American Eagle Outfitters joined rival Abercrombie & Fitch in raising its annual revenue forecast, betting on steady demand for its wide-legged pants, tops and accessories despite still-high inflation.
The forecasted increase coincides with other businesses, including Macy’s, taking a cautious approach to the second half as U.S. consumer purchasing is stressed by high costs and borrowing rates.
Compared to the same quarter last year, inventories decreased by 7 per cent. In an effort to draw in more customers, the company has also been replenishing its shelves with updated styles in its fleece, activewear, and seasonal tops categories.
When the clothing company unveiled its early autumn collection across its Aerie and American Eagle segments in July, it was reported that demand had increased in August. This trend started late in June and persisted.
“It’s encouraging to see positive momentum continue into the third quarter, across brands and channels,” said CEO Jay Schottenstein.
According to LSEG statistics, the company also anticipates a third-quarter sales increase in the low-single digits vs forecasts for a decline of 0.9 per cent.
Sales for Aerie, a division that produces bralettes, swimwear and activewear, increased 2 per cent quarterly while those for its named division decreased 1 per cent.
In contrast to its previous prediction of a flat to low-single-digit fall, American Eagle now anticipates yearly revenue growth in the low single digits.
