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Abercrombie Trims Growth Forecast as Tariff Costs Mount

MarketDash Editorial Team
21 hours ago
Abercrombie & Fitch narrowed its sales growth outlook to 6% for fiscal 2025, citing $90 million in tariff-related expenses. Despite record sales through December, the adjusted forecast sent shares tumbling more than 16%.

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Abercrombie & Fitch Co. (ANF) delivered some mixed signals on Monday, tightening its fiscal 2025 outlook even as the retailer reported record sales through December. The company now expects full-year net sales growth of at least 6%, backing off its previous 6%-7% forecast. Investors weren't thrilled—shares dropped more than 16%.

Here's the thing: Abercrombie is dealing with tariff headwinds that are starting to bite. The updated outlook includes an estimated $90 million in tariff-related costs, net of whatever mitigation strategies the company has deployed. That translates to about 170 basis points of pressure on net sales, which is not exactly trivial.

The company is projecting a full-year operating margin around 13%, with fourth-quarter revenue growth expected near 5% and an operating margin close to 14%. Management guided full-year diluted EPS to $10.30-$10.40 and fourth-quarter EPS to $3.50-$3.60, suggesting they still see solid demand despite tougher year-over-year comparisons.

This comes after a strong third quarter where Abercrombie beat expectations and actually raised guidance to that 6%-7% range (up from 5%-7% previously). The company posted adjusted EPS of $2.36 on $1.29 billion in revenue, with particular strength in the Americas and EMEA regions. Management still believes fiscal 2025 will be a record year—just slightly less record than they thought a few months ago.

On capital allocation, Abercrombie is sticking with its plan to repurchase approximately $450 million in shares during fiscal 2025, including roughly $100 million in the fourth quarter. The company also bumped up expected capital expenditures to around $245 million to fund investments in digital infrastructure, marketing, and store operations.

CEO Fran Horowitz noted that the Hollister brand is tracking toward mid-teens net sales growth for fiscal 2025, while the Abercrombie brand is expected to deliver low single-digit growth in the fourth quarter as it laps a tough comparison from last year's strong performance.

The company will meet with investors and analysts at the ICR Conference on January 12-13, 2026, where further details on the outlook and long-term strategy are expected.

ANF Price Action: Abercrombie & Fitch shares were down 16.53% at $104.23 at the time of publication on Monday.

Back to Stock Market News

Abercrombie Trims Growth Forecast as Tariff Costs Mount

MarketDash Editorial Team
21 hours ago
Abercrombie & Fitch narrowed its sales growth outlook to 6% for fiscal 2025, citing $90 million in tariff-related expenses. Despite record sales through December, the adjusted forecast sent shares tumbling more than 16%.

Get American Eagle Outfitters Alerts

Weekly insights + SMS alerts

Abercrombie & Fitch Co. (ANF) delivered some mixed signals on Monday, tightening its fiscal 2025 outlook even as the retailer reported record sales through December. The company now expects full-year net sales growth of at least 6%, backing off its previous 6%-7% forecast. Investors weren't thrilled—shares dropped more than 16%.

Here's the thing: Abercrombie is dealing with tariff headwinds that are starting to bite. The updated outlook includes an estimated $90 million in tariff-related costs, net of whatever mitigation strategies the company has deployed. That translates to about 170 basis points of pressure on net sales, which is not exactly trivial.

The company is projecting a full-year operating margin around 13%, with fourth-quarter revenue growth expected near 5% and an operating margin close to 14%. Management guided full-year diluted EPS to $10.30-$10.40 and fourth-quarter EPS to $3.50-$3.60, suggesting they still see solid demand despite tougher year-over-year comparisons.

This comes after a strong third quarter where Abercrombie beat expectations and actually raised guidance to that 6%-7% range (up from 5%-7% previously). The company posted adjusted EPS of $2.36 on $1.29 billion in revenue, with particular strength in the Americas and EMEA regions. Management still believes fiscal 2025 will be a record year—just slightly less record than they thought a few months ago.

On capital allocation, Abercrombie is sticking with its plan to repurchase approximately $450 million in shares during fiscal 2025, including roughly $100 million in the fourth quarter. The company also bumped up expected capital expenditures to around $245 million to fund investments in digital infrastructure, marketing, and store operations.

CEO Fran Horowitz noted that the Hollister brand is tracking toward mid-teens net sales growth for fiscal 2025, while the Abercrombie brand is expected to deliver low single-digit growth in the fourth quarter as it laps a tough comparison from last year's strong performance.

The company will meet with investors and analysts at the ICR Conference on January 12-13, 2026, where further details on the outlook and long-term strategy are expected.

ANF Price Action: Abercrombie & Fitch shares were down 16.53% at $104.23 at the time of publication on Monday.