The Business of Fashion
Agenda-setting intelligence, analysis and advice for the global fashion community.
Agenda-setting intelligence, analysis and advice for the global fashion community.
American Eagle Outfitters Inc said on Tuesday its inventory levels jumped ahead of the holiday season as it spent more on air freight to overcome supply chain disruptions, after posting better-than-expected quarterly results.
Shoppers have been splurging on streetwear, visiting stores more after vaccinations and the easing of Covid-19 curbs. But congested ports and factory closures in Asia have resulted in nearly empty shelves for some retailers.
Abercrombie & Fitch Co on Tuesday also posted quarterly revenue above market expectations but said its inventory levels were largely flat from a year earlier.
Shares in Abercrombie fell about 17 percent, tracking their worst day in two-half years, while those of American Eagle rose 5 percent.
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Abercrombie is expected to take a hit of around $75 million in the fourth quarter due to higher freight rates, chief finance officer Scott Lipesky said on a post-earnings call.
American Eagle forecast additional holiday quarter freight costs of $70 million to $80 million. The company, however, has been beefing up its logistics game, after it agreed this month to buy Quiet Logistics for $350 million, following its takeover of AirTerra earlier this year.
Most other US apparel sellers have reported an increase in inventory levels as they chartered their own container ships and ordered products in advance for the holidays.
American Eagle said its inventory at the end of the third quarter increased 32 percent to $740 million. “We are in a healthy inventory position... set up for a very strong holiday,” chief operating officer Michael Rempell told analysts.
For American Eagle, third quarter net revenue increased 24 percent to $1.27 billion, beating estimates of $1.23 billion, according to Refinitiv IBES. Helped by demand for its eponymous and Aerie brands, it also beat profit estimates.
Abercrombie’s net sales, meanwhile, rose 10 percent to $905.2 million.
By Praveen Paramasivam and Reshma Rockie George; Editor: Ramakrishnan M.
The all-cash transaction is part of the retailer’s “ongoing supply chain transformation,” it announced Tuesday, Nov. 2. The deal follows American
Designer brands including Gucci and Anya Hindmarch have been left millions of pounds out of pocket and some customers will not get refunds after the online fashion site collapsed owing more than £210m last month.
Antitrust enforcers said Tapestry’s acquisition of Capri would raise prices on handbags and accessories in the affordable luxury sector, harming consumers.
As a push to maximise sales of its popular Samba model starts to weigh on its desirability, the German sportswear giant is betting on other retro sneaker styles to tap surging demand for the 1980s ‘Terrace’ look. But fashion cycles come and go, cautions Andrea Felsted.
The rental platform saw its stock soar last week after predicting it would hit a key profitability metric this year. A new marketing push and more robust inventory are the key to unlocking elusive growth, CEO Jenn Hyman tells BoF.