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Abercrombie turns in record fiscal 2025 sales, but margins face pressure
In the latest quarter, net sales rose 1.5% year over year to $1.1 billion, but operating margin narrowed to 8% from 9.3% a year earlier.
Abercrombie & Fitch posted record fiscal 2025 sales, helped by Hollister, but a new earnings phase is raising questions about how durable the turnaround will be, MarketBeat Ratings said. For the company’s most recent quarter, net sales increased 1.5% year over year to $1.1 billion, marking the 14th consecutive quarter of growth and a record for the period. Diluted earnings per share came in at $1.47, ahead of analysts’ expectations, but comparable sales fell 1% and operating margin narrowed to 8% from 9.3%. The outlet attributed part of the margin pressure to higher marketing spend and costs associated with a new enterprise resource planning system rollout. It also flagged a mixed regional picture, with sales up 3% in the Americas and up 24% in Asia-Pacific, while EMEA sales fell 10%.
Abercrombie’s EMEA weakness was linked to regional conflict in the Middle East, which weighed on demand for Hollister in the Middle East and Europe. Looking at the full fiscal year 2025, the company reported annual net sales above $5 billion for the first time, with revenue of $5.3 billion, up 6%, and comparable sales rising 3%.