Abercrombie & Fitch shares jumped by as much as 20% in pre-market trading on Friday after the company posted third-quarter earnings results.
The apparel retailer crushed expectations, marking a departure from other companies in the industry during this quarter. JC Penney, Macy's, and Nordstrom are others who reported weaker-than-expected results.
Abercrombie & Fitch reported third-quarter sales of $879 million, beating the forecast for $863 million according to Bloomberg. Adjusted earnings per share came in at $0.48, versus $0.22 expected.
Comparable-store sales, which gauge revenues at stores open for at least one year, were better than expected in the US and internationally. US comp store sales fell 3% (-4% expected), and rose 1% abroad (-10% forecast).
The company said in a statement that these results were "the strongest validation yet that our initiatives are working."
Executive chairman Arthur Martinez told The Wall Street Journal that these initiatives included having fewer discounted items on sale. Customers, in fact, bought items at full-sale price, Martinez said, boosting the company's gross margin rate to 63.7% from 62.2% a year ago.
But this retailer, just like its other peers, is not out of the woods just yet, as the industry grapples with slowing sales. It forecast flat comparable-store sales for the fiscal fourth quarter, and a continued dent to revenues from currencies weaker than the US dollar.
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