Abercrombie & Fitch Records $5.27B Sales with 12.5% Operating Margin
Abercrombie & Fitch posted fiscal 2025 net sales of $5.27 billion (up 6%), including Q4 net sales of $1.67 billion (up 5%), and Q4 EPS of $3.68. Tariff expenses of $90 million pressured operating margin to 12.5%, as management guides 2026 net sales growth of 3–5% and 12–12.5% margin.
1. Q4 and Full-Year Sales and Earnings
Abercrombie & Fitch reported Q4 net sales of $1.67 billion, a 5% increase, with EPS of $3.68. For fiscal 2025, net sales reached a record $5.27 billion (up 6%) and full-year EPS totaled $10.46, marking the first time annual sales surpassed $5 billion.
2. Operating Performance and Tariff Impact
Fourth-quarter operating margin was 14.1%, while full-year margin declined 250 basis points to 12.5% primarily due to $90 million in tariff expenses, partially offset by freight cost savings. Hollister delivered its eleventh consecutive quarter of net sales growth, and Abercrombie Brands returned to positive growth.
3. Capital Allocation
The company ended the year with $760 million in cash and $1.2 billion in total liquidity, generating $619 million in operating cash flow and $378 million in free cash flow. Abercrombie & Fitch repurchased $450 million of shares, representing 11% of shares outstanding at the start of the year.
4. 2026 Outlook and APAC Review
For fiscal 2026, management guides net sales growth of 3–5% and an operating margin of 12–12.5%, assuming $40 million of incremental tariff expense. The company has launched a strategic review of its Asia-Pacific business to explore partnerships, franchising, and licensing to enhance returns.