Recent Quotes View Full List My Watchlist Create Watchlist Indicators DJI Nasdaq Composite SPX Gold Crude Oil Hydroworld Market Index Markets Stocks ETFs Tools Overview News Currencies International Treasuries AEO Delivers Third Quarter Results Ahead of Expectations with Meaningful Margin Improvement from First Half By: American Eagle Outfitters, Inc. via Business Wire November 22, 2022 at 08:00 AM EST Aerie achieves all-time high third quarter revenue and operating profit Actions to right size inventory and expenses fuel sequential profit improvement Operating profit of $118 million exceeded pre-pandemic 2019 levels Continuing to prioritize profit recovery and cash generation American Eagle Outfitters, Inc. (NYSE: AEO) today announced financial results for the third quarter ended October 29, 2022. “I’m pleased to deliver a third quarter that exceeded our expectations, with profit margins meaningfully improved from the first half of the year. Bold actions to rationalize inventory and reduce expenses are paying off. Our inventory is in good shape, up 8% to last year, with progress continuing into the fourth quarter. We are staying disciplined and focused on improving profitability and cash flow, while maintaining a healthy balance sheet,” commented Jay Schottenstein, AEO’s Executive Chairman of the Board and Chief Executive Officer. “As we navigate the current macro environment, we remain focused on our strategic initiatives — leading with innovation and judiciously investing in capabilities that will differentiate us in the long-run. Our organization is strong and I have tremendous confidence in the resilience of our brands. We are excited about upcoming merchandise collections and look forward to delivering an exceptional customer experience across brands and channels this holiday season,” Jay continued. Third Quarter 2022 Results: Total net revenue of $1.2 billion was down 3% to the third quarter of 2021. Our supply chain business, Quiet Platforms, contributed approximately 2 percentage points to revenue growth. Brand revenue declined 5%, better than the company’s expectation for a high single digit decline. Aerie revenue of $350 million rose 11% versus third quarter 2021, reflecting a 24% 3-year revenue CAGR. Comp sales declined 3% versus third quarter 2021 and was up 59% to third quarter 2019. American Eagle revenue of $838 million declined 11% versus third quarter 2021 reflecting a negative 1% 3-year revenue CAGR. Comp sales declined 10% versus third quarter 2021 and was flat to third quarter 2019. Consolidated store revenue declined 4%. Total digital revenue declined 5%. Compared to pre-pandemic third quarter 2019, store revenue increased 3% and digital revenue increased 35%. Gross profit of $480 million compared to $565 million in the third quarter of 2021 and reflected a gross margin rate of 38.7% compared to 44.3% last year. Higher markdowns and increased product costs drove approximately 400 basis points of the rate decline and Quiet Platforms had a 70 basis point impact as that business continues to scale. Rent and warehousing also deleveraged, partially offset by lower incentive compensation. Selling, general and administrative expense of $311 million decreased 1% due to lower incentive compensation. SG&A increased 50 basis points as a rate to sales versus third quarter 2021. Operating income of $118 million reflected a 9.5% margin. This included an approximately $10 million loss from Quiet Platforms. GAAP diluted EPS of $0.42 includes an approximately $1 million addback to net income of interest expense associated with the company’s convertible notes. GAAP average diluted shares outstanding were 196 million including 8 million shares of unrealized dilution associated with the company’s convertible notes Inventory Total ending inventory at cost increased 8% to $798 million compared to $740 million last year, with units up 7%. This reflects a meaningful improvement from last quarter’s increase of 36%, reflecting actions to bring receipts more in line with demand. Inventory is current for the holiday season. The company continues to expect fourth quarter ending inventory to be down to last year. Capital Expenditures Capital expenditures totaled $71 million in the third quarter and $199 million year-to-date. Management continues to expect full-year spend to approximate $250 million. Quiet Platforms The logistics subsidiary is providing significant operational efficiencies and needed capacity for our brands. The third party customer base is ramping up as other brands look to upgrade their supply chain operations and drive efficiencies across their business to better compete in the current retail environment. As we evaluate our plans for Quiet, we are exploring different options to support future growth. Shareholder Returns The quarterly cash dividend remains paused to support financial flexibility, while navigating the near-term macro environment. Year-to-date, the company has returned $265 million in cash to shareholders through dividends and share repurchases, reflecting its highest level of returns since 2015. Outlook For the fourth quarter, the company is guiding brand revenue down in the mid single digits, and expects brand comps to be consistent with the third quarter. The company is also guiding fourth quarter gross margin in the range of 32% to 33%, at the higher end of previous guidance. While significant progress has been made in right-sizing inventory, management is taking a cautious view given what is likely to be a highly promotional Holiday season. Management continues to drive expense reductions across store payroll, corporate expense, professional services and advertising. The company remains on track to deliver $100 million in reductions to the original plan and expects SG&A dollars in the fourth quarter to be approximately flat to last year. Conference Call and Supplemental Financial Information Management will host a conference call and real time webcast today at 11:00 a.m. Eastern Time. To listen to the call, dial 1-877-407-0789 or internationally dial 1-201-689-8562 or go to www.aeo-inc.com to access the webcast and audio replay. Additionally, a financial results presentation is posted on the company’s website. * * * * About American Eagle Outfitters, Inc. American Eagle Outfitters, Inc. (NYSE: AEO) is a leading global specialty retailer offering high-quality, on-trend clothing, accessories and personal care products at affordable prices under its American Eagle® and Aerie® brands. Our purpose is to show the world that there’s REAL power in the optimism of youth. The company operates stores in the United States, Canada, Mexico, Hong Kong and Japan, and ships to 81 countries worldwide through its websites. American Eagle and Aerie merchandise also is available at