company’s operating performance excluding the effect of certain items which the company believes do not reflect its future operating outlook, therefore supplementing investors’ understanding of comparability of operations across periods. Management used these non-GAAP financial measures during the periods presented to assess the company’s performance and to develop expectations for future operating performance. Non-GAAP financial measures should be used supplementally to, and not as an alternative to, the company’s GAAP financial results, and may not be calculated in the same manner as similar measures presented by other companies.
The company provides comparable sales, defined as the percentage year-over-year change in the aggregate of: (1) sales for stores that have been open as the same brand at least one year and whose square footage has not been expanded or reduced by more than 20% within the past year, with prior year’s net sales converted at the current year’s foreign currency exchange rate to remove the impact of foreign currency rate fluctuation, and (2) digital net sales with prior year’s net sales converted at the current year’s foreign currency exchange rate to remove the impact of foreign currency rate fluctuation.
The company also provides certain financial information on a constant currency basis to enhance investors’ understanding of underlying business trends and operating performance, by removing the impact of foreign currency exchange rate fluctuations. The effect from foreign currency, calculated on a constant currency basis, is determined by applying current year average exchange rates to prior year results and is net of the year-over-year impact from hedging. The per diluted share effect from foreign currency is calculated using a 26% tax rate.
In addition, the company provides EBITDA as a supplemental measure used by the company’s executive management to assess the company’s performance. We also believe this supplemental performance measure is meaningful information for investors and other interested parties to use in computing the company’s core financial performance over multiple periods and with other companies by excluding the impact of differences in tax jurisdictions, debt service levels and capital investment.
| Reconciliation of Constant Currency Financial Measures | |||||||||
| Thirteen Weeks Ended May 2, 2026 and |
|||||||||
| (in thousands, except percentage and basis point changes and per share data) | |||||||||
| (Unaudited) | |||||||||
| 2026 | 2025 | % Change | |||||||
| Net sales | |||||||||
| GAAP(1) | $ | 1,113,821 | $ | 1,097,311 | 2 | % | |||
| Impact from changes in foreign currency exchange rates(2) | — | 11,019 | (1 | ) | |||||
| Net sales on a constant currency basis | $ | 1,113,821 | $ | 1,108,330 | — | % | |||
| Operating income | 2026 | 2025 | BPS Change(3) | ||||||
| GAAP(1) | $ | 88,797 | $ | 101,533 | (130 | ) | |||
| Impact from changes in foreign currency exchange rates(2) | — | 7,486 | (50 | ) | |||||
| Non-GAAP constant currency basis | $ | 88,797 | $ | 109,019 | (180 | ) | |||
| Net income per share attributable to A&F | 2026 | 2025 | $ Change | ||||||
| GAAP(1) | $ | 1.47 | $ | 1.59 | $ | (0.12 | ) | ||
| Impact from changes in foreign currency exchange rates(2) | — | 0.11 | (0.11 | ) | |||||
| Non-GAAP constant currency basis | $ | 1.47 | $ | 1.70 | $ | (0.23 | ) | ||
(1) “GAAP” refers to accounting principles generally accepted in
(2) The estimated impact from foreign currency is determined by applying current period exchange rates to prior year results and is net of the year-over-year impact from hedging. The per diluted share estimated impact from foreign currency is calculated using a 26% tax rate.
(3) The estimated basis point change has been rounded based on the percentage change.
| Reconciliation of EBITDA | ||||||||||||
| Thirteen Weeks Ended May 2, 2026 and |
||||||||||||
| (in thousands) | ||||||||||||
| (Unaudited) | ||||||||||||
| 2026 | % of |
2025 | % of |
|||||||||
| Net income | $ | 68,119 | 6.1 | % | $ | 81,739 | 7.4 | % | ||||
| Income tax expense | 25,965 | 2.3 | 26,577 | 2.4 | ||||||||
| Interest income, net | (5,287 | ) | (0.5 | ) | (6,783 | ) | (0.6 | ) | ||||
| Depreciation and amortization | 42,304 | 3.9 | 38,576 | 3.6 | ||||||||
| EBITDA(1) | $ | 131,101 | 11.8 | % | $ | 140,109 | 12.8 | % | ||||
(1) EBITDA is a supplemental financial measure that is not defined or prepared in accordance with GAAP. EBITDA is defined as net income before interest, income taxes and depreciation and amortization.
