Urban Outfitters URBN Q1 Earnings Report 2023 |usa4world

Urban Outfitters Shares gained nearly 8% Tuesday after the company reported first-quarter fiscal earnings that beat Wall Street estimates at the top and bottom line.

The apparel retailer performed in line with what Wall Street expected, based on a poll of analysts by Refinitiv:

  • Earnings per share: 56 cents vs 35 cents expected
  • Revenue: $1.11 billion vs. $1.09 billion expected

The company’s net income for the three-month period ended April 30 was $52.82 million, or 56 cents per share, compared with $31.53 million, or 33 cents per share, a year earlier.

Sales rose nearly 6% to $1.11 billion from $1.05 billion a year earlier.

Some retailers are benefiting from more stable supply chains and lower freight costs this earnings season, which could help their margins if they’re able to keep the line on promotions. Urban Outfitters is one of them.

Other apparel and shoe retailers such as Foot Locker saw their margins decline due to a slowdown in promotions and consumer spending. Meanwhile, Urban Outfitters saw a 2.6 percentage point increase in margin due to higher freight markups driven by lower transportation costs. Margins also benefited from lower markdowns on its Anthropologie and Free People brands, the company said.

Sales for the Urban Outfitters namesake banner declined 13% year over year, but its Free People and Anthropologie brands saw double-digit sales growth.

Nuuly, the company’s rental program, is a major competitor rent the runway It’s growing among Gen Z buyers, has seen a 118% increase in customers compared to last year’s quarter, and a 125% increase in sales.

In March, the company said it expected Nuuly to report its first profitable quarter later this year. It is not yet clear whether the segment has reached that milestone.

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