more than 260 international locations operated by licensees in 26 countries. In 2022, AEO released its first annual Building a Better World report, which outlines two decades of ESG achievements through the company’s Planet, People and Practices initiatives. For more information, please visit www.aeo-inc.com. SAFE HARBOR STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995 This release and related statements by management contain forward-looking statements (as such term is defined in the Private Securities Litigation Reform Act of 1995), which represent our expectations or beliefs concerning future events, including fourth quarter and annual fiscal 2022 results. All forward-looking statements made by the company involve material risks and uncertainties and are subject to change based on many important factors, some of which may be beyond the company’s control. Words such as "estimate," "project," "plan," "believe," "expect," "anticipate," "intend," “potential,” and similar expressions may identify forward-looking statements. Except as may be required by applicable law, we undertake no obligation to publicly update or revise any forward-looking statements whether as a result of new information, future events or otherwise and even if experience or future changes make it clear that any projected results expressed or implied therein will not be realized. The following factors, in addition to the risks disclosed in Item 1A., Risk Factors, of our Annual Report on Form 10-K for the fiscal year ended January 29, 2022 and in any other filings that we may make with the Securities and Exchange Commission in some cases have affected, and in the future could affect, the company's financial performance and could cause actual results for fiscal 2022 and beyond to differ materially from those expressed or implied in any of the forward-looking statements included in this release or otherwise made by management: the negative impacts of the COVID-19 pandemic and related operational disruptions; the risk that the company’s operating, financial and capital plans may not be achieved; our inability to anticipate customer demand and changing fashion trends and to manage our inventory commensurately; seasonality of our business; our inability to achieve planned store financial performance; our inability to react to raw material cost, labor and energy cost increases; our inability to gain market share in the face of declining shopping center traffic; our inability to respond to changes in e-commerce and leverage omni-channel demands; our inability to expand internationally; difficulty with our international merchandise sourcing strategies; challenges with information technology systems, including safeguarding against security breaches; and global economic, public health, social, political and financial conditions, and the resulting impact on consumer confidence and consumer spending, as well as other changes in consumer discretionary spending habits, which could have a material adverse effect on our business, results of operations and liquidity. AMERICAN EAGLE OUTFITTERS, INC. CONSOLIDATED BALANCE SHEETS (Dollars in thousands) (unaudited) October 29, 2022 January 29, 2022 October 30, 2021 Assets Current assets: Cash and cash equivalents $ 82,133 $ 434,770 $ 740,668 Merchandise inventory 797,731 553,458 739,808 Accounts receivable, net 250,879 286,683 228,461 Prepaid expenses and other 146,362 122,013 66,593 Total current assets 1,277,105 1,396,924 1,775,530 Operating lease right-of-use assets 1,148,832 1,193,021 1,148,108 Property and equipment, at cost, net of accumulated depreciation 789,809 728,272 665,408 Goodwill, net 271,209 271,416 16,389 Intangible assets, net 96,530 102,701 52,943 Non-current deferred income taxes 34,135 44,167 57,753 Other assets 54,857 50,142 33,884 Total assets $ 3,672,477 $ 3,786,643 $ 3,750,015 Liabilities and Stockholders' Equity Current liabilities: Accounts payable $ 188,448 $ 231,782 $ 314,561 Current portion of operating lease liabilities 332,160 311,005 299,693 Unredeemed gift cards and gift certificates 47,531 71,365 42,070 Accrued compensation and payroll taxes 36,436 141,817 123,588 Accrued income taxes and other 13,056 16,274 33,570 Other current liabilities and accrued expenses 67,799 70,628 56,090 Total current liabilities 685,430 842,871 869,572 Non-current liabilities: Non-current operating lease liabilities 1,089,710 1,154,481 1,123,681 Long-term debt, net 411,911 341,002 336,249 Other non-current liabilities 22,894 24,617 23,816 Total non-current liabilities 1,524,515 1,520,100 1,483,746 Commitments and contingencies - - - Stockholders' equity: Preferred stock - - - Common stock 2,496 2,496 2,496 Contributed capital 389,726 636,355 627,264 Accumulated other comprehensive loss (41,267 ) (40,845 ) (39,049 ) Retained earnings 2,080,852 2,203,772 2,185,393 Treasury stock (969,275 ) (1,378,106 ) (1,379,407 ) Total stockholders' equity 1,462,532 1,423,672 1,396,697 Total liabilities and stockholders' equity $ 3,672,477 $ 3,786,643 $ 3,750,015 Current ratio 1.86 1.66 2.04 AMERICAN EAGLE OUTFITTERS, INC. CONSOLIDATED STATEMENTS OF OPERATIONS (Dollars and shares in thousands, except per share amounts) (unaudited) GAAP Basis 13 Weeks Ended October 29, 2022 % of Revenue October 30, 2021 % of Revenue Total net revenue $ 1,240,583 100.0 % $ 1,274,078 100.0 % Cost of sales, including certain buying, occupancy andwarehousing expenses 760,810 61.3 % 709,554 55.7 % Gross profit 479,773 38.7 % 564,524 44.3 % Selling, general and administrative expenses 311,101 25.1 % 313,890 24.6 % Depreciation and amortization expense 51,124 4.1 % 40,947 3.2 % Operating income 117,548 9.5 % 209,687 16.5 % Interest expense, net 3,878 0.3 % 8,612 0.7 % Other expense (income), net 782 0.1 % (3,130 ) -0.2 % Income before income taxes 112,888 9.1 % 204,205 16.0 % Provision for income taxes 31,616 2.5 % 51,981 4.1 % Net income $ 81,272 6.6 % $ 152,224 11.9 % Net income per basic share $ 0.44 $ 0.91 Net income per diluted share $ 0.42 $ 0.74 Weighted average common shares outstanding - basic 186,305 167,637 Weighted average common shares outstanding - diluted 195,776 205,013 GAAP Basis 39 Weeks Ended October 29, 2022 % of Revenue October 30, 2021 % of Revenue Total net revenue $ 3,493,745 100.0 % $ 3,502,848 100.0 % Cost of sales, including certain buying, occupancy andwarehousing expenses 2,255,929 64.5 % 1,999,743 57.1 % Gross profit 1,237,816 35.5 % 1,503,105 42.9 % Selling, general and administrative expenses 917,687 26.3 % 872,320 24.9 % Depreciation and amortization expense 146,664 4.2 % 119,674 3.4 % Operating income 173,465 5.0 % 511,111 14.6 % Debt related charges 60,066 1.7 % - 0.0 % Interest expense, net 11,887 0.3 % 26,038 0.7 % Other income, net (5,501 ) -0.2 % (6,354 ) -0.2 % Income before