Young adult apparel retailer Abercrombie & Fitch (NYSE: ANF) reported Q2 CY2025 results topping the market’s revenue expectations, with sales up 6.6% year on year to $1.21 billion. Guidance for next quarter’s revenue was better than expected at $1.28 billion at the midpoint, 1.8% above analysts’ estimates. Its GAAP profit of $2.91 per share was 26.6% above analysts’ consensus estimates.

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Fran Horowitz, Chief Executive Officer, said, “We delivered record second quarter net sales, exceeding our expectations, with 7% growth to last year. We continued to drive meaningful engagement with our teen customer in Hollister brands, growing 19% on strong summer and back-to-school demand. While we made progress on key inventory initiatives by leveraging promotions and testing new product concepts, Abercrombie brands net sales were down 5%, lapping 26% growth in the prior year. On the bottom line, we exceeded our second quarter profitability expectations, while also returning $50 million to shareholders through our sixth consecutive quarter of share repurchases.

Company Overview

Founded as an outdoor and sporting brand, Abercrombie & Fitch (NYSE: ANF) evolved to become a specialty retailer that sells its own brand of fashionable clothing to young adults.

Revenue Growth

Examining a company’s long-term performance can provide clues about its quality. Any business can put up a good quarter or two, but the best consistently grow over the long haul.

With $5.1 billion in revenue over the past 12 months, Abercrombie and Fitch is a mid-sized retailer, which sometimes brings disadvantages compared to larger competitors benefiting from better economies of scale.

As you can see below, Abercrombie and Fitch grew its sales at a tepid 6% compounded annual growth rate over the last six years (we compare to 2019 to normalize for COVID-19 impacts), but to its credit, it opened new stores and increased sales at existing, established locations.

This quarter, Abercrombie and Fitch reported year-on-year revenue growth of 6.6%, and its $1.21 billion of revenue exceeded Wall Street’s estimates by 1%. Company management is currently guiding for a 6% year-on-year increase in sales next quarter.

Looking further ahead, sell-side analysts expect revenue to grow 3.6% over the next 12 months, a slight deceleration versus the last six years. Despite the slowdown, this projection is above average for the sector and indicates the market is baking in some success for its newer products.

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Store Performance

Number of Stores

A retailer’s store count often determines how much revenue it can generate.

Abercrombie and Fitch opened new stores quickly over the last two years, averaging 1.5% annual growth, faster than the broader consumer retail sector.

When a retailer opens new stores, it usually means it’s investing for growth because demand is greater than supply, especially in areas where consumers may not have a store within reasonable driving distance.

Note that Abercrombie and Fitch reports its store count intermittently, so some data points are missing in the chart below.

Same-Store Sales

The change in a company's store base only tells one side of the story. The other is the performance of its existing locations and e-commerce sales, which informs management teams whether they should expand or downsize their physical footprints. Same-store sales gives us insight into this topic because it measures organic growth for a retailer's e-commerce platform and brick-and-mortar shops that have existed for at least a year.

Abercrombie and Fitch has been one of the most successful retailers over the last two years thanks to skyrocketing demand within its existing locations. On average, the company has posted exceptional year-on-year same-store sales growth of 13.5%. This performance suggests its rollout of new stores is beneficial for shareholders. We like this backdrop because it gives Abercrombie and Fitch multiple ways to win: revenue growth can come from new stores, e-commerce, or increased foot traffic and higher sales per customer at existing locations.

In the latest quarter, Abercrombie and Fitch’s same-store sales rose 3% year on year. This was a meaningful deceleration from its historical levels. We’ll be watching closely to see if Abercrombie and Fitch can reaccelerate growth.

Key Takeaways from Abercrombie and Fitch’s Q2 Results

It was good to see Abercrombie and Fitch beat analysts’ EPS expectations this quarter. We were also glad its EBITDA outperformed Wall Street’s estimates. On the other hand, its EPS guidance for next quarter missed. Overall, this print had some key positives. The market seemed to be hoping for more, and the stock traded down 2.3% to $94.48 immediately after reporting.

Is Abercrombie and Fitch an attractive investment opportunity at the current price? We think that the latest quarter is only one piece of the longer-term business quality puzzle. Quality, when combined with valuation, can help determine if the stock is a buy. We cover that in our actionable full research report which you can read here, it’s free.