American Eagle on track for $1 billion Q1

Sales are booming across American Eagle Outfitters’ two banners. 

The apparel retailer said that its first-quarter business is exceeding expectations, with the economic stimulus, renewed consumer optimism and pent-up demand helping to fuel sales. Revenue is on track to top $1 billion for the quarter (end May 26). 

American Eagle said that demand has accelerated across both its namesake and Aerie brands, generating strong margins, higher full-priced selling and reduced promotions.  

“I’m amazed by the incredible momentum of Aerie, which is consistently reaching new heights and exceeding our expectations,” said Jay Schottenstein, executive chairman and CEO. “We are seeing great progress at American Eagle, with stronger merchandise, marketing and inventory management clearly demonstrating the power and true potential of our leading brand. Looking forward, I have never been more optimistic about our future than I am today.”

American Eagle’s denim business has been particularly strong, and shoppers have also started buying more tops, Schottenstein said during a phone interview with CNBC.

“There’s a lot of money out there,” he said. “We think the environment for the next few years, it’s going to be a very good environment. ... People will want to spend [and] people are going to want to go out and they’re going to want to get back to what was normal before.”

For the quarter, management expects operating income of approximately $120 million, compared to first quarter 2019 operating income of $48 million and adjusted operating income of $49 million.

American Eagle will report its first-quarter results on May 26.