Abercrombie swings to Q2 profit; digital sales a bright spot
Despite falling net sales, Abercrombie & Fitch had some good news in Q2 fiscal 2020.
The specialty apparel retailer reported net sales of $698 million, down 17% year-over-year from $841 million. Abercrombie cited the adverse impact of COVID-19 on store sales.
However, digital net sales increased 56% to $386 million, reflecting robust growth in every month of the quarter. In addition, the retailer swung to net income of $5.46 million from a net loss of $31.1 million, aided by factors including lower promotional and clearance activity and tight cost management. Abercrombie did not provide same-store sales metrics.
[Further Reading: Abercrombie & Fitch enters resale market]
“We are listening, learning and evolving, and staying nimble in this unprecedented period of turmoil and uncertainty,” said Fran Horowitz, CEO, Abercrombie & Fitch. “Since the start of the pandemic, our global teams have been tirelessly at work, rapidly pivoting in response to the changing environment due to COVID-19 and calls for social justice. We have made many difficult decisions with a purpose of strengthening our company for near-term success and long-term growth. We will continue to be vigilant, thoughtfully managing operations while leveraging our strong liquidity position to strategically invest in critical functions that support our future global growth opportunities.”
For Q3 fiscal 2020, Abercrombie expects net sales to be down in the range of 15% to 20% as compared to last year. The company is not providing additional details for the third quarter or full year of fiscal 2020.
Abercrombie operates a total of 639 stores in the U.S. and 211 stores internationally under the Abercrombie and Hollister banners.