Abercrombie & Fitch (NYSE:ANF) shares rose about 12% after the company reported first-quarter results that beat profit expectations, while revenue slightly missed and comparable sales declined.
For the quarter ended May 2, the company posted adjusted earnings of $1.47 per share, above analyst expectations of $1.28.
Net sales rose 2% year over year to $1.11 billion, narrowly missing consensus estimates of $1.12 billion.
Comparable sales fell 1%, compared with expectations for flat performance.
The company’s 14th consecutive quarter of revenue growth was driven by a 3% increase in the Americas and a 24% jump in APAC, while EMEA declined 10%.
Abercrombie brand sales rose 3%, while Hollister was flat.
Looking ahead, the company maintained its full-year outlook, expecting net sales growth of 3% to 5% and net income per diluted share of $10.20 to $11. It also reiterated plans for approximately $450 million in share repurchases for the year.
For the second quarter, Abercrombie & Fitch forecast net sales growth of 2% to 4% and earnings per share of $1.80 to $2, alongside at least $150 million in buybacks.
“With our customer at the center of everything we do and a strong foundation in place, we remain on offense across product and marketing and are confident in our path to deliver full-year net sales growth across brands, double-digit operating margins, strong cash flow and earnings per share growth to create long-term value for shareholders,” Abercrombie CEO Fran Horowitz said in a statement.
Jefferies analysts wrote that the total company results came in better than feared, with comparable sales performance slightly ahead of expectations and Abercrombie-branded comps notably more resilient than anticipated, coming in flat versus expectations for a decline. The firm believes that this suggests underlying brand strength is holding up better than the Street had modeled, even as overall comps remained negative.
On regional performance, Jefferies highlighted continued strength in the Americas and APAC offset by a sharper downturn in EMEA, which it attributed to a tougher geopolitical and demand backdrop. It flagged EMEA as a key ongoing pressure point for the growth mix.
On margins, Jefferies noted that both operating margin and EPS exceeded the company’s prior outlook, despite softer revenue and concerns around promotions.
The firm said the result points to continued discipline on costs and a favorable brand mix effect supporting profitability.