| Condensed Consolidated Balance Sheets | ||||||||
| (in thousands) | ||||||||
| (Unaudited) | ||||||||
| Assets | ||||||||
| Current assets: | ||||||||
| Cash and equivalents | $ | 594,080 | $ | 759,540 | $ | 510,563 | ||
| Marketable securities | 25,144 | 25,036 | 97,006 | |||||
| Receivables | 146,042 | 146,757 | 113,311 | |||||
| Inventories | 532,691 | 601,218 | 542,059 | |||||
| Other current assets | 117,202 | 117,913 | 111,231 | |||||
| Total current assets | 1,415,159 | 1,650,464 | 1,374,170 | |||||
| Property and equipment, net | 686,576 | 674,079 | 606,060 | |||||
| Operating lease right-of-use assets | 1,115,832 | 997,399 | 868,130 | |||||
| Other assets | 235,397 | 219,932 | 247,816 | |||||
| Total assets | $ | 3,452,964 | $ | 3,541,874 | $ | 3,096,176 | ||
| Liabilities and stockholders’ equity | ||||||||
| Current liabilities: | ||||||||
| Accounts payable | $ | 257,945 | $ | 377,465 | $ | 296,738 | ||
| Accrued expenses | 425,149 | 465,549 | 433,682 | |||||
| Short-term portion of operating lease liabilities | 262,316 | 241,265 | 215,511 | |||||
| Income taxes payable | 31,708 | 21,721 | 52,939 | |||||
| Total current liabilities | $ | 977,118 | $ | 1,106,000 | $ | 998,870 | ||
| Long-term liabilities: | ||||||||
| Long-term portion of operating lease liabilities | $ | 1,030,161 | $ | 926,830 | $ | 810,391 | ||
| Other liabilities | 91,789 | 88,633 | 84,321 | |||||
| Total long-term liabilities | 1,121,950 | 1,015,463 | 894,712 | |||||
| Total |
1,340,090 | 1,403,895 | 1,189,126 | |||||
| Noncontrolling interests | 13,806 | 16,516 | 13,468 | |||||
| Total stockholders’ equity | 1,353,896 | 1,420,411 | 1,202,594 | |||||
| Total liabilities and stockholders’ equity | $ | 3,452,964 | $ | 3,541,874 | $ | 3,096,176 | ||
| Condensed Consolidated Statements of Cash Flows | |||||||
| (in thousands, except per share data) | |||||||
| (Unaudited) | |||||||
| Thirteen Weeks Ended | |||||||
| Operating activities | |||||||
| Net cash provided by (used for) operating activities | $ | 44,256 | $ | (4,000 | ) | ||
| Investing activities | |||||||
| Purchases of marketable securities | $ | (9,800 | ) | $ | — | ||
| Proceeds from maturities of marketable securities | 9,800 | 20,000 | |||||
| Purchases of property and equipment | (61,341 | ) | (50,764 | ) | |||
| Net cash used for investing activities | $ | (61,341 | ) | $ | (30,764 | ) | |
| Financing activities | |||||||
| Purchases of common stock | (105,018 | ) | $ | (200,000 | ) | ||
| Acquisition of common stock for tax withholding obligations | (38,433 | ) | (34,062 | ) | |||
| Other financing activities | (4,177 | ) | (451 | ) | |||
| Net cash used for financing activities | $ | (147,628 | ) | $ | (234,513 | ) | |
| Effect of foreign currency exchange rates on cash | $ | (787 | ) | $ | 7,407 | ||
| Net decrease in cash and equivalents, and restricted cash and equivalents | $ | (165,500 | ) | $ | (261,870 | ) | |
| Cash and equivalents, and restricted cash and equivalents, beginning of period | $ | 766,916 | $ | 780,395 | |||
| Cash and equivalents, and restricted cash and equivalents, end of period | $ | 601,416 | $ | 518,525 | |||
Source: Abercrombie & Fitch Management Co.