(CTN News) – Urban Outfitters, the apparel retailer, experienced an 8% surge in stock after reporting better-than-expected fiscal first-quarter earnings. The company outperformed Wall Street estimates on both revenue and earnings per share.
Net income for the quarter ending April 30 was $52.82 million, or 56 cents per share, compared to $31.53 million, or 33 cents per share, in the same period last year. Sales rose 6% to $1.11 billion from $1.05 billion year over year.
Urban Outfitters attributed its strong performance to a more stable supply chain and reduced freight expenses, which improved margins.
Urban Outfitters experienced a 2.6 percentage point margin increase
The company experienced a 2.6 percentage point margin increase due to higher merchandise markups and lower transportation costs. Lower markdowns at Anthropologie and Free People helped margins.
While sales at Urban Outfitters’ namesake banner declined by 13%, Free People and Anthropologie brands reported double-digit sales increases.
Additionally, the company’s rental program, Nuuly, saw significant growth, with a 118% increase in subscribers and a 125% increase in sales compared to the previous year.
Urban Outfitters considering its substantial subscriber and sales growth
Urban Outfitters is optimistic about the future of Nuuly, considering its substantial subscriber and sales growth. The rental program competes with Rent the Runway and is gaining popularity among Gen Z shoppers.
The company expects Nuuly to achieve its first profitable quarter later this year, indicating its potential for further success. Overall, Urban Outfitters’ strong financial performance and growth in key segments have favored the company in the retail industry.
- Urban Outfitters’ fiscal first-quarter earnings beat Wall Street’s estimates on the top and bottom lines.
- Sales at Urban Outfitters’ namesake banner dropped 13% year over year, but sales at its Free People and Anthropologie brands each saw double-digit increases.
- The company’s rental program Nuuly saw a 118% increase in subscribers compared to the prior-year quarter and a 125% increase in sales.
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