American Eagle Outfitters Results Beat Estimates

American Eagle Outfitters' shares are lower on Wednesday even as its second-quarter results exceeded Wall Street's expectations.
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American Eagle Outfitters  (AEO) - Get Report shares fell on Wednesday even after the clothing and accessories retailer posted better-than-expected fiscal-second-quarter earnings.

American Eagle stock recently traded at $12.90, down 2.3%. It had slid 10% so far this year through Tuesday. The stock has about doubled off its 52-week low of $6.54, set in late April.

Like other retailers, American Eagle has suffered from the coronavirus pandemic, which has shut stores and kept shoppers at home.

For the quarter ended Aug. 1, American Eagle reported a net loss of $13.8 million, or 8 cents a share, swinging from profit of $65 million, or 38 cents, in the year-earlier quarter.

The adjusted loss was 3 cents a share in the latest quarter, better than the 17-cent loss predicted by analysts surveyed by FactSet.

The Pittsburgh company registered revenue of $883.5 million, down 15% from $1.04 billion in the year-ago quarter. The FactSet analyst consensus had pegged revenue at $823 million for the latest quarter.

“In the midst of an unprecedented crisis, we delivered a significant improvement from the first quarter throughout our business,” Chief Executive Jay Schottenstein said in a statement.

“Aerie [AEO’s intimate-apparel brand for women] was simply outstanding, fueled by strong demand, with revenue rising 32% and record margins, demonstrating the power of the brand and signaling the vast opportunity ahead. Across brands, digital sales accelerated, and we successfully reopened stores during the quarter.”

During the pandemic, AEO “reduced expenses, cut inventories and carefully managed liquidity,” Schottenstein said. “We … generated positive free cash flow, strengthening our balance sheet.”