American Eagle Outfitters (AEO) has raised its full-year outlook as it swung to a profit in the three months to July 29.
The company made a net profit of 48.6 million dollars in the second quarter from a loss of 42.5 million dollars a year earlier, while its operating profit widened to 65.3 million dollars from 14 million dollars.
For the full-year, AEO now expects operating income of between 325 million dollars and 350 million dollars, up from prior guidance of between 250 million dollars and 270 million dollars.
It comes as sales at the US fashion retailer edged up slightly to a record 1.2 billion dollars in the second quarter.
The company now expects full-year revenue to be up low single digits from the prior year, compared to earlier guidance of flat to down low single digits.
AEO raises outlook
“I am pleased to report second quarter revenue and operating profit that exceeded our expectations,” said AEO chair and CEO Jay Schottenstein in a statement.
He said demand picked up in June and July, and the “positive momentum” has continued into the third quarter, “across brands and channels”.
“Looking to the second half, we are excited about future product arrivals, leveraging the positive response to early fall goods, and delivering innovative customer connections,” Schottenstein said.
However, he said the company is keeping a “sharp eye on the consumer environment and planning appropriately”.
He continued: “We are taking action to position the business for improved profit, with preliminary initiatives included in our increased 2023 outlook.
“As we continue to optimize our operations, I am confident in our ability to strengthen profitability longer-term.”