American Eagle Outfitters : Fourth Quarter 2024 Earnings Releases
AEO
AEO Inc. Reports Strong Fourth Quarter and Fiscal Year 2024 Results; Provides Fiscal Year 2025 Outlook
Fourth quarter comparable sales growth of 3%, operating income of $142 million
● Record Aerie revenue with comp growth of 6%; American Eagle comp growth of 1%
Fiscal year comparable sales growth of 4%; record revenue with signifcant proft expansion ● Record Aerie revenue with comp growth of 5%. American Eagle comp growth of 3% ● GAAP operating income of $427 million. Adjusted operating income up 19% to $445
million
Over $190 million returned to shareholders through shares repurchases in 2024; Board of Directors authorizes additional 50 million shares for repurchase
March 12, 2025
PITTSBURGH -- (BUSINESS WIRE) - American Eagle Outftters, Inc. (NYSE: AEO) today announced fnancial results for the fourth quarter and fscal year 2024 ended February 1, 2025.
"2024 demonstrated signifcant progress on our Powering Proftable Growth Plan. The team delivered strong operating proft growth with positive momentum across our brands and channels as well as disciplined expense management and operating effciencies," commented Jay Schottenstein, AEO's Executive Chairman of the Board and Chief Executive Offcer.
"Entering 2025, the frst quarter is off to a slower start than expected, refecting less robust demand and colder weather. While we anticipate improvement as the Spring season gets underway, we are also taking proactive steps to strengthen the top-line, manage inventory and reduce expenses. As we navigate through an uncertain consumer and operating landscape, we will also remain focused on our long-term strategic priorities," he added.
Fourth Quarter 2024 Results:
● Fourth quarter 2024 results are presented for the 13 weeks ended February 1, 2025 compared to the 14 weeks ended February 3, 2024. Comparable sales metrics are presented for the 13 weeks ended February 1, 2025 compared to the 13 weeks ended February 3, 2024.
● Total comparable sales increased 3%, following 8% reported comp growth last year.
● Total net revenue of $1.6 billion declined 4%. This included approximately $85 million of adverse impact from one less selling week and the retail calendar shift.
● Aerie comparable sales increased 6% on a 13% increase last year. American Eagle comparable sales grew 1% following 6% growth last year.
● Gross proft of $599 million. Gross margin of 37.3% refected higher freight and product costs, offset by lower markdowns. BOW costs were roughly neutral.
● Selling, general and administrative expense of $402 million decreased 6% and leveraged 40 basis points. The improved rate was due to lower compensation, including incentive costs, partially offset by increased advertising.
● Operating income rose slightly to $142 million, refecting an operating margin of 8.9%. This included an approximately $20 million adverse impact from one less selling week and the retail calendar shift.
● Diluted earnings per share was $0.54. Average diluted shares outstanding were 193 million.
Fiscal Year 2024 Results:
● Fiscal Year 2024 results are presented for the 52 weeks ended February 1, 2025 compared to the
53 weeks ending February 3, 2024. Comparable sales metrics are presented for the 52 weeks ended February 1, 2025 compared to the 52 weeks ended February 3, 2024.
● Total comparable sales increased 4%, following 3% reported comp growth last year.
● Total net revenue of $5.3 billion increased 1%. This included an approximately $60 million adverse impact from one less selling week.
● Aerie comparable sales increased 5% on 8% growth last year. American Eagle comparable sales increased 3% following 1% growth last year.
● Gross proft of $2.1 billion increased 3%. Gross margin of 39.2% expanded driven by lower rent, utilities and delivery expenses, with a partial offset from higher markdowns.
● Selling, general and administrative expense of $1.4 billion was roughly in-line to last year and leveraged 30 basis points. The improved rate was due to lower compensation, including incentive costs, partially offset by increased advertising.
● GAAP Operating income of $427 million. Adjusted operating income of $445 million refected an operating margin of 8.3%. This included an approximately $5 million adverse impact from one less selling week.
