American Eagle Outfitters Reports 8% Revenue Growth and Significant Profit Improvements

American Eagle Outfitters, Inc. reported significant financial performance improvements for the 13 and 26 weeks ended August 3, 2024, compared to the same periods in the previous fiscal year. Total net revenue for the 13 weeks reached $1,291,058,000, an 8% increase from $1,200,879,000 in 2023. For the 26 weeks, revenue rose to $2,434,925,000, up from $2,281,805,000, reflecting a 7% growth. The increase in revenue was attributed to a shift in the retail calendar, contributing approximately $70 million, alongside a 12% rise in digital sales and a 6% increase in store revenue.

Gross profit for the 13 weeks was $498,896,000, a 10% increase from $453,016,000, driven by a $57 million increase in merchandise margin. For the 26 weeks, gross profit rose to $963,134,000, up 11% from $866,195,000. Operating income also saw substantial growth, with a 55% increase for the 13 weeks to $101,109,000, and a 103% increase for the 26 weeks to $178,944,000. This growth was supported by a reduction in depreciation and amortization expenses and a positive impact from the retail calendar shift.

Net income for the 13 weeks ended August 3, 2024, was $77,264,000, compared to $48,570,000 in the prior year, marking a 59% increase. For the 26 weeks, net income surged to $145,014,000 from $67,022,000, representing a 116% increase. Basic net income per share for the 13 weeks was $0.40, up from $0.25, while for the 26 weeks, it rose to $0.74 from $0.34.

The company’s total current assets decreased to $1,248,445,000 as of August 3, 2024, from $1,433,350,000 in February 2024, while total assets slightly declined to $3,540,316,000. Total current liabilities decreased to $794,386,000, and total non-current liabilities increased to $1,051,564,000. Retained earnings increased to $2,320,348,000, and total stockholders’ equity was $1,694,366,000.

In terms of operational changes, American Eagle Outfitters streamlined operations of Quiet Platforms in Fiscal 2023, focusing on regionalized fulfillment. The company also launched a profit improvement program named "Powering Profitable Growth," which aims to enhance cost structure and gross margin. Capital expenditures for the 26 weeks totaled $96,945,000, with expectations for Fiscal 2024 projected between $200 million and $250 million to support expansion and upgrades.

The company repurchased 6 million shares during the 26 weeks ended August 3, 2024, under a new share repurchase program authorized in February 2024. The program allows for the repurchase of up to 30 million shares, set to expire in February 2029.