Abercrombie & Fitch : Q2 2026 Earnings Financials

About this update from Abercrombie & Fitch Company

Abercrombie & Fitch Co. Condensed Consolidated Statements of Operations (in thousands, except per share data) (Unaudited) Twenty-Six Weeks Ended Twenty-Six Weeks Ended % of % of August 1, 2026 Net Sales August 2, 2025 Net Sales Net sales $ 2,380,510 100.0 % $ 2,305,871 100.0 % Cost of sales, exclusive of depreciation and amortization 779,947 32.8 % 868,723 37.7 % Selling expense 875,237 36.8 % 775,293 33.6 % General and administrative expense 387,538 16.3 % 350,250 15.2 % Other operating (income) loss, net (3,709) (0.2)% 3,414 0.1 % Operating income 341,497 14.3 % 308,191 13.4 % Interest expense 1,011 - % 1,281 0.1 % Interest income (13,889) (0.6)% (10,538) (0.5)% Interest income, net (12,878) (0.5)% (9,257) (0.4)% Income before income taxes 354,375 14.9 % 317,448 13.8 % Income tax expense 100,717 4.2 % 92,321 4.0 % Net income 253,658 10.7 % 225,127 9.8 % Less: Net income attributable to noncontrolling interests 2,804 0.1 % 3,331 0.1 % Net income attributable to A&F $ 250,854 10.5 % $ 221,796 9.6 % Net income per share attributable to A&F Basic $ 5.65 $ 4.58 Diluted $ 5.59 $ 4.47 Weighted-average shares outstanding: Basic 44,368 48,382 Diluted 44,864 49,592 Reporting and Use of GAAP and Non-GAAP Measures The company believes that each of the non-GAAP financial measures presented are useful to investors as they provide a measure of the company's operating performance excluding the effect of certain items which the company believes do not reflect its future operating outlook, therefore supplementing investors' understanding of comparability of operations across periods. Management used these non-GAAP financial measures during the periods presented to assess the company's performance and to develop expectations for future operating performance. Non-GAAP financial measures should be used supplementally to, and not as an alternative to, the company's GAAP financial results, and may not be calculated in the same manner as similar measures presented by other companies. The company provides comparable sales, defined as the percentage year-over-year change in the aggregate of: (1) sales for stores that have been open as the same brand at least one year and whose square footage has not been expanded or reduced by more than 20% within the past year, with prior year's net sales converted at the current year's foreign currency exchange rate to remove the impact of foreign currency rate fluctuation, and (2) digital net sales with prior year's net sales converted at the current year's foreign currency exchange rate to remove the impact of foreign currency rate fluctuation. The company also provides certain financial information on a constant currency basis to enhance investors' understanding of underlying business trends and operating performance, by removing the impact of foreign currency exchange rate fluctuations. The effect from foreign currency, calculated on a constant currency basis, is determined by applying current year average exchange rates to prior year results and is net of the year-over-year impact from hedging. The per diluted share effect from foreign currency is calculated using a 26% tax rate. In addition, the company provides EBITDA and adjusted EBITDA as supplemental measures used by the company's executive management to assess the company's performance. We also believe these supplemental performance measures are meaningful information for investors and other interested parties to use in computing the company's core financial performance over multiple periods and with other companies by excluding the impact of differences in tax jurisdictions, debt service levels and capital investment. Abercrombie & Fitch Co. Schedule of Non-GAAP Financial Measures Thirteen Weeks Ended August 2, 2025 (in thousands, except per share data) (Unaudited) GAAP (1) Excluded items Adjusted