The clothing brand has found renewed appeal among teenage shoppers
Abercrombie announced quarterly net sales of $1.10 billion for the quarter, beating analysts’ estimate of $1.07 billion, as per data compiled by LSEG. Its quarterly adjusted profit was $1.59 per share, also beating analysts’ estimate of $1.39.
The rosy outlook was partially due to the success of its subsidiary brand, Hollister, which saw its sales jump 23% compared to the same period a year prior.
Hollister has found renewed appeal among teenage customers in search of a retro look. A decade ago, apparel from Hollister and brands like Ugg (DECK) were sought-after products among millennial and elder Gen Z teens. Now, their popularity is surging with Gen Alpha and young Gen Zers, according to investment bank Piper Sandler’s (PIPR) semi-annual Taking Stock With Teens survey, published on April 9.
Hollister is the top apparel brand for female teens, disrupting Nike $NKE’s (NKE) dominance, according to the survey of 6,455 teens with an average age of 16.2 years. Today’s teenagers are attracted to Hollister’s vests, low-rise jeans and distressed sweaters for their vintage appeal. It’s a far-cry from the “dead” stores the brand had transformed into aquariums or other businesses just a few years ago, according to Business Insider.
However, Abercrombie isn’t immune from the fallout of President Donald Trump’s tariffs on U.S. imports. It joined retailers such as Ralph Lauren $RL (RL) in cutting its annual profit forecast, anticipating disrupted demand. The company now expects annual net income per share in the range of $9.50 to $10.50, down from its prior forecast of $10.40 to $11.40 per share.
This forecast accounts for existing tariffs, Abercrombie said, which includes a 30% levy on imports from China and a 10% tariff on all other global imports.
The company assumes tariff expenses will cost about $50 million this year, even after factoring mitigation efforts. That’s because imports to the U.S. from China accounted for 5% of total merchandise in the 2024 fiscal year, according to company filings.
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