News

Abercrombie & Fitch enjoys healthy profit, smaller sales dip for quarter

Clothing retailer Abercrombie & Fitch got an early holiday gift with its latest earnings report.

November 23, 2015

Clothing retailer Abercrombie & Fitch got an early holiday gift with its latest earnings report as its expected sales dip wasn’t as deep as projected and profits more than doubled in the most recent quarter.

The Q3 earnings report revealed the teen apparel brand enjoyed its smallest sales dip in the last six quarters and the news was well received by the market with shares jumping 17 percent, according to a Reutersreport.

"If you have the right product, there is a trend going on that is allowing teen retailers to grow same-store sales," Nomura Equities Research analyst Simeon Siegel told Reuters.

One reason for the robust financials could be the fact the retailer brought on brand designers from Ralph Lauren and Tommy Hilfiger, revamped its store locations with new music, a refreshed merchandising strategy and pulled back on logo-focused clothing options.

Market analysts were expecting a 2.4-percent sales drop but the figure was 1 percent and total revenue dipped 3.6 percent, which was less than what analysts were expecting as well.

"As we look ahead in the fourth quarter, there are mixed signals in the sector and we remain cautious," Abercrombie Executive Chairman Arthur Martinez said, according to Reuters.