income taxes 107,013 3.2 % 491,427 14.1 % Provision for income taxes 36,466 1.2 % 122,226 3.6 % Net income $ 70,547 2.0 % $ 369,201 10.5 % Net income per basic share $ 0.39 $ 2.20 Net income per diluted share $ 0.36 $ 1.78 Weighted average common shares outstanding - basic 178,637 168,062 Weighted average common shares outstanding - diluted 207,499 207,032 AMERICAN EAGLE OUTFITTERS, INC. BASIC AND DILUTED EARNINGS PER SHARE RECONCILIATION (Dollars and shares in thousands) (unaudited) 13 Weeks Ended 39 Weeks Ended Numerator: October 29, 2022 October 30, 2021 October 29, 2022 October 30, 2021 Net income and numerator for basic EPS $ 81,272 $ 152,224 $ 70,547 $ 369,201 Add: Interest expense, net of tax, related to the 2025 Notes (1) 529 - 4,897 - Numerator for diluted EPS $ 81,801 $ 152,224 $ 75,444 $ 369,201 Denominator: Denominator for basic EPS - weighted average shares 186,305 167,637 178,637 168,062 Add: Dilutive effect of the 2025 Notes (1) 8,418 33,687 27,280 34,616 Add: Dilutive effect of stock options and non-vested restricted stock 1,053 3,689 1,582 4,354 Denominator for diluted EPS - adjusted weighted average shares 195,776 205,013 207,499 207,032 (1) During the 39 weeks ended October 29, 2022, the Company adopted ASU 2020-06 under the modified retrospective method, which requires the Company to utilize the "if-converted" method of calculated diluted EPS. AMERICAN EAGLE OUTFITTERS, INC. GAAP TO NON-GAAP RECONCILIATION (Dollars in thousands, except per share amounts) (unaudited) 13 Weeks Ended October 30, 2021 Interest expense, net Net income Diluted earnings per common share GAAP Basis $ 8,612 $ 152,224 $ 0.74 % of Revenue 0.7 % 11.9 % Less: Convertible debt (1) 4,569 3,330 0.02 Non-GAAP Basis $ 4,043 $ 155,554 $ 0.76 % of Revenue 0.3 % 12.2 % (1) Amortization of the non-cash discount on the Company's convertible notes AMERICAN EAGLE OUTFITTERS, INC. RESULTS BY SEGMENT (Dollars in thousands) (unaudited) American Eagle Aerie Corporate and Other (1) Total 13 weeks ended October 29, 2022 Total net revenue $ 837,575 $ 349,712 $ 53,296 $ 1,240,583 Operating income (loss) $ 174,129 $ 56,487 $ (113,068 ) $ 117,548 % of revenue 20.8 % 16.2 % 9.5 % Capital expenditures $ 20,477 $ 24,404 $ 26,626 $ 71,507 13 weeks ended October 30, 2021 Total net revenue $ 940,992 $ 315,049 $ 18,037 $ 1,274,078 Operating income (loss) $ 261,225 $ 52,021 $ (103,559 ) $ 209,687 % of revenue 27.8 % 16.5 % 16.5 % Capital expenditures $ 13,298 $ 24,867 $ 20,036 $ 58,201 American Eagle Aerie Corporate and Other (1) Total 39 Weeks Ended October 29, 2022 Total net revenue $ 2,301,051 $ 1,043,129 $ 149,565 $ 3,493,745 Operating income (loss) $ 387,213 $ 111,414 $ (325,162 ) $ 173,465 % of revenue 16.8 % 10.7 % 5.0 % Capital expenditures $ 55,000 $ 85,663 $ 58,701 $ 199,364 39 Weeks Ended October 30, 2021 Total net revenue $ 2,513,700 $ 947,851 $ 41,297 $ 3,502,848 Operating income (loss) $ 611,650 $ 191,341 $ (291,880 ) $ 511,111 % of revenue 24.3 % 20.2 % 14.6 % Capital expenditures $ 36,093 $ 48,164 $ 60,148 $ 144,405 (1) Corporate and Other includes revenue and operating results of the Todd Snyder and Unsubscribed brands, and Quiet Platforms (net of intersegment eliminations), which have been identified as operating segments but are not material to disclose as separate reportable segments. Corporate operating costs represents certain costs that are not directly attributable to another reportable segment. AMERICAN EAGLE OUTFITTERS, INC. STORE INFORMATION (unaudited) Third Quarter YTD Third Quarter 2022 2022 Consolidated stores at beginning of period 1,160 1,133 Consolidated stores opened during the period AE Brand (2) 8 19 Aerie (incl. OFFL/NE) (3) 16 51 Todd Snyder - 1 Unsubscribed - 1 Consolidated stores closed during the period AE Brand (2) (5 ) (23 ) Aerie (incl. OFFL/NE) (3) - (3 ) Total consolidated stores at end of period 1,179 1,179 AE Brand (2) 876 Aerie (incl. OFFL/NE) (3) 292 Todd Snyder 6 Unsubscribed 5 Total gross square footage at end of period (in '000) 7,309 7,309 International license locations at end of period (1) 261 261 (1) International license locations (retail stores and concessions) are not included in the consolidated store data or the total gross square footage calculation. (2) AE Brand includes AE stand alone locations, AE/Aerie side-by side locations, AE/OFFL/NE side-by-side locations, and AE/Aerie/OFFL/NE side-by-side locations. (3) Aerie (incl. OFFL/NE) includes Aerie stand alone locations, OFFL/NE stand alone locations, and Aerie/OFFL/NE side-by-side locations. View source version on businesswire.com: https://www.businesswire.com/news/home/20221121005868/en/Contacts Olivia Messina 412-432-3300 LineMedia@ae.com Data & News supplied by www.cloudquote.io Stock quotes supplied by Barchart Quotes delayed at least 20 minutes. By accessing this page, you agree to the following Privacy Policy and Terms and Conditions.
AEO Delivers Third Quarter Results Ahead of Expectations with Meaningful Margin Improvement from First Half By: American Eagle Outfitters, Inc. via Business Wire November 22, 2022 at 08:00 AM EST Aerie achieves all-time high third quarter revenue and operating profit Actions to right size inventory and expenses fuel sequential profit improvement Operating profit of $118 million exceeded pre-pandemic 2019 levels Continuing to prioritize profit recovery and cash generation American Eagle Outfitters, Inc. (NYSE: AEO) today announced financial results for the third quarter ended October 29, 2022. “I’m pleased to deliver a third quarter that exceeded our expectations, with profit margins meaningfully improved from the first half of the year. Bold actions to rationalize inventory and reduce expenses are paying off. Our inventory is in good shape, up 8% to last year, with progress continuing into the fourth quarter. We are staying disciplined and focused on improving profitability and cash flow, while maintaining a healthy balance sheet,” commented Jay Schottenstein, AEO’s Executive Chairman of the Board and Chief Executive Officer. “As we navigate the current macro environment, we remain focused on our strategic initiatives — leading with innovation and judiciously investing in capabilities that will differentiate us in the long-run. Our organization is strong and I have tremendous confidence in the resilience of our brands. We are excited about upcoming merchandise collections and look forward to delivering an exceptional customer experience across brands and channels this holiday season,” Jay continued. Third Quarter 2022 Results: Total net revenue of $1.2 billion was down 3% to the third quarter of 2021. Our supply chain business, Quiet Platforms, contributed approximately 2 percentage points to revenue growth. Brand revenue declined 5%, better than the company’s expectation for a high