A client enters an American Eagle store in Miami, Florida, on April 4, 2025.
Joe Raedle | Getty images
American eagle On Tuesday, he said that he is canceling $ 75 million in spring and summer goods and withdrawing his guide from all over the year, since he holds with slow sales, steep discounts and an uncertain economy.
The clothing retailer said he expects income in the first quarter, which ended in early May, of around $ 1.1 billion, a decrease of approximately 5% compared to the previous period. American Eagle anticipates that comparable sales will fall by 3%, led by an expected 4% decrease in intimates Brand Aerie. American Eagle previously expected the sales of the first quarter to be reduced in a single digit percentage and early sales throughout the year would fall into a low percentage of a single digit.
The actions fell more than 17% in the extended trade.
When he reported fiscal results of the fourth quarter in March, American Eagle warned that the first quarter was at a “slower than expected” start, due to the weak demand and cold climate. The conditions evidently worsened as the quarter progressed, and the retailer resorted to the low discounts to move the inventory.
As a result, American Eagle expects to see an operational loss of around $ 85 million and an adjusted operational loss, which reduces the unique charges related to its restructuring, of approximately $ 68 million for the quarter. This loss reflects “higher than planned” discount and an inventory charge of $ 75 million related to a reduction in spring and summer merchandise, the company said.
“We are clearly disappointed with our execution in the first quarter. The marketing strategies did not promote the results we anticipate, which leads to higher promotions and an excess of inventory. As a result, we have made an inventory that we write about spring and summer goods,” said CEO Jay Schottenstein.
“We have entered the second quarter in a better position, with a more aligned inventory with sales trends,” he said. “In addition, we are actively evaluating our forward plans. Our teams continue to work with urgency to strengthen product performance, while improving our purchase principles.”
The company added that it is withdrawing its tax guide 2025 “due to macro uncertainty already measure that management reviews plans in the context of the results of the first quarter.” It is not clear if the recent changes in tariff policy had an effect on American Eagle.
Some companies bought inventory earlier than usual to plan higher duties, but American Eagle repeatedly said in March that it was in a solid inventory position and could pursue trends as the client preferences changed.
At the beginning of the first quarter, the company said it had some inventory interruptions and needed to complement the stock in some key categories, particularly in Aerie, one of its main growth drivers.
