Shares of Abercrombie & Fitch Co. (ANF) were losing around 17 percent after the retailer tightened its earnings and sales growth outlook for fourth quarter. Further, the company tightened its earnings view for fiscal 2025, and trimmed forecast for operating margin and net sales growth.
Fran Horowitz, Chief Executive Officer, said, "Our team remained on offense across product, voice, and experience, resulting in record quarter-to-date net sales through fiscal December, aligned with our expectations. … Hollister Brands had a strong holiday and is positioned to deliver another year of mid-teens net sales growth for fiscal 2025. At Abercrombie Brands, we saw a strong customer response over the holidays, and we now expect to grow net sales in the low single digits for the fourth quarter on top of a record result last year."
For the fourth quarter, the company now expects earnings in a range of $3.50 to $3.60 per share on net sales growth of around 5 percent. The company previously expected earnings in a range of $3.40 to $3.70 per share on net sales growth of 4 to 6 percent.
The Wall Street analysts on average expect the company to report earnings of $3.58 per share on net sales growth of 5.78 percent to $1.68 billion. Analysts' estimates typically exclude special items.
Operating margin is still projected to be around 14 percent.
Looking ahead to fiscal 2025, the company now projects earnings in a range of $10.30 to $10.40 per share on net sales growth of of at least 6 percent. The previous estimate was earnings in a range of $10.20 to $10.50 per share on net sales growth of 6 to 7 percent.
Operating margin is now expected to be around 13 percent, compared to previous estimate in the range of 13 percent to 13.5 percent. The Street is looking for earnings of $10.03 per share on revenue growth of 6.56 percent percent to $5.27 billion for the year.
Horowitz added that the company remains on track for another year of significant progress, consistently delivering on its goals with expected record net sales and growth of at least 6 percent.
In pre-market activity, the shares were trading at $103.94, down 20.97 cents or 16.78 percent.
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