American Eagle Q3 FY24 Revenue Falls 1%, Profit Declines 3% Year-Over-Year

In a recent announcement, American Eagle Outfitters shared some mixed financial news regarding its performance in the third quarter of fiscal year 2024. The retailer reported revenue of $1.29 billion for Q3 FY24, reflecting a slight decline of 1 percent compared to the previous year. Gross profit also saw a decrease, landing at $527 million, which is down 3 percent year-over-year. This resulted in a net income of $80 million, a noticeable drop from last year’s figures.

For the first nine months of the fiscal year, American Eagle has managed to boost its revenue to $3.7 billion, alongside an increase in net income to $225 million. While the Aerie line demonstrated strong revenue growth, other segments suffered significant declines.

Looking ahead, the company is projecting comparable sales growth of approximately 3 percent for FY24, with an anticipated operating income between $428 million and $433 million. The gross margin for Q3 FY24 was reported at 40.9 percent, a slight decline from the same period last year, which stood at 41.8 percent. Despite these fluctuations, American Eagle is expected to see total revenue growth of about 1 percent for the full fiscal year.

American Eagle’s executive chairman and CEO, Jay Schottenstein, expressed optimism about the results, emphasizing the effectiveness of their strategy to drive profitable growth. He noted that the back-to-school season contributed positively, with a favorable customer response during key sales periods.

As the holiday season approaches, the company feels well-positioned, aiming to capitalize on its strong brand offerings and ensure an excellent shopping experience across various channels. However, there remains an awareness of potential volatility in sales outside peak times, and the management team is focused on executing their plans for the upcoming quarter.

In the fourth quarter, American Eagle anticipates comparable sales growth of around 1 percent, though total revenue may dip by 4 percent. The impact of the retail calendar shift, including one fewer selling week, is cited as a factor in this expected decline.

Overall, while American Eagle Outfitters faces challenges with declining revenue in certain segments, its positive outlook and growth in the Aerie brand indicate the company is navigating this fluctuating landscape with care and strategic foresight.