On Wednesday, American Eagle Outfitters, Inc. (NYSE:AEO), announced its financial results for the quarter ended October 29, with revenues and earnings increasing compared to the same period last year.
According to the report, in the third quarter, the company’s revenue increased 2.34% to $940.6 million, which was in line with the analysts’ estimates of $940.9 million. In accordance with the previous estimate of $0.41 per share, American Eagle announced profits of $75.8 million, or $0.41 per share, rising from the profit of $74.1 million, or $0.38 per share the same period last year.
The overall comparable sales growth of the company was 2% in the third quarter, which was below the analysts’ estimates of 2.9%. For Aerie, the lingerie brand of the company, sales rose 21%, while the namesake brand increased 0.4%.
“Aerie continues to post positive same-store sales. However, the American Eagle brand is so much larger and in that concept decelerates the (positive) impact on the comps,” Simeon Sigel, the retail analyst said.
“I’m pleased that we continued to deliver strong results in a tough retail climate, with the third quarter reaching record sales and marking the 9th consecutive quarter of profit improvement,” Jay Schottenstein, the Chief Executive Officer, said in the report. “We will continue to leverage our leading capabilities to maintain momentum and build on the progress we’ve made over the past few years.”
In the report, the company also released the guidance for the fourth quarter. American Eagle expected the EPS to be between $0.37 to $0.39 per share, and the comparable sales were expected to be in the range of flat to a low single digit increase, compared to the 4% increase the same period last year. EPS of the fourth quarter last year was $0.42 per share and adjusted EPS was $0.35.
Due to the disappointing forecasts of fourth quarter results, shares of the company dropped in pre-trading market and decreases 14.27% to $16.23 per share in afternoon trading hours.