Shares of American Eagle Outfitters AEO jumped more than 11% in pre-market trading after the company reported upbeat results for the second quarter.
The Pittsburgh, Pennsylvania-based company posted quarterly earnings of $5.81 million, or $0.03 per share, compared to $19.59 million, or $0.10 per share, in the year-earlier period.
Its revenue fell to $710.6 million from $727.3 million. However, analysts were expecting earnings of $0.00 per share on revenue of $690 million.
American Eagle's same-store sales dropped 7%. Gross profit fell 3% to $238 million, while operating income slipped 59% to $12 million.
Selling, general and administrative expense rose 2% to $190 million in the quarter. At the end of the second quarter, total merchandise inventories dropped 15% to $393 million.
In the quarter, American Eagle opened 20 new stores.
American Eagle now expects Q3 earnings of $0.17 to $0.19 per share, versus analysts' estimates of $0.18 per share.
Jay Schottenstein, Interim CEO, said, “Although the second quarter results were slightly ahead of our expectations, they do not reflect our potential.”
American Eagle shares jumped 11.22% to $12.89 in pre-market trading.
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