American Eagle Shares Plunge 8.4% as Q4 Sales Guidance Rises 8–9%
American Eagle Outfitters shares dropped 8.42% to close at $22.50 on Monday as investors reacted to upcoming earnings. The company raised Q4 comparable sales growth guidance to 8–9% and operating income to $167–170 million, while forecasting a $50 million net tariff impact.
1. Shares drop ahead of earnings
On Monday, American Eagle Outfitters shares declined 8.42% to $22.50 as investors positioned ahead of the March 4 earnings call covering fourth-quarter and full-year 2025 results. The slide reflected market anticipation of the company’s updated financial targets.
2. Fourth-quarter guidance updated
Management now expects comparable sales growth of 8–9% year-over-year for Q4 and has increased operating income guidance by $12 million to $167–170 million, up from the prior range of $155–160 million. These revisions signal stronger holiday demand than earlier forecast.
3. Tariff impact forecasts
The company projects a net tariff headwind of approximately $50 million in Q4 and $70 million for the full year ending January 3, 2026. These elevated costs are anticipated to pressure margins despite stronger sales trends.
4. Brand performance drives momentum
During the quarter, Aerie delivered low-twenty percent comparable sales growth while the American Eagle brand grew by low single digits, contributing to record December results. CEO Jay Schottenstein highlighted the power of new collections and marketing initiatives in driving post-holiday strength.