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American Eagle Outfitters beats profit view and issues healthy Q4 view on gross margin

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American Eagle Outfitters Inc.
AEO,
+0.62%
stock is up 7.7% in premarket trades after the retailer beat Wall Street estimates for third-quarter revenue and net income, while posting an operating profit of $118 million that exceeded pre-pandemic 2019 levels. The Pittsburgh-based company said its third-quarter net income fell to $81.27 million, or 42 cents a share, from $152.2 million, or 74 cents a share, in the year-ago quarter. The retailer’s latest profit includes includes a $1 million addback to net income of interest expense associated with the company’s convertible notes. Third-quarter revenue edged down to $1.24 billion from $1.27 billion. Wall Street analysts expected American Eagle to earn 22 cents a share on revenue of $1.21 billion, according to FactSet data. For the fourth quarter, American Eagle Outfitter expects fourth-quarter gross margin in the range of 32% to 33%, at the higher end of its previous estimates.

Credit: marketwatch.com

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