American Eagle Same-Store Sales Growth Disappoints


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American Eagle Outfitters Inc. on Wednesday said comparable-store sales at its namesake stores rose at a smaller rate than in previous quarters.

Shares dropped 11% to $16.81 in early trading as the company also released profit guidance that was below expectations.

In the third quarter, American Eagle posted 2% overall comparable sales growth, below the 2.9% that analysts polled by Thomson Reuters were expecting. At its namesake brand, comparable sales inched up 0.4% while at its lingerie brand, Aerie, sales increased 21%.

Jay L. Schottenstein, the company's longtime chairman and chief executive for about a decade through 2002, retook the helm of the retailer in 2014 and became permanent CEO last December. Recently, the company appointed a new chief financial officer and named its first chief technology officer.

For the period ended in October, American Eagle reported profit of $75.8 million, or 41 cents a share, compared with a profit of $74.1 million, or 38 cents a share, a year prior. Revenue rose 2.3% to $940.6 million.

Analysts polled by Thomson Reuters had expected earnings per share of 41 cents on revenue of $940.9 million.

American Eagle started with one store at Twelve Oaks Mall in Novi, Mich., and initially focused on outdoor-sports apparel and equipment. It later recast itself as a clothing retailer with a collegiate flair. The retailer, part of the retail empire of the Schottenstein family of Columbus, Ohio, went public in 1994.

Selling, general and administrative expenses decreased to $220 million as increased advertising spending was offset by controlling other expenses.

At quarter's end, the company had 1,052 total stores with 6.6 million gross square feet of retail space.

Write to Austen Hufford at austen.hufford@wsj.com


  (END) Dow Jones Newswires
  11-30-160925ET
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This article appears in: News Headlines
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