single digit decline. Aerie revenue of $350 million rose 11% versus third quarter 2021, reflecting a 24% 3-year revenue CAGR. Comp sales declined 3% versus third quarter 2021 and was up 59% to third quarter 2019. American Eagle revenue of $838 million declined 11% versus third quarter 2021 reflecting a negative 1% 3-year revenue CAGR. Comp sales declined 10% versus third quarter 2021 and was flat to third quarter 2019. Consolidated store revenue declined 4%. Total digital revenue declined 5%. Compared to pre-pandemic third quarter 2019, store revenue increased 3% and digital revenue increased 35%. Gross profit of $480 million compared to $565 million in the third quarter of 2021 and reflected a gross margin rate of 38.7% compared to 44.3% last year. Higher markdowns and increased product costs drove approximately 400 basis points of the rate decline and Quiet Platforms had a 70 basis point impact as that business continues to scale. Rent and warehousing also deleveraged, partially offset by lower incentive compensation. Selling, general and administrative expense of $311 million decreased 1% due to lower incentive compensation. SG&A increased 50 basis points as a rate to sales versus third quarter 2021. Operating income of $118 million reflected a 9.5% margin. This included an approximately $10 million loss from Quiet Platforms. GAAP diluted EPS of $0.42 includes an approximately $1 million addback to net income of interest expense associated with the company’s convertible notes. GAAP average diluted shares outstanding were 196 million including 8 million shares of unrealized dilution associated with the company’s convertible notes Inventory Total ending inventory at cost increased 8% to $798 million compared to $740 million last year, with units up 7%. This reflects a meaningful improvement from last quarter’s increase of 36%, reflecting actions to bring receipts more in line with demand. Inventory is current for the holiday season. The company continues to expect fourth quarter ending inventory to be down to last year. Capital Expenditures Capital expenditures totaled $71 million in the third quarter and $199 million year-to-date. Management continues to expect full-year spend to approximate $250 million. Quiet Platforms The logistics subsidiary is providing significant operational efficiencies and needed capacity for our brands. The third party customer base is ramping up as other brands look to upgrade their supply chain operations and drive efficiencies across their business to better compete in the current retail environment. As we evaluate our plans for Quiet, we are exploring different options to support future growth. Shareholder Returns The quarterly cash dividend remains paused to support financial flexibility, while navigating the near-term macro environment. Year-to-date, the company has returned $265 million in cash to shareholders through dividends and share repurchases, reflecting its highest level of returns since 2015. Outlook For the fourth quarter, the company is guiding brand revenue down in the mid single digits, and expects brand comps to be consistent with the third quarter. The company is also guiding fourth quarter gross margin in the range of 32% to 33%, at the higher end of previous guidance. While significant progress has been made in right-sizing inventory, management is taking a cautious view given what is likely to be a highly promotional Holiday season. Management continues to drive expense reductions across store payroll, corporate expense, professional services and advertising. The company remains on track to deliver $100 million in reductions to the original plan and expects SG&A dollars in the fourth quarter to be approximately flat to last year. Conference Call and Supplemental Financial Information Management will host a conference call and real time webcast today at 11:00 a.m. Eastern Time. To listen to the call, dial 1-877-407-0789 or internationally dial 1-201-689-8562 or go to www.aeo-inc.com to access the webcast and audio replay. Additionally, a financial results presentation is posted on the company’s website. * * * * About American Eagle Outfitters, Inc. American Eagle Outfitters, Inc. (NYSE: AEO) is a leading global specialty retailer offering high-quality, on-trend clothing, accessories and personal care products at affordable prices under its American Eagle® and Aerie® brands. Our purpose is to show the world that there’s REAL power in the optimism of youth. The company operates stores in the United States, Canada, Mexico, Hong Kong and Japan, and ships to 81 countries worldwide through its websites. American Eagle and Aerie merchandise also is available at more than 260 international locations operated by licensees in 26 countries. In 2022, AEO released its first annual Building a Better World report, which outlines two decades of ESG achievements through the company’s Planet, People and Practices initiatives. For more information, please visit www.aeo-inc.com. SAFE HARBOR STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995 This release and related statements by management contain forward-looking statements (as such term is defined in the Private Securities Litigation Reform Act of 1995), which represent our expectations or beliefs concerning future events, including fourth quarter and annual fiscal 2022 results. All forward-looking statements made by the company involve material risks and uncertainties and are subject to change based on many important factors, some of which may be beyond the company’s control. Words such as "estimate," "project," "plan," "believe," "expect," "anticipate," "intend," “potential,” and similar expressions may identify forward-looking statements. Except as may be required by applicable law, we undertake no obligation to publicly update or revise any forward-looking statements whether as a result of new information, future events or otherwise and even if experience or future changes make it clear that any projected results expressed or implied therein will not be realized. The following factors, in addition to the risks disclosed in Item 1A., Risk Factors, of our Annual Report on Form 10-K for the fiscal year ended January 29, 2022 and in any other filings that we may make with the Securities and Exchange Commission in some cases have affected, and in the future could affect, the company's financial performance and could cause actual results for fiscal 2022 and beyond to differ materially from those expressed or implied in any of the forward-looking statements included in this release or otherwise made by management: the negative impacts of the COVID-19 pandemic and related operational disruptions; the risk that the company’s operating, financial and capital plans may not be achieved; our inability to