American Eagle Outfitters (AEO) AEO Q2 Financial Results Summary

# American Eagle Outfitters, Inc. (AEO) Q2 2025 Financial Results Summary

On September 3, 2025, American Eagle Outfitters, Inc. (NYSE: AEO) announced its financial results for the second quarter ended August 2, 2025. The summary of the results is as follows:

## Financial Highlights

– **Total Net Revenue**: $1.28 billion, down **1%** compared to the same quarter last year.
– **Comparable Sales**: Decreased by **1%** overall.
– Aerie comparable sales grew **3%**.
– American Eagle comparable sales decreased by **3%**.
– **Gross Profit**: $500 million, with a gross margin of **38.9%**, which expanded by **30 basis points** year-over-year.
– **Merchandise Margins**: Increased by **50 basis points**, attributed to lower markdowns.

## Expenses

– **Buying, Occupancy, and Warehousing (BOW) Expenses**: Flat compared to last year, with a deleverage of **20 basis points**.
– **Selling, General, and Administrative (SG&A) Expenses**: Total of $342 million, down **1%**, consistent with the prior year’s percentage of sales.
– Lower compensation costs due to recent restructuring were noted, despite marketing investments.

## Operating Income

– **Operating Income**: $103 million, an increase of **2%** from the previous year.
– **Operating Margin**: Expanded by **20 basis points** to **8.0%**.
– **Diluted Earnings Per Share (EPS)**: $0.45, reflecting a **15%** increase year-over-year.
– **Average Diluted Shares Outstanding**: 172 million.

## Inventory Management

– **Ending Inventory**: Increased by **8%** to $718 million, with units up **3%**.
– The inventory cost increase was primarily due to tariffs.

## Shareholder Returns

– **Share Repurchases**: Year-to-date total of $231 million, resulting in a reduction of approximately **20 million shares**, or **10%** of outstanding diluted shares.
– **Quarterly Dividend**: $21 million paid via a cash dividend of **$0.125 per share**, accumulating to $43 million year-to-date.

## Capital Expenditures

– **Capital Expenditures**: Totaled $71 million in the second quarter, with a year-to-date total of $133 million.
– The company maintains its 2025 expectation for capital expenditures at approximately **$275 million**.

## Full-Year Guidance

– **Operating Income Guidance**: Expected between **$255 million and $265 million**.
– Outlook for the remainder of 2025:
– **Third Quarter**:
– Comparable Sales: Up **Low Single Digit**.
– Gross Margin: Expected to be down year-over-year.
– SG&A: Dollars expected to be up **High Single Digit**.
– Operating Income: Estimated between **$95 million and $100 million**.
– **Fourth Quarter**:
– Comparable Sales: Up **Low Single Digit**.
– Gross Margin: Expected down year-over-year.
– SG&A: Dollars expected to be flat to down slightly year-over-year.
– Operating Income: Estimated between **$125 million and $130 million**.

## Financial Statements Overview

– **Net Income**: For the quarter was $77.6 million, showing a marginal increase compared to $77.3 million in the same period last year.
– **Historical Comparisons**:
– Total revenue for the 26 weeks ended August 2, 2025 was $2.37 billion, down **2.5%** from $2.43 billion a year ago.

The company continues to adapt to changes in consumer demand, improve inventory alignment, and effectively manage expenses with strategic marketing efforts. As American Eagle Outfitters moves into the next quarter, it aims to leverage customer engagement and brand strength in pursuit of profitability and growth.

Here are the extracted tables from the press release:

### CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands)

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### CONSOLIDATED BALANCE SHEETS
(In thousands)