A Trip Down Mall-mory Lane

Several retailers reported today, many of which have a significant mall presence. Let’s see how they fared and what they said about the U.S. consumer. 🏬

First up is Kohl’s, which reported an unexpected first-quarter profit. Profitability improved as freight costs declined, and the company became more pointed with its promotional activity after getting inventory levels back under control. That led to adjusted earnings per share of $0.13, beating the $0.42 loss expected. Revenue of $3.36 billion and comparable-store sales declines of 4.3% were essentially in line with expectations.

The Kohl’s brand has struggled to remain relevant among consumers, but executives stressed the changes they’re making are paying dividends. The company is opening more Sephora shops, expanding into categories like pet and home decor, and featuring gift-giving items ahead of key holidays. With that said, the “middle-income consumer,” which is the core of its customer base, remains pinched by high inflation and economic uncertainty. 😬

The company remains the target of activist investors who have successfully pushed a CEO and board of directors. Last year, it also failed to sell itself to Vitamin Shoppe owner Franchise Group.

Like other “old school” retailers, Kohl’s has a lot of work to do in reinventing itself for today’s consumers. $KSS shares rose 7% today but are still trading at the same level as the late 1990s. 🤷

Abercrombie & Fitch also reported a surprise profit and raised its guidance. Its adjusted earnings per share of $0.39 on revenues of $836 million beat the expected $0.05 loss and $815 million in revenues. Same-store sales were also up 3% vs. the 1% decline expected. Additionally, executives raised their net sales growth from 1%-3% to 2%-4%. They also increased their operating margin outlook from 4%-5% to 5%-6%. That sent $ANF shares up over 30% on the day. 🤩

Next up is Express, which we spoke about two months ago as bankruptcy fears rose. While shares rebounded with the market since then, today’s earnings have it pushing back toward their all-time lows. $EXPR shares were down more than 15% on the day. 📉

Its adjusted loss per share of $0.99 and revenues of $383.3 million missed the $0.79 and $389 million consensus estimates. Same-store sales fell 14% due to what executives described as “a combination of external factors and challenges in our product assortments.” Consumers remain price sensitive as they reduce discretionary spending, causing Express and its competitors to increase promotions. As a result, it’s being hit on both the revenue and margin side, as its financials reflect.

American Eagle Outfitters also didn’t fare well. Although its adjusted earnings per share and revenue matched estimates, it cut its operating income outlook. It now expects $250 to $270 million vs. the $270 to $310 million range it forecasted in March. It also anticipates full-year revenue to be flat to down low single-digits vs. flat to up single-digits. Its brand performance remains mixed, with Aerie’s comparable-store sales up 2% and American Eagle’s down 2%. Lastly, store revenue rose 5% while digital revenue fell 4%. $AEO shares are down 16% after the bell. 🦅

Lastly, we’ll mention Guess. The retailer lost $0.22 per share on revenues of $570 million. That compared to estimates of a $0.28 per share loss on $556 million in revenue. Executives expect fiscal 2024 revenue growth of 2% to 4% and adjusted earnings per share of $2.60 to $2.90. They also increased the dividend from 22.5 cents per share to 30 cents. $GES shares are up about 2% after hours. 🔺

More in   Earnings

View All

Zoom Avoids Doom (Again)

Zoom Video Communications hasn’t made headlines for many good reasons lately, scraping the bottom of its range as a public company as investors look for other opportunities. However, the stock is jumping today on better-than-expected results, so let’s take a look. 👇

The video chat software vendor’s adjusted earnings per share of $1.22 on $1.15 billion in revenues topped expectations of $1.15 and $1.13 billion. Revenue growth remains anemic, rising just 3% YoY, but the company’s cost-cutting has helped it drive positive earnings vs. last year’s loss. 

Read It

CrowdStrike Bucks The Cyber Selloff

After Palo Alto Networks and other cybersecurity stocks failed to meet expectations, the market highly anticipated CrowdStrike’s earnings after the bell. And unlike its peers, the company delivered big time, so let’s take a look. 👇

Adjusted earnings per share of $0.95 beat expectations of $0.82, while revenues of $845 million topped the $839 million anticipated. Notably, the firm has reported GAAP net income for the past four quarters, and management expects that trend to continue. 💵

Read It

The Battle Of The Clothing Boxes

The online personal styling business might’ve been a solid bet during the ZIRP era, but it has really taken a beating in the post-pandemic world. Today, we heard from Stitch Fix and ThredUp, battling for survival in the public markets. 📦

First up, Stitch Fix reported a $0.29 per share loss on $330.40 million in revenues. Both numbers missed estimates of a $0.22 loss and $330.88 million. Looking ahead, the company’s third-quarter revenue guidance of $300 to $310 million also missed expectations. 🔻

Read It