anticipate customer demand and changing fashion trends and to manage our inventory commensurately; seasonality of our business; our inability to achieve planned store financial performance; our inability to react to raw material cost, labor and energy cost increases; our inability to gain market share in the face of declining shopping center traffic; our inability to respond to changes in e-commerce and leverage omni-channel demands; our inability to expand internationally; difficulty with our international merchandise sourcing strategies; challenges with information technology systems, including safeguarding against security breaches; and global economic, public health, social, political and financial conditions, and the resulting impact on consumer confidence and consumer spending, as well as other changes in consumer discretionary spending habits, which could have a material adverse effect on our business, results of operations and liquidity. AMERICAN EAGLE OUTFITTERS, INC. CONSOLIDATED BALANCE SHEETS (Dollars in thousands) (unaudited) October 29, 2022 January 29, 2022 October 30, 2021 Assets Current assets: Cash and cash equivalents $ 82,133 $ 434,770 $ 740,668 Merchandise inventory 797,731 553,458 739,808 Accounts receivable, net 250,879 286,683 228,461 Prepaid expenses and other 146,362 122,013 66,593 Total current assets 1,277,105 1,396,924 1,775,530 Operating lease right-of-use assets 1,148,832 1,193,021 1,148,108 Property and equipment, at cost, net of accumulated depreciation 789,809 728,272 665,408 Goodwill, net 271,209 271,416 16,389 Intangible assets, net 96,530 102,701 52,943 Non-current deferred income taxes 34,135 44,167 57,753 Other assets 54,857 50,142 33,884 Total assets $ 3,672,477 $ 3,786,643 $ 3,750,015 Liabilities and Stockholders' Equity Current liabilities: Accounts payable $ 188,448 $ 231,782 $ 314,561 Current portion of operating lease liabilities 332,160 311,005 299,693 Unredeemed gift cards and gift certificates 47,531 71,365 42,070 Accrued compensation and payroll taxes 36,436 141,817 123,588 Accrued income taxes and other 13,056 16,274 33,570 Other current liabilities and accrued expenses 67,799 70,628 56,090 Total current liabilities 685,430 842,871 869,572 Non-current liabilities: Non-current operating lease liabilities 1,089,710 1,154,481 1,123,681 Long-term debt, net 411,911 341,002 336,249 Other non-current liabilities 22,894 24,617 23,816 Total non-current liabilities 1,524,515 1,520,100 1,483,746 Commitments and contingencies - - - Stockholders' equity: Preferred stock - - - Common stock 2,496 2,496 2,496 Contributed capital 389,726 636,355 627,264 Accumulated other comprehensive loss (41,267 ) (40,845 ) (39,049 ) Retained earnings 2,080,852 2,203,772 2,185,393 Treasury stock (969,275 ) (1,378,106 ) (1,379,407 ) Total stockholders' equity 1,462,532 1,423,672 1,396,697 Total liabilities and stockholders' equity $ 3,672,477 $ 3,786,643 $ 3,750,015 Current ratio 1.86 1.66 2.04 AMERICAN EAGLE OUTFITTERS, INC. CONSOLIDATED STATEMENTS OF OPERATIONS (Dollars and shares in thousands, except per share amounts) (unaudited) GAAP Basis 13 Weeks Ended October 29, 2022 % of Revenue October 30, 2021 % of Revenue Total net revenue $ 1,240,583 100.0 % $ 1,274,078 100.0 % Cost of sales, including certain buying, occupancy andwarehousing expenses 760,810 61.3 % 709,554 55.7 % Gross profit 479,773 38.7 % 564,524 44.3 % Selling, general and administrative expenses 311,101 25.1 % 313,890 24.6 % Depreciation and amortization expense 51,124 4.1 % 40,947 3.2 % Operating income 117,548 9.5 % 209,687 16.5 % Interest expense, net 3,878 0.3 % 8,612 0.7 % Other expense (income), net 782 0.1 % (3,130 ) -0.2 % Income before income taxes 112,888 9.1 % 204,205 16.0 % Provision for income taxes 31,616 2.5 % 51,981 4.1 % Net income $ 81,272 6.6 % $ 152,224 11.9 % Net income per basic share $ 0.44 $ 0.91 Net income per diluted share $ 0.42 $ 0.74 Weighted average common shares outstanding - basic 186,305 167,637 Weighted average common shares outstanding - diluted 195,776 205,013 GAAP Basis 39 Weeks Ended October 29, 2022 % of Revenue October 30, 2021 % of Revenue Total net revenue $ 3,493,745 100.0 % $ 3,502,848 100.0 % Cost of sales, including certain buying, occupancy andwarehousing expenses 2,255,929 64.5 % 1,999,743 57.1 % Gross profit 1,237,816 35.5 % 1,503,105 42.9 % Selling, general and administrative expenses 917,687 26.3 % 872,320 24.9 % Depreciation and amortization expense 146,664 4.2 % 119,674 3.4 % Operating income 173,465 5.0 % 511,111 14.6 % Debt related charges 60,066 1.7 % - 0.0 % Interest expense, net 11,887 0.3 % 26,038 0.7 % Other income, net (5,501 ) -0.2 % (6,354 ) -0.2 % Income before income taxes 107,013 3.2 % 491,427 14.1 % Provision for income taxes 36,466 1.2 % 122,226 3.6 % Net income $ 70,547 2.0 % $ 369,201 10.5 % Net income per basic share $ 0.39 $ 2.20 Net income per diluted share $ 0.36 $ 1.78 Weighted average common shares outstanding - basic 178,637 168,062 Weighted average common shares outstanding - diluted 207,499 207,032 AMERICAN EAGLE OUTFITTERS, INC. BASIC AND DILUTED EARNINGS PER SHARE RECONCILIATION (Dollars and shares in thousands) (unaudited) 13 Weeks Ended 39 Weeks Ended Numerator: October 29, 2022 October 30, 2021 October 29, 2022 October 30, 2021 Net income and numerator for basic EPS $ 81,272 $ 152,224 $ 70,547 $ 369,201 Add: Interest expense, net of tax, related to the 2025 Notes (1) 529 - 4,897 - Numerator for diluted EPS $ 81,801 $ 152,224 $ 75,444 $ 369,201 Denominator: Denominator for basic EPS - weighted average shares 186,305 167,637 178,637 168,062 Add: Dilutive effect of the 2025 Notes (1) 8,418 33,687 27,280 34,616 Add: Dilutive effect of stock options and non-vested restricted stock 1,053 3,689 1,582 4,354 Denominator for diluted EPS - adjusted weighted average shares 195,776 205,013 207,499 207,032 (1) During the 39 weeks ended October 29, 2022, the Company adopted ASU 2020-06 under the modified retrospective method, which requires the Company to utilize the "if-converted" method of calculated diluted EPS. AMERICAN EAGLE OUTFITTERS, INC. GAAP TO NON-GAAP RECONCILIATION (Dollars in thousands, except per share amounts) (unaudited) 13 Weeks Ended October 30, 2021 Interest expense, net Net income Diluted earnings per common share GAAP Basis $ 8,612 $ 152,224 $ 0.74 % of Revenue 0.7 % 11.9 % Less: Convertible debt (1) 4,569 3,330 0.02 Non-GAAP Basis $ 4,043 $ 155,554 $ 0.76 % of Revenue 0.3 % 12.2 % (1) Amortization of the non-cash discount on the Company's convertible notes AMERICAN EAGLE OUTFITTERS, INC. RESULTS BY SEGMENT (Dollars in thousands) (unaudited) American Eagle Aerie Corporate and Other (1) Total 13 weeks ended October 29, 2022 Total net revenue $ 837,575 $ 349,712 $ 53,296 $ 1,240,583 Operating income (loss) $ 174,129 $ 