● GAAP diluted earnings per share was $1.68. Adjusted diluted earnings per share was $1.74. Average diluted shares outstanding were 196 million.
Inventory
Total ending inventory decreased 1% to $637 million. Inventory is healthy and well positioned for the Spring season.
Shareholder Returns
In the fourth quarter the company repurchased 3.5 million shares for $60 million, bringing full-year repurchases to 9.5 million shares for $191 million. The company also returned approximately $24 million in cash to shareholders through its quarterly cash dividend of $0.125 per share, bringing year-to-date cash dividends to $96 million.
New Share Repurchase Authorization
On March 11, 2025, the company's Board of Directors authorized an additional 50 million shares for repurchase under its existing authorization, increasing the total shares available for repurchase to 68.5 million through February 3, 2029.
Share repurchases may be made from time to time in open market or private transactions in such manner as may be deemed advisable from time to time (including, without limitation, pursuant to one or more 10b5-1 trading plans, accelerated share repurchase programs, and any other method that the company may deem advisable) and may be discontinued at any time.
Capital Expenditures
Capital expenditures totaled $65 million in the fourth quarter and $223 million for fscal year 2024. The company expects 2025 capital expenditures to be approximately $300 million. This includes a one-time $40 million cost of relocating to a new Manhattan offce, which provides more favorable lease terms.
Outlook
The company's outlook refects near-term headwinds in the consumer and macroeconomic operating environment, balanced with proactive steps the company is taking to strengthen the top-line and reduce expenses.
First Quarter 2025 Outlook
Fiscal Year 2025 Outlook
Revenue
Mid-single digit decline
Low-single digit decline
Gross Margin
Down YoY
Down YoY
SG&A
Flat dollars
Low-single digit dollar decline
D&A
-
Approximately $230M
Operating Income
$20 to $25 million
$360 to $375 million
Tax Rate
-
Approximately 25%
Weighted Average Share Count
-
Low 190 million*
Capital Expenditures
-
Approximately $300 million
*Does not include repurchase activity beyond offsetting internal grants
Webcast and Supplemental Financial Information
Management will host a conference call and real time webcast today at 4:30pm Eastern Time. To listen to the call, dial 1-877-407-0789 or internationally dial 1-201-689-8562 or go to www.aeo-inc.comto access the webcast and audio replay. Additionally, a fnancial results presentation is posted on the company's website.
* * * *
About American Eagle Outftters, Inc.
American Eagle Outftters, Inc. (NYSE: AEO) is a leading global specialty retailer with a portfolio of beloved apparel brands including American Eagle, Aerie, OFFL/NE by Aerie, Todd Snyder and Unsubscribed. Rooted in optimism, inclusivity and authenticity, AEO's brands empower every customer to celebrate their unique personal style by offering casual, comfortable, timeless outftting and high-quality products that are made to last.
AEO Inc. operates stores in the United States, Canada and Mexico, with merchandise available in more than 30 countries through a global network of license partners. Additionally, the company operates a robust e-commerce business across its brands. For more information, visit aeo-inc.com.
Non-GAAP Measures
This press release includes operating income and diluted earnings per share presented on an adjusted or non-GAAP basis, which are non-GAAP fnancial measures. These fnancial measures are not based on any standardized methodology prescribed by GAAP and are not necessarily comparable to similar measures presented by other companies. Non-GAAP information is provided as a supplement to, not as a substitute
for, or as superior to, measures of fnancial performance prepared in accordance with GAAP. We believe that this non-GAAP information is useful as an additional means for investors to evaluate our operating performance when reviewed in conjunction with our GAAP Consolidated Financial Statements and provides a higher degree of transparency. These amounts are not determined in accordance with GAAP and, therefore, should not be used exclusively in evaluating our business and operations. The tables included in this release reconcile the GAAP fnancial measures to the non-GAAP fnancial measures discussed above for the 52 weeks ended February 1, 2025 and the 13 and 53 weeks ended February 3, 2024.
