Published by Global Banking & Finance Review®
Posted on August 27, 2025
2 min readLast updated: January 22, 2026
Add as preferred source on GoogleAbercrombie & Fitch raises its sales forecast due to strong Hollister demand, despite facing increased tariff costs. The company expects 5% to 7% sales growth in 2025.
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By Savyata Mishra
(Reuters) -Abercrombie & Fitch raised its annual sales forecast on Wednesday, driven by robust demand for Hollister dresses and denim jeans as shoppers prioritize spending on trendy apparel undeterred by price hikes.
The apparel retailer, whose denim jeans are priced at an average of $100, has driven growth at its eponymous and Hollister brands by targeting affluent female shoppers.
Well-heeled shoppers in the U.S. have so far shown little resistance to price hikes, as indicated by resilient spending on aspirational goods such as Birkenstock sandals and Bugaboo strollers.
"Abercrombie's results show that consumers remain willing to invest in premium apparel, especially when it reflects strong brand equity and trend relevance," Jefferies analyst Corey Tarlowe said.
However, higher tariffs on countries such as Vietnam, Indonesia, Cambodia and India will increase costs by $90 million this year, Abercrombie warned. In May, it had estimated $50 million in tariff expenses after mitigating some impact.
U.S. President Donald Trump's trade policies have also pressured margins of other retailers such as Ralph Lauren and Coach handbag owner Tapestry.
Abercrombie would tightly control inventory levels to cushion the hit from tariffs and support its growth plans, company executives said on a post-earnings conference call.
The company now expects net sales for fiscal year 2025 to grow in the range of 5% to 7%, compared to its prior forecast of a 3% to 6% increase.
Annual net income per share is projected in the range of $10 to $10.50, compared with its earlier forecast between $9.50 and $10.50.
Shares of the company rose about 1.5% in volatile trading as it also topped second-quarter estimates. The stock is down about 33% this year.
Net sales were $1.21 billion for the quarter ended August 2, compared with analysts' average estimate of $1.20 billion, according to data compiled by LSEG.
Its adjusted profit of $2.32 per share beat estimates of $2.30 a share.
(Reporting by Savyata Mishra in Bengaluru; Editing by Leroy Leo)
Abercrombie now expects net sales for fiscal year 2025 to grow in the range of 5% to 7%, an increase from its prior forecast of 3% to 6%.
Abercrombie warned that higher tariffs on countries such as Vietnam, Indonesia, Cambodia, and India will increase costs by $90 million this year.
Shares of Abercrombie rose about 1.5% in volatile trading after it topped second-quarter estimates, although the stock is down about 33% this year.
The apparel retailer has driven growth by targeting affluent female shoppers, particularly with its Hollister brand.
Corey Tarlowe noted that Abercrombie's results indicate that consumers are willing to invest in premium apparel that reflects strong brand equity and trend relevance.
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