56,487 $ (113,068 ) $ 117,548 % of revenue 20.8 % 16.2 % 9.5 % Capital expenditures $ 20,477 $ 24,404 $ 26,626 $ 71,507 13 weeks ended October 30, 2021 Total net revenue $ 940,992 $ 315,049 $ 18,037 $ 1,274,078 Operating income (loss) $ 261,225 $ 52,021 $ (103,559 ) $ 209,687 % of revenue 27.8 % 16.5 % 16.5 % Capital expenditures $ 13,298 $ 24,867 $ 20,036 $ 58,201 American Eagle Aerie Corporate and Other (1) Total 39 Weeks Ended October 29, 2022 Total net revenue $ 2,301,051 $ 1,043,129 $ 149,565 $ 3,493,745 Operating income (loss) $ 387,213 $ 111,414 $ (325,162 ) $ 173,465 % of revenue 16.8 % 10.7 % 5.0 % Capital expenditures $ 55,000 $ 85,663 $ 58,701 $ 199,364 39 Weeks Ended October 30, 2021 Total net revenue $ 2,513,700 $ 947,851 $ 41,297 $ 3,502,848 Operating income (loss) $ 611,650 $ 191,341 $ (291,880 ) $ 511,111 % of revenue 24.3 % 20.2 % 14.6 % Capital expenditures $ 36,093 $ 48,164 $ 60,148 $ 144,405 (1) Corporate and Other includes revenue and operating results of the Todd Snyder and Unsubscribed brands, and Quiet Platforms (net of intersegment eliminations), which have been identified as operating segments but are not material to disclose as separate reportable segments. Corporate operating costs represents certain costs that are not directly attributable to another reportable segment. AMERICAN EAGLE OUTFITTERS, INC. STORE INFORMATION (unaudited) Third Quarter YTD Third Quarter 2022 2022 Consolidated stores at beginning of period 1,160 1,133 Consolidated stores opened during the period AE Brand (2) 8 19 Aerie (incl. OFFL/NE) (3) 16 51 Todd Snyder - 1 Unsubscribed - 1 Consolidated stores closed during the period AE Brand (2) (5 ) (23 ) Aerie (incl. OFFL/NE) (3) - (3 ) Total consolidated stores at end of period 1,179 1,179 AE Brand (2) 876 Aerie (incl. OFFL/NE) (3) 292 Todd Snyder 6 Unsubscribed 5 Total gross square footage at end of period (in '000) 7,309 7,309 International license locations at end of period (1) 261 261 (1) International license locations (retail stores and concessions) are not included in the consolidated store data or the total gross square footage calculation. (2) AE Brand includes AE stand alone locations, AE/Aerie side-by side locations, AE/OFFL/NE side-by-side locations, and AE/Aerie/OFFL/NE side-by-side locations. (3) Aerie (incl. OFFL/NE) includes Aerie stand alone locations, OFFL/NE stand alone locations, and Aerie/OFFL/NE side-by-side locations. View source version on businesswire.com: https://www.businesswire.com/news/home/20221121005868/en/Contacts Olivia Messina 412-432-3300 LineMedia@ae.com
Aerie achieves all-time high third quarter revenue and operating profit Actions to right size inventory and expenses fuel sequential profit improvement Operating profit of $118 million exceeded pre-pandemic 2019 levels Continuing to prioritize profit recovery and cash generation
American Eagle Outfitters, Inc. (NYSE: AEO) today announced financial results for the third quarter ended October 29, 2022. “I’m pleased to deliver a third quarter that exceeded our expectations, with profit margins meaningfully improved from the first half of the year. Bold actions to rationalize inventory and reduce expenses are paying off. Our inventory is in good shape, up 8% to last year, with progress continuing into the fourth quarter. We are staying disciplined and focused on improving profitability and cash flow, while maintaining a healthy balance sheet,” commented Jay Schottenstein, AEO’s Executive Chairman of the Board and Chief Executive Officer. “As we navigate the current macro environment, we remain focused on our strategic initiatives — leading with innovation and judiciously investing in capabilities that will differentiate us in the long-run. Our organization is strong and I have tremendous confidence in the resilience of our brands. We are excited about upcoming merchandise collections and look forward to delivering an exceptional customer experience across brands and channels this holiday season,” Jay continued. Third Quarter 2022 Results: Total net revenue of $1.2 billion was down 3% to the third quarter of 2021. Our supply chain business, Quiet Platforms, contributed approximately 2 percentage points to revenue growth. Brand revenue declined 5%, better than the company’s expectation for a high single digit decline. Aerie revenue of $350 million rose 11% versus third quarter 2021, reflecting a 24% 3-year revenue CAGR. Comp sales declined 3% versus third quarter 2021 and was up 59% to third quarter 2019. American Eagle revenue of $838 million declined 11% versus third quarter 2021 reflecting a negative 1% 3-year revenue CAGR. Comp sales declined 10% versus third quarter 2021 and was flat to third quarter 2019. Consolidated store revenue declined 4%. Total digital revenue declined 5%. Compared to pre-pandemic third quarter 2019, store revenue increased 3% and digital revenue increased 35%. Gross profit of $480 million compared to $565 million in the third quarter of 2021 and reflected a gross margin rate of 38.7% compared to 44.3% last year. Higher markdowns and increased product costs drove approximately 400 basis points of the rate decline and Quiet Platforms had a 70 basis point impact as that business continues to scale. Rent and warehousing also deleveraged, partially offset by lower incentive compensation. Selling, general and administrative expense of $311 million decreased 1% due to lower incentive compensation. SG&A increased 50 basis points as a rate to sales versus third quarter 2021. Operating income of $118 million reflected a 9.5% margin. This included an approximately $10 million loss from Quiet Platforms. GAAP diluted EPS of $0.42 includes an approximately $1 million addback to net income of interest expense associated with the company’s convertible notes. GAAP average diluted shares outstanding were 196 million including 8 million shares of unrealized dilution associated with the company’s convertible notes Inventory Total ending inventory at cost increased 8% to $798 million compared to $740 million last year, with units up 7%. This reflects a meaningful improvement from last quarter’s increase of 36%, reflecting actions to bring receipts more in line with demand. Inventory is current for the holiday season. The company continues to expect fourth quarter ending inventory to be down to last year. Capital Expenditures Capital expenditures totaled $71 million in the third quarter and $199 million year-to-date. Management continues to expect full-year spend to approximate $250 million. Quiet Platforms The logistics subsidiary is providing significant operational efficiencies and needed capacity for our brands. The third party customer base is ramping up as other brands look to upgrade their supply chain operations and drive efficiencies across their business