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Inflation may not be so bad for some clothing retailers, like Dick’s Sporting Goods and Abercrombie & Fitch. Both companies said they’re getting a sales boost from consumers.
Dick’s Sporting Goods reported a 5.3% sales increase during its first quarter, primarily due to consumers buying clothing and apparel more frequently. During those trips, shoppers opted to purchase items that were more expensive too, the company added.
“The consumer is absolutely putting a priority on healthy and active lifestyle,” said Lauren R.. Hobart, Dick’s Sporting Goods chief executive, during the company’s earnings call. “You see people running and walking being outdoors, but I think the most important thing is that we are providing them with an experience that they’re clearly choosing.”
Hobart told analysts during the call that the company saw growth across its categories, including footwear and apparel, prompting it to raise its full year outlook.
The sporting goods giant now expects sales growth for the year to be in the range of 2% to 3%, and earnings per share to be in the range of $13.35 to $13.75.
Elsewhere in the land of retail, Abercrombie & Fitch is also getting some help from consumers, who are buying more of its clothing and apparel.
Shares of Abercrombie & Fitch jumped by 17% during early hours on Wednesday after the company reported its best first quarter in history.
The New York-based retailer said sales during the period grew 22% year-over-year, primarily due to less discounts and sales for its women and men’s divisions. It reported net sales of $1 billion and operating income of $130 million, which were both “the best first quarter results in the history of the company.”
“We are definitely seeing new consumers coming into the brand,” said Fran Horowitz, Abercrombie’s CEO, during the company’s earnings call. Horowitz added that the company has seen an influx of new customers, thanks to its NFL and Wedding Shop initiatives.
Abercrombie is increasing its full year net sales growth and operating margin outlook. It expects sales to be up around 10%, an increase from its previous outlook of 4% to 6%, which will be lead by its Abercrombie brands and its American base. Abercrombie expects its operating margin to be around 14%, a slight increase from the prior forecast of 12%.