non-GAAP Litigation settlement (2) $ (38,574) $ (38,574) $ - Operating income 206,658 38,574 168,084 Income before income taxes 209,132 38,574 170,558 Income tax expense (3) 65,744 9,949 55,795 Net income attributable to A&F $ 141,383 $ 28,625 $ 112,758 Net income per diluted share attributable to A&F $ 2.91 $ 0.59 $ 2.32 Diluted weighted-average shares outstanding: 48,551 48,551 (1) "GAAP" refers to accounting principles generally accepted in the United States of America. (2) Excluded items consist of favorable settlement, net of legal fees, of claims to resolve payment card interchange fee antitrust litigation. (3) The tax effect of excluded items is the difference between the tax provision calculated on a GAAP basis and an adjusted non-GAAP basis. Schedule of Non-GAAP Financial Measures Twenty-Six Weeks Ended August 2, 2025 (in thousands, except per share data) (Unaudited) GAAP (1) Excluded items Adjusted non-GAAP Litigation settlement (2) $ (38,574) $ (38,574) $ - Operating income 308,191 38,574 269,617 Income before income taxes 317,448 38,574 278,874 Income tax expense (3) 92,321 9,949 82,372 Net income attributable to A&F $ 221,796 $ 28,625 $ 193,171 Net income per diluted share attributable to A&F $ 4.47 $ 0.58 $ 3.90 Diluted weighted-average shares outstanding: 49,592 49,592 (1) "GAAP" refers to accounting principles generally accepted in the United States of America. (2) Excluded items consist of favorable settlement, net of legal fees, of claims to resolve payment card interchange fee antitrust litigation. (3) The tax effect of excluded items is the difference between the tax provision calculated on a GAAP basis and an adjusted non-GAAP basis. Reconciliation of Constant Currency Financial Measures Thirteen Weeks Ended August 1, 2026 and August 2, 2025 (in thousands, except percentage and basis point changes and per share data) (Unaudited) 2026 2025 % Change Net sales GAAP (1) $ 1,266,689 $ 1,208,560 5% Impact from changes in foreign currency exchange rates (2) - (223) - Net sales on a constant currency basis $ 1,266,689 $ 1,208,337 5% Operating income 2026 2025 BPS Change (4) GAAP (1) $ 252,700 $ 206,658 280 Excluded item (3) - 38,574 (320) Adjusted non-GAAP $ 252,700 $ 168,084 600 Impact from changes in foreign currency exchange rates (2) - 787 (10) Non-GAAP constant currency basis $ 252,700 $ 168,871 590 Net income per share attributable to A&F 2026 2025 $ Change GAAP (1) $ 4.17 $ 2.91 $1.26 Excluded item, net of tax (3) - 0.59 (0.59) Adjusted non-GAAP $ 4.17 $ 2.32 $1.85 Impact from changes in foreign currency exchange rates (2) - 0.01 (0.01) Non-GAAP constant currency basis $ 4.17 $ 2.33 $1.84 (1) "GAAP" refers to accounting principles generally accepted in the United States of America. (2) The estimated impact from foreign currency is determined by applying current period exchange rates to prior year results and is net of the year-over-year impact from hedging. The per diluted share estimated impact from foreign currency is calculated using a 26% tax rate. (3) Excluded item consists of favorable settlement, net of legal fees, of payment card interchange fee litigation. (4) The estimated basis point change has been rounded based on the percentage change. Abercrombie & Fitch Co. Reconciliation of EBITDA and Adjusted EBITDA Thirteen Weeks Ended August 1, 2026 and August 2, 2025 (in thousands) (Unaudited) % of % of 2026 Net Sales 2025 Net Sales Net income $ 185,539 14.6 % $ 143,388 11.9 % Income tax expense 74,752 5.9 65,744 5.4 Interest income, net (7,591) (0.6) (2,474) (0.2) Depreciation and amortization 43,279 3.5 37,424 3.1 EBITDA (1) $ 295,979 23.4 % $ 244,082 20.2 % Adjustments to EBITDA Litigation settlement - - (38,574) (3.2) Adjusted EBITDA (1) $ 295,979 23.4 % $ 205,508 17.0 % Abercrombie & Fitch Co. Reconciliation of EBITDA and Adjusted EBITDA Twenty-Six Weeks Ended August 1, 2026 and August 2, 2025 (in thousands) (Unaudited) % of % of 2026 Net Sales 