to better compete in the current retail environment. As we evaluate our plans for Quiet, we are exploring different options to support future growth. Shareholder Returns The quarterly cash dividend remains paused to support financial flexibility, while navigating the near-term macro environment. Year-to-date, the company has returned $265 million in cash to shareholders through dividends and share repurchases, reflecting its highest level of returns since 2015. Outlook For the fourth quarter, the company is guiding brand revenue down in the mid single digits, and expects brand comps to be consistent with the third quarter. The company is also guiding fourth quarter gross margin in the range of 32% to 33%, at the higher end of previous guidance. While significant progress has been made in right-sizing inventory, management is taking a cautious view given what is likely to be a highly promotional Holiday season. Management continues to drive expense reductions across store payroll, corporate expense, professional services and advertising. The company remains on track to deliver $100 million in reductions to the original plan and expects SG&A dollars in the fourth quarter to be approximately flat to last year. Conference Call and Supplemental Financial Information Management will host a conference call and real time webcast today at 11:00 a.m. Eastern Time. To listen to the call, dial 1-877-407-0789 or internationally dial 1-201-689-8562 or go to www.aeo-inc.com to access the webcast and audio replay. Additionally, a financial results presentation is posted on the company’s website. * * * * About American Eagle Outfitters, Inc. American Eagle Outfitters, Inc. (NYSE: AEO) is a leading global specialty retailer offering high-quality, on-trend clothing, accessories and personal care products at affordable prices under its American Eagle® and Aerie® brands. Our purpose is to show the world that there’s REAL power in the optimism of youth. The company operates stores in the United States, Canada, Mexico, Hong Kong and Japan, and ships to 81 countries worldwide through its websites. American Eagle and Aerie merchandise also is available at more than 260 international locations operated by licensees in 26 countries. In 2022, AEO released its first annual Building a Better World report, which outlines two decades of ESG achievements through the company’s Planet, People and Practices initiatives. For more information, please visit www.aeo-inc.com. SAFE HARBOR STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995 This release and related statements by management contain forward-looking statements (as such term is defined in the Private Securities Litigation Reform Act of 1995), which represent our expectations or beliefs concerning future events, including fourth quarter and annual fiscal 2022 results. All forward-looking statements made by the company involve material risks and uncertainties and are subject to change based on many important factors, some of which may be beyond the company’s control. Words such as "estimate," "project," "plan," "believe," "expect," "anticipate," "intend," “potential,” and similar expressions may identify forward-looking statements. Except as may be required by applicable law, we undertake no obligation to publicly update or revise any forward-looking statements whether as a result of new information, future events or otherwise and even if experience or future changes make it clear that any projected results expressed or implied therein will not be realized. The following factors, in addition to the risks disclosed in Item 1A., Risk Factors, of our Annual Report on Form 10-K for the fiscal year ended January 29, 2022 and in any other filings that we may make with the Securities and Exchange Commission in some cases have affected, and in the future could affect, the company's financial performance and could cause actual results for fiscal 2022 and beyond to differ materially from those expressed or implied in any of the forward-looking statements included in this release or otherwise made by management: the negative impacts of the COVID-19 pandemic and related operational disruptions; the risk that the company’s operating, financial and capital plans may not be achieved; our inability to anticipate customer demand and changing fashion trends and to manage our inventory commensurately; seasonality of our business; our inability to achieve planned store financial performance; our inability to react to raw material cost, labor and energy cost increases; our inability to gain market share in the face of declining shopping center traffic; our inability to respond to changes in e-commerce and leverage omni-channel demands; our inability to expand internationally; difficulty with our international merchandise sourcing strategies; challenges with information technology systems, including safeguarding against security breaches; and global economic, public health, social, political and financial conditions, and the resulting impact on consumer confidence and consumer spending, as well as other changes in consumer discretionary spending habits, which could have a material adverse effect on our business, results of operations and liquidity. AMERICAN EAGLE OUTFITTERS, INC. CONSOLIDATED BALANCE SHEETS (Dollars in thousands) (unaudited) October 29, 2022 January 29, 2022 October 30, 2021 Assets Current assets: Cash and cash equivalents $ 82,133 $ 434,770 $ 740,668 Merchandise inventory 797,731 553,458 739,808 Accounts receivable, net 250,879 286,683 228,461 Prepaid expenses and other 146,362 122,013 66,593 Total current assets 1,277,105 1,396,924 1,775,530 Operating lease right-of-use assets 1,148,832 1,193,021 1,148,108 Property and equipment, at cost, net of accumulated depreciation 789,809 728,272 665,408 Goodwill, net 271,209 271,416 16,389 Intangible assets, net 96,530 102,701 52,943 Non-current deferred income taxes 34,135 44,167 57,753 Other assets 54,857 50,142 33,884 Total assets $ 3,672,477 $ 3,786,643 $ 3,750,015 Liabilities and Stockholders' Equity Current liabilities: Accounts payable $ 188,448 $ 231,782 $ 314,561 Current portion of operating lease liabilities 332,160 311,005 299,693 Unredeemed gift cards and gift certificates 47,531 71,365 42,070 Accrued compensation and payroll taxes 36,436 141,817 123,588 Accrued income taxes and other 13,056 16,274 33,570 Other current liabilities and accrued expenses 67,799 70,628 56,090 Total current liabilities 685,430 842,871 869,572 Non-current liabilities: Non-current operating lease liabilities 1,089,710 1,154,481 1,123,681 Long-term debt, net 411,911 341,002 336,249 Other non-current liabilities 22,894 24,617 23,816 Total non-current liabilities 1,524,515 1,520,100 1,483,746 Commitments and contingencies - - - Stockholders' equity: