Following the lifting of COVID-19 limits, customers returning to schools and offices shopped more at American Eagle Outfitters physical shops, beating quarterly revenue projections on Tuesday.
People who were locked at home during lockdowns wore comfy joggers and sweatshirts, but the reopening of schools, workplaces, and public spaces after vaccines has led them to reinvest in streetwear, such as jeans and shirts.
Despite port congestion and certain factory closures, most U.S. apparel retailers, including T.J. Maxx parent TJX and Macy's, have dismissed holiday inventory concerns.
Inventory at cost jumped 32% to $740 million at the end of the third quarter, as the company used more expensive air freight to deal with global supply chain challenges.
Following its acquisition of AirTerra earlier this year, the clothes retailer has been beefing up its logistics game, agreeing to buy Quiet Logistics for $350 million this month.
According to data, their total net revenue climbed 24 % year over year to $1.27 billion in the third quarter ended Oct. 30, above analysts' average forecast of $1.23 billion.
Income for the American Eagle label increased by 21% to $941 million, while revenue for the Aerie brand, which sells leggings and bras, increased by 28% to $315 million.
Overall net income increased 162 % to $152.2 million, with adjusted profit per share coming in at 76 cents.