American Eagle Outfitters reports 10 percent revenue increase in first quarter

The US retail group American Eagle Outfitters (AEO) announced financial results for the first quarter ended May 2, 2026, delivering double-digit top-line growth and operating income ahead of guidance. Total net revenue reached 1.20 billion dollars, representing a 10 percent increase compared to the same period last year. Total comparable sales for the company rose by 8 percent.

The quarterly performance was driven primarily by the strong momentum of the group’s intimate apparel and lifestyle brand Aerie, which recorded a 25 percent increase in comparable sales. The brand achieved multi-channel growth and profitability, supported by its ongoing '100% Aerie REAL' marketing campaign. In contrast, results at the American Eagle brand were mixed, with comparable sales decreasing by 2 percent.

AEO executive chairman of the board and chief executive officer Jay Schottenstein stated that the quarter reflected the strength of the portfolio and the power of Aerie. Schottenstein added that team members are moving decisively to reignite the women’s business, strengthen product execution and position the brand effectively. He noted that despite continued consumer and macroeconomic uncertainty, the company remains confident in its ability to navigate near-term headwinds.

Gross profit and operating margins expand

Gross profit for the first quarter rose by 41 percent to 456 million dollars, compared to 322 million dollars in the prior year. The gross margin expanded by 860 percentage points to 38.2 percent.

The group posted an operating profit of 28 million dollars, compared to an operating loss of 85 million dollars, or 68 million dollars on an adjusted basis, last year. The operating margin stood at 2.4 percent, compared to a negative 7.8 percent, or an adjusted operating margin of negative 6.2 percent, in the same quarter last year.

Financial outlook for fiscal year 2026

The company provided guidance based on current estimates, factoring in an estimated tariff rate of 10 percent for second quarter receipts and 15 percent for the second half of the fiscal year. The guidance excludes any potential impact from International Emergency Economic Powers Act tariff refunds.

For the second quarter of 2026, AEO expects comparable sales to increase by a mid-to-high single digit percentage, while the gross margin is expected to decline year-over-year. Operating income for the second quarter is projected to fall between 45 million dollars and 50 million dollars.

For the full fiscal year 2026, the group projects comparable sales to rise by a mid single digit percentage, with the gross margin expected to increase YoY. Full-year operating income is forecasted to reach between 390 million dollars and 410 million dollars.