American Eagle Outfitters Inc. (NYSE:AEO) shares jumped over 7% on Monday morning after the apparel brand raised its fourth-quarter revenue guidance due to record holiday sales.
In an update, the specialty retailer said sales through December 30, 2023, were up 8%, with its American Eagle tracking up high single digits and its Aerie sub-brand up in the low teens.
Revenue for the quarter is now likely to be up in the low double digits from the prior year, including the positive contribution from a 53rd week. Operating profit is expected to amount to roughly $130 million, up from previous guidance of $105 million to $115 million, as it also benefited from strong merchandise margins.
“This holiday season we executed with confidence and precision, delivering winning product assortments and an exciting customer experience, which showcased the strength of our brands and operations,” commented. American Eagle executive chairman and CEO Jay Schottenstein.
“As we build on our strategic priorities, I am incredibly pleased with the momentum we are seeing across brands, which has continued into early January."
Looking ahead to 2024, the company said it remains confident in its ability to deliver healthy earnings growth and operating rate improvement as it maintains inventory and promotional discipline, prioritizes expense control and benefits from ongoing work on our profit improvement initiative.
Its shares traded 7.5% up at $21.33 by midday in New York.