Abercrombie & Fitch has boosted its fourth-quarter outlook, driven by record demand for women’s apparel.
The retailer of apparel and accessories for men, women and children now expects net sales for the current quarter to be up 1% to 2% after previously providing guidance that the figure would be down 2% to 4%, the firm said in a Monday (Jan. 9) press release.
“At Abercrombie, the strong momentum we have seen all year at the Abercrombie & Fitch brand continued in the holiday season with the women’s business on track to deliver its highest fourth quarter sales ever,” Abercrombie & Fitch CEO Fran Horowitz said in the release. “Importantly, this strong performance has been complemented by an acceleration in men’s growth from third quarter trends.”
For its Hollister brand, the firm expects to finish the fourth quarter with sales below where they were during the same quarter last year. Still, it has seen promising trends resulting from changes in both personnel and product assortment, Horowitz said in the release.
Abercrombie & Fitch had reported in August that inflation and other economic pressures are affecting brands in different ways, with the Abercrombie brand delivering its best performance in years while Hollister — which is aimed at teens — was seeing a drop due to the impact of inflation and a shift away from its core categories and toward a more fashion-driven product.
Competitor Gap reported in November that it, too, was seeing a turnaround in sales and profits even as global commerce faces continued challenges amid high inflation rates.
The manager of clothing brands like Banana Republic, Gap and Old Navy said during its most recent earnings call that its markdowns and discounts had improved its inventory position and made positive strides in online sales.
Looking ahead, Abercrombie & Fitch will continue to adjust in response to an “evolving macroeconomic environment,” Horowitz said.
“We are managing operating expenses tightly, and we continue to target an inventory level consistent with 2021 by year end, positioning our brand to chase receipts in the spring season,” Horowitz said. “At the same time, we are leveraging the company’s strong financial position to drive key, long-term investments in our operations, specifically in technology, stores and supply chain.”
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