Why Abercrombie & Fitch (ANF) Shares Are Surging Today - Abercrombie & Fitch (NYSE:ANF)

Abercrombie & Fitch Co ANF reported first-quarter FY23 sales growth of 3% year-on-year to $835.99 million, beating the analyst consensus estimate of $814.53 million.
Adjusted EPS of $0.39 beat the consensus of $(0.05).
U.S. sales increased 9% Y/Y while International sales declined 12%. Abercrombie brand sales rose 14%, while Hollister sales fell 7%.
Gross profit margin expanded 570 basis points to 61%. Operating income for the quarter was $34 million versus a loss of $(10) million a year ago, with the margin of 4.1%.
The company held $447 million in cash and equivalents as of Apr. 29, 2023. The operating cash flow was a use of $(1) million.
Inventories decreased 20% to $448 million at the end of Q1.
"Looking ahead, we remain cautiously optimistic on consumer demand and our ability to react to a dynamic macro environment, further supported by our strong balance sheet," said CEO Fran Horowitz.
Outlook: ANF expects Q2 net sales growth of 4% - 6% and an operating margin of 2% - 3%.
For FY23, ANF raised net sales growth guidance from 1% - 3% to 2% - 4%. It also lifted FY23 operating margin guidance from 4% - 5% to 5% - 6%.
Price Action: ANF shares are trading higher by 18% at $27.17 in premarket on the last check Wednesday.

Why Abercrombie & Fitch Shares Are Surging Today