2025 Net Sales Net income $ 253,658 10.7 % $ 225,127 9.8 % Income tax expense 100,717 4.2 92,321 4.0 Interest (income) expense, net (12,878) (0.5) (9,257) (0.4) Depreciation and amortization 85,583 3.5 76,000 3.3 EBITDA (1) $ 427,080 17.9 % $ 384,191 16.7 % Adjustments to EBITDA Litigation settlement - - (38,574) (1.7) Adjusted EBITDA (1) $ 427,080 17.9 % $ 345,617 15.0 % (1) EBITDA and Adjusted EBITDA are supplemental financial measures that are not defined or prepared in accordance with GAAP. EBITDA is defined as net income before interest, income taxes and depreciation and amortization. Adjusted EBITDA is EBITDA adjusted for a favorable settlement, net of legal fees, of payment card interchange fee litigation. Condensed Consolidated Balance Sheets (in thousands) (Unaudited) August 1, 2026 January 31, 2026 August 2, 2025 Assets Current assets: Cash and equivalents $ 627,716 $ 759,540 $ 572,730 Marketable securities 10,283 25,036 30,795 Receivables 190,347 146,757 174,000 Inventories 591,662 601,218 592,966 Other current assets 125,670 117,913 118,624 Total current assets 1,545,678 1,650,464 1,489,115 Property and equipment, net 708,576 674,079 638,590 Operating lease right-of-use assets 1,107,421 997,399 933,559 Other assets 233,181 219,932 240,677 Total assets $ 3,594,856 $ 3,541,874 $ 3,301,941 Liabilities and stockholders' equity Current liabilities: Accounts payable $ 354,209 $ 377,465 $ 368,051 Accrued expenses 443,364 465,549 429,616 Short-term portion of operating lease liabilities 262,354 241,265 223,020 Income taxes payable 38,871 21,721 17,354 Total current liabilities $ 1,098,798 $ 1,106,000 $ 1,038,041 Long-term liabilities: Long-term portion of operating lease liabilities $ 1,025,086 $ 926,830 $ 876,461 Other liabilities 101,310 88,633 80,235 Total long-term liabilities 1,126,396 1,015,463 956,696 Total Abercrombie & Fitch Co. stockholders' equity 1,354,521 1,403,895 1,292,255 Noncontrolling interests 15,141 16,516 14,949 Total stockholders' equity 1,369,662 1,420,411 1,307,204 Total liabilities and stockholders' equity $ 3,594,856 $ 3,541,874 $ 3,301,941 Condensed Consolidated Statements of Cash Flows (in thousands, except per share data) (Unaudited) Twenty-Six Weeks Ended August 1, 2026 August 2, 2025 Operating activities Net cash provided by operating activities $ 313,401 $ 112,893 Investing activities Purchases of marketable securities $ (19,600) $ - Proceeds from maturities of marketable securities 34,600 85,000 Purchases of property and equipment (129,357) (116,943) Net cash used for investing activities $ (114,357) $ (31,943) Financing activities Purchases of common stock (286,446) $ (251,223) Acquisition of common stock for tax withholding obligations (38,573) (34,830) Other financing activities (4,797) (4,660) Net cash used for financing activities $ (329,816) $ (290,713) Effect of foreign currency exchange rates on cash $ (1,159) $ 9,700 Net decrease in cash and equivalents, and restricted cash and equivalents $ (131,931) $ (200,063) Cash and equivalents, and restricted cash and equivalents, beginning of period $ 766,916 $ 780,395 Cash and equivalents, and restricted cash and equivalents, end of period $ 634,985 $ 580,332 Approximate U.S. Tariff Impact Quarterly History Total Tariff Expense (Benefit) (Approximate, $ Millions) FY 2025 FY 2026 Q1 Q2 Q3 Q4 FY Q1 Q2 Tariff Expense (Benefit) (1) $- $5 $25 $60 $90 $20 $15 IEEPA Tariff Refund (2) $- $- $- $- $- $- $(100) Total Tariff Impact ($ Millions) (3) $- $5 $25 $60 $90 $20 $(85) Year-Over-Year Expense (Benefit) (Approximate, $ Millions) FY 2025 FY 2026 Q1 Q2 Q3 Q4 FY Q1 Q2 Tariff Expense (Benefit) (1) $- $5 $25 $60 $90 $20 $10 IEEPA Tariff Refund (2) $- $- $- $- $- $- $(100) Total Tariff Impact ($ Millions) (3) $- $5 $25 $60 $90 $20 $(90) Year-Over-Year Expense (Benefit) (Approximate, Basis Points) FY 2025 FY 2026 Q1 Q2 Q3 Q4 FY Q1 Q2 Tariff Expense (Benefit) -bps 40bps 210bps 370bps 170bps 180bps 100bps