Preferred stock - - - Common stock 2,496 2,496 2,496 Contributed capital 389,726 636,355 627,264 Accumulated other comprehensive loss (41,267 ) (40,845 ) (39,049 ) Retained earnings 2,080,852 2,203,772 2,185,393 Treasury stock (969,275 ) (1,378,106 ) (1,379,407 ) Total stockholders' equity 1,462,532 1,423,672 1,396,697 Total liabilities and stockholders' equity $ 3,672,477 $ 3,786,643 $ 3,750,015 Current ratio 1.86 1.66 2.04 AMERICAN EAGLE OUTFITTERS, INC. CONSOLIDATED STATEMENTS OF OPERATIONS (Dollars and shares in thousands, except per share amounts) (unaudited) GAAP Basis 13 Weeks Ended October 29, 2022 % of Revenue October 30, 2021 % of Revenue Total net revenue $ 1,240,583 100.0 % $ 1,274,078 100.0 % Cost of sales, including certain buying, occupancy andwarehousing expenses 760,810 61.3 % 709,554 55.7 % Gross profit 479,773 38.7 % 564,524 44.3 % Selling, general and administrative expenses 311,101 25.1 % 313,890 24.6 % Depreciation and amortization expense 51,124 4.1 % 40,947 3.2 % Operating income 117,548 9.5 % 209,687 16.5 % Interest expense, net 3,878 0.3 % 8,612 0.7 % Other expense (income), net 782 0.1 % (3,130 ) -0.2 % Income before income taxes 112,888 9.1 % 204,205 16.0 % Provision for income taxes 31,616 2.5 % 51,981 4.1 % Net income $ 81,272 6.6 % $ 152,224 11.9 % Net income per basic share $ 0.44 $ 0.91 Net income per diluted share $ 0.42 $ 0.74 Weighted average common shares outstanding - basic 186,305 167,637 Weighted average common shares outstanding - diluted 195,776 205,013 GAAP Basis 39 Weeks Ended October 29, 2022 % of Revenue October 30, 2021 % of Revenue Total net revenue $ 3,493,745 100.0 % $ 3,502,848 100.0 % Cost of sales, including certain buying, occupancy andwarehousing expenses 2,255,929 64.5 % 1,999,743 57.1 % Gross profit 1,237,816 35.5 % 1,503,105 42.9 % Selling, general and administrative expenses 917,687 26.3 % 872,320 24.9 % Depreciation and amortization expense 146,664 4.2 % 119,674 3.4 % Operating income 173,465 5.0 % 511,111 14.6 % Debt related charges 60,066 1.7 % - 0.0 % Interest expense, net 11,887 0.3 % 26,038 0.7 % Other income, net (5,501 ) -0.2 % (6,354 ) -0.2 % Income before income taxes 107,013 3.2 % 491,427 14.1 % Provision for income taxes 36,466 1.2 % 122,226 3.6 % Net income $ 70,547 2.0 % $ 369,201 10.5 % Net income per basic share $ 0.39 $ 2.20 Net income per diluted share $ 0.36 $ 1.78 Weighted average common shares outstanding - basic 178,637 168,062 Weighted average common shares outstanding - diluted 207,499 207,032 AMERICAN EAGLE OUTFITTERS, INC. BASIC AND DILUTED EARNINGS PER SHARE RECONCILIATION (Dollars and shares in thousands) (unaudited) 13 Weeks Ended 39 Weeks Ended Numerator: October 29, 2022 October 30, 2021 October 29, 2022 October 30, 2021 Net income and numerator for basic EPS $ 81,272 $ 152,224 $ 70,547 $ 369,201 Add: Interest expense, net of tax, related to the 2025 Notes (1) 529 - 4,897 - Numerator for diluted EPS $ 81,801 $ 152,224 $ 75,444 $ 369,201 Denominator: Denominator for basic EPS - weighted average shares 186,305 167,637 178,637 168,062 Add: Dilutive effect of the 2025 Notes (1) 8,418 33,687 27,280 34,616 Add: Dilutive effect of stock options and non-vested restricted stock 1,053 3,689 1,582 4,354 Denominator for diluted EPS - adjusted weighted average shares 195,776 205,013 207,499 207,032 (1) During the 39 weeks ended October 29, 2022, the Company adopted ASU 2020-06 under the modified retrospective method, which requires the Company to utilize the "if-converted" method of calculated diluted EPS. AMERICAN EAGLE OUTFITTERS, INC. GAAP TO NON-GAAP RECONCILIATION (Dollars in thousands, except per share amounts) (unaudited) 13 Weeks Ended October 30, 2021 Interest expense, net Net income Diluted earnings per common share GAAP Basis $ 8,612 $ 152,224 $ 0.74 % of Revenue 0.7 % 11.9 % Less: Convertible debt (1) 4,569 3,330 0.02 Non-GAAP Basis $ 4,043 $ 155,554 $ 0.76 % of Revenue 0.3 % 12.2 % (1) Amortization of the non-cash discount on the Company's convertible notes AMERICAN EAGLE OUTFITTERS, INC. RESULTS BY SEGMENT (Dollars in thousands) (unaudited) American Eagle Aerie Corporate and Other (1) Total 13 weeks ended October 29, 2022 Total net revenue $ 837,575 $ 349,712 $ 53,296 $ 1,240,583 Operating income (loss) $ 174,129 $ 56,487 $ (113,068 ) $ 117,548 % of revenue 20.8 % 16.2 % 9.5 % Capital expenditures $ 20,477 $ 24,404 $ 26,626 $ 71,507 13 weeks ended October 30, 2021 Total net revenue $ 940,992 $ 315,049 $ 18,037 $ 1,274,078 Operating income (loss) $ 261,225 $ 52,021 $ (103,559 ) $ 209,687 % of revenue 27.8 % 16.5 % 16.5 % Capital expenditures $ 13,298 $ 24,867 $ 20,036 $ 58,201 American Eagle Aerie Corporate and Other (1) Total 39 Weeks Ended October 29, 2022 Total net revenue $ 2,301,051 $ 1,043,129 $ 149,565 $ 3,493,745 Operating income (loss) $ 387,213 $ 111,414 $ (325,162 ) $ 173,465 % of revenue 16.8 % 10.7 % 5.0 % Capital expenditures $ 55,000 $ 85,663 $ 58,701 $ 199,364 39 Weeks Ended October 30, 2021 Total net revenue $ 2,513,700 $ 947,851 $ 41,297 $ 3,502,848 Operating income (loss) $ 611,650 $ 191,341 $ (291,880 ) $ 511,111 % of revenue 24.3 % 20.2 % 14.6 % Capital expenditures $ 36,093 $ 48,164 $ 60,148 $ 144,405 (1) Corporate and Other includes revenue and operating results of the Todd Snyder and Unsubscribed brands, and Quiet Platforms (net of intersegment eliminations), which have been identified as operating segments but are not material to disclose as separate reportable segments. Corporate operating costs represents certain costs that are not directly attributable to another reportable segment. AMERICAN EAGLE OUTFITTERS, INC. STORE INFORMATION (unaudited) Third Quarter YTD Third Quarter 2022 2022 Consolidated stores at beginning of period 1,160 1,133 Consolidated stores opened during the period AE Brand (2) 8 19 Aerie (incl. OFFL/NE) (3) 16 51 Todd Snyder - 1 Unsubscribed - 1 Consolidated stores closed during the period AE Brand (2) (5 ) (23 ) Aerie (incl. OFFL/NE) (3) - (3 ) Total consolidated stores at end of period 1,179 1,179 AE Brand (2) 876 Aerie (incl. OFFL/NE) (3) 292 Todd Snyder 6 Unsubscribed 5 Total gross square footage at end of period (in '000) 7,309 7,309 International license locations at end of period (1) 261 261 (1) International license locations (retail stores and concessions) are not included in the consolidated store data or the total gross square footage calculation. (2) AE Brand includes AE stand alone locations, AE/Aerie side-by side locations, AE/OFFL/NE side-by-side locations, and AE/Aerie/OFFL/NE side-by-side locations. (3) Aerie (incl. OFFL/NE) includes Aerie stand alone locations, OFFL/NE stand alone locations, and Aerie/OFFL/NE side-by-side locations. View source version on businesswire.com: https://www.businesswire.com/news/home/20221121005868/en/