American Eagle Outfitters, Inc. (NYSE: AEO) has reported record fourth-quarter revenue, with a 12% increase to $1.7 billion compared to the same period last year. The company's Aerie brand achieved an all-time high fourth-quarter revenue, with comparable sales up 13%, while American Eagle's comparable sales increased by 6%, reflecting continued sequential improvement.
In the fourth quarter of 2023, total net revenue rose by 12%, driven in part by a 53rd week that contributed approximately $57 million or approximately four points to revenue growth. Store revenue increased by 10%, and total digital revenue saw a significant 19% rise. Aerie revenue reached $538 million, marking a 16% increase, while American Eagle revenue increased by 11% to $1.1 billion. The gross profit saw a substantial increase, with adjusted gross profit rising by 23% to $626 million, and the adjusted gross margin rate of 37.3% increasing by 340 basis points.
Selling, general, and administrative expenses were up 22%, with adjusted operating income of $141 million and an adjusted operating margin of 8.4%, expanding by 200 basis points compared to the same period last year. The company reported a GAAP diluted earnings per share of $0.03 and an adjusted diluted earnings per share of $0.61, with average diluted shares outstanding at 200 million.
For the fiscal year 2023, total net revenue rose by 5% to $5.3 billion, with a 53rd week contributing approximately $57 million or approximately one point to revenue growth. Aerie revenue reached $1.7 billion, up by 11%, and American Eagle revenue increased by 3% to $3.4 billion. The adjusted gross margin rate of 38.7% rose by 370 basis points, and the adjusted operating margin expanded by 170 basis points to 7.1%. The GAAP diluted earnings per share were $0.86, and the adjusted diluted earnings per share were $1.52, with average diluted shares outstanding at 197 million.
The company's total ending inventory increased by 9% to $641 million, with units up by 11%, and capital expenditures totaled $39 million in the fourth quarter and $174 million for the full year. The company recorded a $131 million impairment and restructuring charge in the fourth quarter, of which $119 million was non-cash.
Looking ahead, for fiscal 2024, management expects operating income in the range of $445 to $465 million, reflecting revenue up 2 to 4% compared to last year. For the first quarter, management expects operating income in the range of $65 to $70 million, reflecting revenue up mid-single digits.
The company will discuss its financial results and long-term strategy and targets in an extended call beginning at 11:00 am ET. The event will feature presentations and a question-and-answer session with members of the company’s executive leadership team.
American Eagle Outfitters, Inc. is a leading global specialty retailer offering high-quality, on-trend clothing, accessories, and personal care products at affordable prices under its American Eagle and Aerie brands. The company operates stores in the United States, Canada, Mexico, and Hong Kong and ships to approximately 80 countries worldwide through its websites.
Today the company's shares have moved 5.2% to a price of $24.68. If you want to know more, read the company's complete 8-K report here.