IEEPA Tariff Refund -bps -bps -bps -bps -bps -bps (790)bps Total Tariff Impact (Basis Points) -bps 40bps 210bps 370bps 170bps 180bps (690)bps (1) Reflects the estimated impact, net of mitigation efforts, of then-effective tariff rates on all goods imported into the United States and sold, for the period. Includes IEEPA, Section 122, and Section 301 tariffs. (2) Reflects the impact of IEEPA tariff refunds, excluding accrued interest. (3) The combined estimated impact of the tariff expense and IEEPA tariff refunds is included in the Company's fiscal 2026 outlook, including operating margin and net income per diluted share. Refer to outlook section for further detail. Separately, for the second quarter of 2026, we estimate IEEPA tariff refunds of approximately $100 million had a beneficial impact of $1.75 on net income per diluted share. (in thousands, except per share data) Fiscal 2025 Fiscal 2026 2024 Q1 Q2 Q3 Q4 2025 Q1 Q2 2026 Net sales $ 4,948,587 $ 1,097,311 $ 1,208,560 $ 1,290,619 $ 1,669,802 $ 5,266,292 $ 1,113,821 $ 1,266,689 $ 2,380,510 Cost of sales, exclusive of depreciation and amortization 1,773,926 417,133 451,590 483,670 676,491 2,028,884 413,838 366,109 779,947 Selling expense 1,689,988 399,937 375,356 459,548 574,792 1,809,633 431,195 444,042 875,237 General and administrative expense 750,485 174,925 175,325 193,402 181,819 725,471 182,754 204,784 387,538 Other operating (income) loss, net (6,632) 3,783 (369) (1,022) 769 3,161 (2,763) (946) (3,709) Operating income 740,820 101,533 206,658 155,021 235,931 699,143 88,797 252,700 341,497 Interest expense 12,077 661 620 550 544 2,375 450 561 1,011 Interest income (39,934) (7,444) (3,094) (6,491) (6,975) (24,004) (5,737) (8,152) (13,889) Interest (income) expense, net (27,857) (6,783) (2,474) (5,941) (6,431) (21,629) (5,287) (7,591) (12,878) Income before income taxes 768,677 108,316 209,132 160,962 242,362 720,772 94,084 260,291 354,375 Income tax expense 194,661 26,577 65,744 45,862 67,594 205,777 25,965 74,752 100,717 Net income 574,016 81,739 143,388 115,100 174,768 514,995 68,119 185,539 253,658 Less: Net income attributable to noncontrolling interests 7,793 1,326 2,005 2,105 2,638 8,074 985 1,819 2,804 Net income attributable to Abercrombie & Fitch Co. $ 566,223 $ 80,413 $ 141,383 $ 112,995 $ 172,130 $ 506,921 $ 67,134 $ 183,720 $ 250,854 Net income per share attributable to Abercrombie & Fitch Co.: Basic $11.14 $1.63 $2.97 $2.41 $3.77 $10.71 $1.49 $4.20 $5.65 Diluted $10.69 $1.59 $2.91 $2.36 $3.68 $10.46 $1.47 $4.17 $5.59 Weighted-average shares outstanding: Basic 50,839 49,214 47,550 46,842 45,668 47,319 44,969 43,767 44,368 Diluted 52,971 50,634 48,551 47,881 46,837 48,476 45,677 44,051 44,864 Fiscal 2025 Fiscal 2026 2024 Q1 Q2 Q3 Q4 2025 Q1 Q2 2026 Comparable sales by segment: (1) Americas comparable sales (2) (3) 17% 4% 5% 4% 2% 4% 1% 1 % 1 % EMEA comparable sales (2) (4) 16% 6% -5% 2% -3% -% -11% (4)% (8)% APAC comparable sales (2) (5) 19% 2% 1% -12% -% -3% 15% 13 % 14 % Comparable sales (2) 17% 4% 3% 3% 1% 3% -1% - % - % Comparable sales by brand family: Abercrombie comparable sales (2) 15% -10% -11% -7% -1% -7% -% 4 % 2 % Hollister comparable sales (2) 19% 23% 19% 15% 3% 13% -2% -3 % (2)% Comparable sales (2) 17% 4% 3% 3% 1% 3% -1% - % - % (1) Comparable sales by segment are presented by attributing revenues to a physical store location or geographical region that fulfills the order. (2) Comparable sales are calculated on a constant currency basis. Refer to "REPORTING AND USE OF GAAP AND NON-GAAP MEASURES," for further discussion. (3) The Americas segment includes the results of operations in North America and South America. (4) The EMEA segment includes the results of operations in Europe, the Middle East and Africa. (5) The APAC segment includes the results of operations in the Asia-Pacific region, including Asia and Oceania.

View stock analysis, news, and events for Abercrombie & Fitch Company