American Eagle Outfitters Reports Q2 Earnings with Strong Aerie Performance and Tariff Refunds
American Eagle Outfitters (AEO) reported second-quarter earnings for fiscal year 2026, driven by strong performance from its Aerie brand. The company recorded net revenue of $1.38 billion, up 8%, with Aerie contributing significantly at $536 million in total revenue—a 25% increase—due to broad demand across categories and channels. American Eagle's segment saw more modest growth, with a 1% rise in total revenue but also reported sequential improvement from the first quarter. The company’s operating profit reached $211 million, largely due to a $161 million net benefit from tariff refunds under IEEPA regulations. Gross margin expanded by over 130 basis points to 48.7%, while merchandise margins were negatively impacted by markdowns at American Eagle. SG&A expenses rose 19% as the company increased advertising and compensation tied to tariffs. Looking ahead, AEO expects mid- to high single-digit comparable sales growth in Q3 with operating income guidance between $110 million and $115 million for the quarter. For fiscal year 2026, it forecasts total operating income of $540–$550 million, including tariff refund benefits.
Tickers: $AEO
Topics: Comparable Sales EPS Gross Profit Operating Margin Revenue