American Eagle to Expand Activewear Line After Early Success

Activewear was a standout performer during a quarter in which American Eagle Outfitters earned its second-highest revenue.

The clothing, accessories and personal care products retailer reported the “rapid success” of its lingerie brand Aerie’s extension into activewear and that its core brand American Eagle launched a sub-brand focused on men’s activewear in January, according to a Wednesday (March 1) press release.

“Our activewear extension — Offline by Aerie — remained a standout performer, led by our leggings franchise,” Jen Foyle, president and executive creative director at American Eagle and Aerie, said Wednesday during the company’s quarterly earnings call. “Leggings continue to be a powerful driver of new customer acquisitions, and we are seeing nice momentum across fashion and performance styles.”

Noting that the activewear category is growing fast, Foyle added during the call that American Eagle’s launch of its AE 24/7 sub-brand has been well received.

“Early reception to our limited initial assortment has been very encouraging, and we look forward to scaling the collection later this year,” Foyle said.

The activewear category took off during the pandemic as families started spending more time than ever at home, Target said in 2021 when reporting that its “All in Motion” line became one of 10 Target brands that hit $1 billion in sales.

That same year, Levi Strauss & Co. expanded into activewear by purchasing Beyond Yoga as consumers continued to seek comfortable apparel.

In April 2022, Walmart launched an activewear and swim brand called Love & Sports and said this was part of its efforts to deliver on-trend apparel and accessories.

American Eagle’s advances in activewear came as the retailer achieved fourth-quarter revenue that was second only to the record results in 2021, according to the press release.

American Eagle Executive Chairman and CEO Jay Schottenstein attributed the growth to the company’s efforts to refresh the American Eagle brand, capitalize on trends and reach out to new customers with brand extensions like those in the activewear category.

Looking ahead, American Eagle expects revenue to be in the range of flat to up low single digits during the first quarter and the full year 2023, according to the press release.

Schottenstein said in the release that the company’s inventory levels are healthy, the global supply chain has stabilized and costs are more normalized.

“Yet, our visibility into the macro remains limited and we are taking a cautious view on 2023,” Schottenstein said. “We will stay disciplined, maintain sharp control over expenses and seek ongoing efficiencies to drive shareholder returns.”

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