AEO Inc. reports growth across all brands for Q3

AEO Inc. reported an increase of 3 percent in total comparable sales for its third quarter, following a 5 percent growth in comparable sales during the same period last year, highlighting the success of the company’s profitable growth plan.

The parent company of American Eagle and Aerie, AEO Inc., reported a 1 percent decline in total net revenue for the 13 weeks ending November 2, 2024, which included approximately 45 million dollars of adverse impact from the retail calendar shift.

Millennial and Ben Z favorite brand Aerie reported record-breaking revenue for the third quarter, with comparable sales rising 5 percent, building on a 12 percent increase in the same period last year.

American Eagle also saw growth, with comparable sales up 3 percent, following a 2 percent increase in the prior year. Operating income for the quarter totaled 106 million dollars, while adjusted operating income reached 124 million dollars, reflecting an adjusted operating margin of 9.6 percent.

Gross profit for the third quarter totaled 527 million dollars, a 3 percent decline from the previous year. The gross margin declined to 40.9 percent, down from 41.8 percent last year, due to higher markdowns and increased expenses driven by a shift in the retail calendar.

“Building on our positive performance in the first half of the year, third-quarter results provide another proof point of the effectiveness of our Powering Profitable Growth Plan,” said Jay Schottenstein, AEO’s executive chairman of the board and CEO of AEO Inc., in a statement. “Led by a strong back-to-school season, we achieved comparable sales growth across brands and channels and delivered adjusted operating income at the high end of our guidance range.”

AEO Inc. noted that it had updated its annual outlook and remains on track to achieve mid-teen adjusted operating income growth, aligning with its long-term goals.

“We have entered the holiday season well positioned, with our leading brands offering high-quality merchandise, great gifts, and an outstanding shopping experience across channels. Key selling periods have seen a positive customer response, yet we remain cognizant of potential choppiness during non-peak periods. The teams are focused on delivering the quarter and with our strong year-to-date performance, we remain confident in achieving our long-term strategic objectives,” added Schottenstein.