MW Hollister sales are booming, and that's making the Abercrombie brand look bad

By Tomi Kilgore

Apparel retailer's stock bounces sharply off a two-year low, as strength in Hollister sales led to another earnings beat, and a raised full-year outlook

Abercrombie's stock is soaring as the apparel retailer's Hollister-brand stores continue to enjoy their moment.

Shares of Abercrombie & Fitch Co. bounced sharply on Tuesday, after the apparel retailer reported record third-quarter sales, as its Hollister-branded stores continued to shine to help overcome continued weakness in the company's namesake stores.

The upbeat results, which included a profit beat and raised full-year outlook, come just a day after the stock had closed at a two-year low, as the company also beat profit expectations again, and provided some hope that Abercrombie-brand sales may be poised to bottom.

The stock $(ANF)$ shot up 17.6% in recent morning trading, toward its best one-day performance in since it ran up 24.3% on May 29, 2024, after closing Monday at the lowest price since Nov. 3, 2023.

While the company said it's enjoyed three years of consecutive year-over-year sales growth, the stock has been suffering in an environment in which shares of retailers known for discounts, such as Walmart Inc. $(WMT)$ and TJ Maxx parent TJX Cos. $(TJX)$, have been benefiting as consumers of all income types have become more price-conscious given stubborn inflation, tariff uncertainty and a softening job market.

That's likely helping the Hollister brand have a moment, as its apparel is viewed as a lower-priced alternative to offerings at the company's Abercrombie-branded stores.

The company reported total sales for the quarter to Nov. 1 that grew 6.8% from a year ago to $1.29 billion, a record for the third quarter, and just above the average analyst sales estimate compiled by FactSet of $1.28 billion.

Hollister sales jumped 16.3% to $673.3 million, well above the FactSet consensus of $647.6 million, to mark the seventh straight beat. Meanwhile, Abercrombie sales declined 2% to $617.3 million, below the FactSet consensus of $632.7 million. That was the third straight sales decline for the brand and the fifth straight miss.

On a bright note, Chief Executive Fran Horowitz said on an earnings call with analysts that she aims for Abercrombie sales to be "approximately flat" in the current quarter, after sales reached a record a year ago.

"We're excited to see that milestone within reach," Horowitz said, according to a FactSet transcript of the call.

Net income for the latest quarter was down 14.4% to $113 million, and earnings per share slipped to $2.36 from $2.50 but topped the FactSet consensus of $2.17.

What's been helping the bottom line is that the company has pulled back on promotions, with average unit retail, or the average price of products sold, having improved.

And for the full fiscal year, the company nudged up its guidance ranges for net sales growth to 6% to 7% from 5% to 7% and for EPS to $10.20 to $10.50 from $10 to $10.50. The outlook continues to assume about $90 million in tariff expenses for the year, which represents about 1.7% of net sales.

Horowitz stressed that the company has kept inventory tight ahead of the holidays, with the goal of reducing promotions and clearance selling to mitigate some of the additional costs from the tariffs put in place by the Trump White House.

Despite Tuesday's rally, the stock has dropped 48.4% in 2025, while the State Street SPDR S&P Retail ETF XRT has gained 2.1% and the S&P 500 index SPX has advanced 13.7%.

-Tomi Kilgore

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November 25, 2025 10:29 ET (15:29 GMT)

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