American Eagle Outfitters lifts full-year outlook after Q3 revenue rise

AEO +15.75%

American Eagle Outfitters (AEO) has raised guidance for the fourth quarter (Q4) of fiscal year 2025 (FY25) following better-than-expected Q3 results.

The company’s total net revenue for the quarter ended 1 November 2025 grew 6% year over year (YoY) to $1.36bn.

Total comparable sales increased 4%, with performance varying across brands.

American Eagle Outfitters operates the American Eagle, Aerie, OFFL/NE by Aerie, Todd Snyder and Unsubscribed brands in the US, Canada and Mexico.

Aerie posted an 11% increase in comparable sales, while comparable sales at American Eagle were up 1%.

Gross profit grew by 5% to $552m. Gross margin slipped by 40 basis points to 40.5%, which the company attributed to a $20m net tariff impact and higher markdowns.

These pressures were partially offset by lower freight costs and benefits from sales leverage. Buying, occupancy and warehousing expenses improved by 20 basis points.

Operating profit reached $113m, compared with $106m in the same period last year.

Other income totalled $14m, which included a previously disclosed unrealised investment gain of $13m.

Diluted earnings per share came in at $0.53, an increase of 29% YoY. Adjusted diluted earnings per share rose 10%, based on 173 million diluted shares.

Ending inventory stood at $891m, up 11%, with units increasing 8%.

Year to date, AEO has completed $231m in share repurchases, all executed in the first half of the fiscal year.

In Q3, the company returned $21m to shareholders through its $0.125 quarterly dividend, bringing total dividend payments so far this year to $64m.

Full-year capital expenditure is projected to be approximately $275m.

On the back of improving sales trends, AEO has lifted its Q4 operating income forecast to $155m–$160m, assuming comparable sales growth of 8–9%.

The company has also raised its full-year adjusted operating income outlook to $303m–$308m, up from its prior range of $255m–$265m.

Despite the improved earnings guidance, AEO expects gross margin to decline YoY in both Q4 and the full fiscal year, citing an anticipated net tariff impact of approximately $50m in Q4 and $70m for FY25.

AEO executive chairman of the board and CEO Jay Schottenstein said: “I am extremely pleased with the significant trend change across our business reflecting decisive steps taken from merchandising to marketing to operations – all having a positive impact.”

"American Eagle Outfitters lifts full-year outlook after Q3 revenue rise " was originally created and published by Retail Insight Network, a GlobalData owned brand.

The information on this site has been included in good faith for general informational purposes only. It is not intended to amount to advice on which you should rely, and we give no representation, warranty or guarantee, whether express or implied as to its accuracy or completeness. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the content on our site.