SAFE HARBOR STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995
This release and related statements by management contain forward-looking statements (as such term is defned in the Private Securities Litigation Reform Act of 1995), which represent management's expectations or beliefs concerning future events, including, without limitation, the outlook for frst fscal quarter and annual fscal 2025. Words such as "outlook," "estimate," "project," "plan," "believe," "expect," "anticipate," "intend," "may," "potential," and similar expressions may identify forward-looking statements, although not all forward-looking statements contain these identifying words. All forward-looking statements made by the company are inherently uncertain because they are based on assumptions and expectations concerning future events and are subject to change based on many important factors, some of which may be beyond the company's control. Except as may be required by applicable law, we undertake no obligation to publicly update or revise any forward-looking statements whether as a result of new information, future events or otherwise and even if experience or future changes make it clear that any projected results expressed or implied therein will not be realized. The following factors, in addition to the risks disclosed in Item 1A., Risk Factors, of our Annual Report on Form 10-K for the fscal year ended February 3, 2024 and in any other flings that we may make with the Securities and Exchange Commission, in some cases have affected, and in the future could affect, the company's fnancial performance and could cause actual results to differ materially from those expressed or implied in any of the forward-looking statements included in this release or otherwise made by management: the risk that the company's operating, fnancial and capital plans may not be achieved; our inability to anticipate customer demand and changing fashion trends and to manage our inventory commensurately; seasonality of our business; our inability to achieve planned store fnancial performance; our inability to react to raw material cost, labor and energy cost increases; our inability to gain market share in the face of declining shopping center traffc; our inability to respond to changes in e-commerce and leverage omni-channel demands; our inability to expand internationally; diffculty with our international merchandise sourcing strategies; the possibility that product costs are adversely affected by foreign trade issues (including import tariffs and other trade restrictions imposed by the U.S., China or other countries), currency exchange rate fuctuations, increasing prices for raw materials, supply chain issues, political instability or other reasons; challenges with information technology systems, including safeguarding against security breaches; and global economic, public health, social, political and fnancial conditions, and the resulting impact on consumer confdence and consumer spending, as well as other changes in consumer discretionary spending habits, which could have a material adverse effect on our business, results of operations and liquidity.
The use of the "company," "AEO," "we," "us," and "our" in this release refers to American Eagle Outftters, Inc.
CONTACT:
Line Media
412-432-3300 LineMedia@ae.com
AMERICAN EAGLE OUTFITTERS, INC. CONSOLIDATED BALANCE SHEETS (Unaudited; Dollars in thousands)
Fiscal Years Ending
February 1, 2025
February 3, 2024
Assets
Current assets:
Cash and cash equivalents
$
308,962
$
354,094
Short-term investments
50,000
100,000
Merchandise inventory
636,655
640,662
Accounts receivable, net
262,365
247,934
Prepaid expenses
76,088
65,082
Other current assets
20,161
25,578
Total current assets
1,354,231
1,433,350
Operating lease right-of-use assets
1,295,400
1,005,293
Property and equipment, at cost, net of accumulated depreciation
751,264
713,336
Goodwill, net
225,079
225,303
Non-current deferred income taxes
68,158
82,064
Intangible assets, net
42,449
46,109
Other assets
94,194
52,454
