American retailer AEO's net revenue at $5 bn in FY22

Aerie brand’s revenue in FY22 saw a 9 per cent increase from FY21 to reach $1.5 billion, on top of 39 per cent growth last year. In contrast, American Eagle brand’s revenue declined by 8 per cent to reach $3.3 billion, following a 30 per cent increase last year. Compared to pre-pandemic levels in FY19, Aerie’s revenue increased by 88 per cent, while American Eagle’s revenue declined 6 per cent.

The consolidated store revenue declined by 2 per cent, while total digital revenue declined 7 per cent, the company said in a press release.

In FY22, selling, general and administrative expense increased by 100 basis points as a rate to sales compared to FY21.

GAAP operating income in FY22 was $247 million, while non-GAAP operating income of $269 million reflected a 5.4 per cent operating margin. Furthermore, the GAAP earnings per share (EPS) was $0.64, while the non-GAAP EPS was $0.97.

In the fourth quarter (Q4) of FY22, AEO’s total net revenue was $1.5 billion, down 1 per cent compared to Q4 FY21. Gross profit was $507 million, an increase of approximately 4 per cent compared to $489 million in Q4 FY21. Gross margin rate was 33.9 per cent compared to 32.4 per cent in Q4 FY21.

The consolidated store revenue in Q4 FY22 declined by 2 per cent year-on-year (YoY). Total digital revenue declined by 7 per cent YoY.

Aerie brand’s revenue was $464 million in Q4 FY22, up 8 per cent versus Q4 FY21. Comp sales of Aerie declined 2 per cent versus the fourth quarter of FY21. American Eagle brand’s revenue was $962 million in Q4 FY22, a decline of 8 per cent versus Q4 FY21. Comp sales of American Eagle declined 9 per cent versus Q4 FY21.

For Q1 FY23, AEO expects revenue in the range of flat to up low-single digits with operating income approximately flat to last year.

For FY23, the company’s outlook reflects revenue in the range of flat to up low-single digits while the operating income is expected to be in the range of $270 to $310 million, compared to adjusted operating income of $269 million in FY22.

“Looking ahead, I am encouraged by several positives. Our inventory levels are healthy. The global supply chain has stabilised, restoring agility to our operations with a more normalised cost environment. Our brands are poised to deliver innovation and quality to our customers and to benefit from emerging fashion trends. Yet, our visibility into the macro remains limited, and we are taking a cautious view on 2023. We will stay disciplined, maintain sharp control over expenses, and seek ongoing efficiencies to drive shareholder returns,” said Jay Schottenstein, AEO’s executive chairman of the board and chief executive officer.

Fibre2Fashion News Desk (DP)