Tariff refunds boost American Eagle Outfitters' Q2 performance

US fashion retailer American Eagle Outfitters (AEO) announced financial results for the second quarter ended August 1, 2026, recording an 8 percent increase in total net revenue to 1.38 billion dollars. Total comparable sales rose 6 percent, driven primarily by strong momentum at Aerie.

Operating profit grew to 211 million dollars compared to 103 million dollars in the same period last year. Results benefited from a net operating income advantage of 161 million dollars related to International Emergency Economic Powers Act (IEEPA) tariff refunds.

“The second quarter reflects the value of our AEO Inc. portfolio, led by the broad-based momentum of Aerie and OFFLINE, alongside encouraging progress at American Eagle,” said AEO chief executive officer Jay Schottenstein.

Brand performance and operating margins

Aerie comparable sales increased 19 percent during the second quarter. American Eagle recorded sequential improvement from the first quarter, though comparable sales declined 1 percent. Men’s apparel achieved its fourth consecutive quarter of growth.

Gross profit reached 672 million dollars, up 34 percent from 500 million dollars last year. Gross margin expanded 980 basis points to 48.7 percent, including a net benefit of 179 million dollars from tariff refunds.

Diluted earnings per share reached 0.79 dollars compared to 0.45 dollars in the prior year period.

Outlook for third quarter and full year

For the third quarter of fiscal year 2026, AEO expects comparable sales to increase in the mid-to-high single digits. Gross margin is expected to remain flat year-over-year, while operating income is forecasted between 110 million dollars and 115 million dollars.

For the full fiscal year 2026, the retailer anticipates mid-single-digit comparable sales growth. Gross margin is expected to rise year-over-year, with operating income projected between 540 million dollars and 550 million dollars. All guidance figures include the impact of IEEPA tariff refunds.