Abercrombie & Fitch reported its first comparable sales growth in about a year, with Abercrombie brand comps up 4% and brand sales rising 8% to $596.8 million, sending shares up 36% on August 26, their biggest one-day gain since November 2025. The company's fiscal second-quarter results beat expectations, and management raised full-year earnings guidance to $13.10-$13.60, with third-quarter sales growth forecast at 5%-6%. However, the quarter's operating margin of nearly 20% included a one-time $100 million IEEPA tariff refund that contributed 790 basis points, and Hollister's comparable sales fell in the low single digits. Morgan Stanley raised its price target to $134 from $87 but kept an Equal-weight rating, noting that while the third quarter looks favorable, the fourth quarter remains the real test of whether the comeback is sustainable.
Abercrombie & Fitch CompanyQ2 beat, raised guidance, and shares surged 36%
Morgan Stanley