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American Eagle Online Sales Drop on Easing Covid-19 Curbs, Shares Slump

American Eagle Outfitters. Shutterstock.

American Eagle Outfitters Inc reported quarterly revenue that missed estimates on Thursday as the apparel retailer’s online business slowed following vaccinations and the easing of some Covid-19 curbs, sending its shares tumbling 12 percent before the bell.

The company’s second quarter digital sales fell 5 percent from a year earlier, hurt by customers shopping more at brick-and-mortar stores as well as stiff competition from e-commerce giants including Amazon.com Inc.

Major retailers including Target Corp and Gap Inc have reported a slowdown in digital sales in their latest quarterly reports, although they remain higher compared with pre-pandemic levels.

American Eagle’s consolidated revenue from its physical stores, however, increased 73 percent from a year earlier in the second quarter ended July 31.

The company’s Aerie brand, which sells work-from-home favourites lingerie and lounge wear, posted a 34 percent rise in revenue to $336 million, while American Eagle label sales jumped 35 percent to $846 million.

Total net revenue increased 35 percent to $1.19 billion, mainly as temporary store closures hammered demand for apparel last year. However, the figure came short of Refinitiv-IBES estimates of $1.23 billion.

Excluding items, American Eagle earned 60 cents per share, beating estimates of 55 cents, as it sold more goods at full prices.

By Praveen Paramasivam and Reshma Rockie George; Editor: Ramakrishnan M.

Learn more:

American Eagle Sees Sales Rising on Pent-Up Demand for Apparel

American Eagle Outfitters Inc said sales of its jeans and tops was accelerating, after the apparel retailer reported a first-quarter results beat on increased spending, driven by stimulus checks.

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State of Fashion 2023
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State of Fashion 2023