Total assets
$
3,830,775
$
3,557,909
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable
$
280,712
$
268,308
Current portion of operating lease liabilities
313,034
284,508
Accrued compensation and payroll taxes
113,388
152,353
Unredeemed gift cards and gift certificates
70,094
66,285
Accrued income and other taxes
30,677
46,114
Other current liabilities and accrued expenses
74,751
73,604
Total current liabilities
882,656
891,172
Non-current liabilities:
Non-current operating lease liabilities
1,133,296
901,122
Other non-current liabilities
47,963
28,856
Total non-current liabilities
1,181,259
929,978
Commitments and contingencies
-
-
Stockholders' equity:
Preferred stock
-
-
Common stock
2,496
2,496
Contributed capital
365,845
360,378
Accumulated other comprehensive loss
(56,390)
(16,410)
Retained earnings
2,456,063
2,214,159
Treasury stock
(1,001,154)
(823,864)
Total stockholders' equity
1,766,860
1,736,759
Total liabilities and stockholders' equity
$
3,830,775
$
3,557,909
Current Ratio
1.53
1.61
AMERICAN EAGLE OUTFITTERS, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited; Dollars and shares in thousands, except per share amounts)
GAAP Basis
Fourth Quarter Ended
February 1, 2025
February 3, 2024
(In thousands)
(Percentage of revenue)
(In thousands)
(Percentage of revenue)
Total net revenue
$
1,604,633
100.0 %
$
1,678,910
100.0
%
Cost of sales, including certain buying, occupancy and warehouse expenses
1,005,458
62.7
1,064,324
63.4
Gross profit
599,175
37.3
614,586
36.6
Selling, general and administrative expenses
401,628
25.0
427,090
25.4
Impairment, restructuring and other charges
-
0.0
120,420
7.1
Depreciation and amortization expense
55,277
3.4
57,840
3.5
Operating income
142,470
8.9
9,236
0.6
Interest (income), net
(2,355)
(0.1)
(4,961)
(0.3)
Other (income), net
(3,154)
(0.2)
(1,505)
(0.1)
Income before income taxes
$
147,779
9.2
$
15,702
1.0
Provision for income taxes
43,433
2.7
9,386
0.6
Net income
$
104,346
6.5
%
$
6,316
0.4
%
Net income per basic share
$
0.55
$
0.03
Net income per diluted share
$
0.54
$
0.03
Weighted average common shares outstanding - basic
190,497
197,524
Weighted average common shares outstanding - diluted
193,496
199,589
AMERICAN EAGLE OUTFITTERS, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited; Dollars and shares in thousands, except per share amounts)
GAAP Basis
Fiscal Year Ended
February 1, 2025
February 3, 2024
(In thousands)
(Percentage of revenue)
(In thousands)
(Percentage of revenue)
Total net revenue
$
5,328,652
100.0 %
$
5,261,770
100.0
%
Cost of sales, including certain buying, occupancy and warehouse expenses
3,239,719
60.8
3,237,192
61.5
Gross profit
2,088,933
39.2
2,024,578
38.5
Selling, general and administrative expenses
1,431,814
26.9
1,433,300
27.2
Impairment, restructuring, and other charges
17,561
0.3
141,695
2.7
Depreciation and amortization expense
212,255
4.0
226,866
4.4
Operating income
427,303
8.0
222,717
4.2
Interest (income), net
(7,769)
(0.1)
(6,190)
(0.1)
Other (income), net
(7,162)
(0.1)
(10,951)
(0.2)
Income before income taxes
$
442,234
8.2
$
239,858
4.5
Provision for income taxes
112,854
2.0
69,820
1.3
Net income
$
329,380
6.2
%
$
170,038
3.2
%
Net income per basic share
$
1.71
$
0.87
Net income per diluted share
$
1.68
$
0.86
Weighted average common shares outstanding - basic
193,056
195,646
Weighted average common shares outstanding - diluted
196,412
196,863
AMERICAN EAGLE OUTFITTERS, INC.
NET REVENUE BY SEGMENT (Unaudited; Dollars in thousands)
Fourth Quarter Ended
Fiscal Year Ended
February 1, 2025
February 3, 2024
February 1, 2025
February 3, 2024
Net Revenue:
American Eagle
$
1,000,935
$
1,066,092
$
3,385,231
$
3,361,579
Aerie
539,673
537,462
1,738,414
1,670,000
Other
74,906
159,576
243,907
489,056
Intersegment Elimination
(10,881)
(84,220)
(38,900)
(258,865)
Total Net Revenue
$
1,604,633
$
1,678,910
$
5,328,652
$
5,261,770
Disclaimer
American Eagle Outfitters Inc. published this content on March 12, 2025, and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on March 12, 2025 at 20:08:27.908.