Key Highlights

  • Net sales reached $1.27 billion in the fiscal 2026 second quarter, up 5%, a second quarter record for both brands.
  • GAAP operating income was $252.7 million, a 19.9% margin that includes about $100 million of IEEPA tariff refunds.
  • Diluted earnings per share were $4.17, up from $2.91, though last year's figure included a litigation settlement gain.
  • Management raised fiscal 2026 diluted EPS guidance to $13.10 to $13.60 and expects at least $500 million of share repurchases.

Abercrombie & Fitch (NYSE:ANF) shares were trading near their 52-week high at USD 160.16 on October 19, 2026, up 4.50%. The apparel retailer last reported on August 26, with record second quarter sales at both brands and an operating margin that included roughly $100 million of tariff refunds. Six large brokerages have published ratings and targets since that report, and the company's filings also flag a strategic review of its Asia-Pacific business.

Brokerage ratings split between positive and neutral

Six large brokerages have acted since the August 26 results. On August 27, Goldman Sachs kept a Buy rating and set a $160 target, up from $124, and UBS kept Buy with a $185 target, up from $153. Citi downgraded its rating to Neutral the same day, with a $156 target, up from $135, while Barclays and Morgan Stanley each held Equal Weight, with targets of $155 and $134, up from $114 and $87. BMO Capital Markets began coverage on September 8 with an Outperform rating and a $170 target. The price sits above four of the six targets and below two. These are the firms' views, not a forecast.

Record sales, with a tariff refund inside the profit line

Net sales for the thirteen weeks ended August 1 were $1,266.7 million, up 5% from $1,208.6 million, while comparable sales were flat. Abercrombie brands grew 8% to $596.8 million, with comparable sales up 4%. Hollister grew 2% to $669.9 million, with comparable sales down 3%. APAC sales rose 19%. Management called it the company's 15th consecutive quarter of growth.

On a GAAP basis, operating income was $252.7 million, a 19.9% margin versus 17.1% a year earlier. The company said that figure includes approximately $100 million of IEEPA tariff refunds recorded as a reduction of cost of sales, which it estimated added about $1.75 to diluted earnings per share. Net income attributable to the company was $183.7 million, or $4.17 per diluted share. The prior-year quarter's $2.91 included a litigation settlement gain. Excluding it, adjusted diluted EPS, a non-GAAP measure, was $2.32.

Cash and equivalents were $627.7 million at August 1, and the $500 million credit facility had no borrowings outstanding. Operating cash flow for the first 26 weeks was $313.4 million, up from $112.9 million. Repurchases totaled 3.2 million shares for $282 million year to date, with $568 million left on the authorization.

Fall partnerships, an APAC review and other cautions

On September 22, the Abercrombie & Fitch brand said it returns for a second year as Official Fashion Partner of the Dallas Cowboys and the Dallas Cowboys Cheerleaders. On September 24, activewear brand YPB announced a multi-season partnership with fitness studio Barry's, with a first collection of six men's and 12 women's styles on sale from October 1.

The filings carry cautions too. The annual report says the company announced in March 2026 that it is reviewing strategic alternatives for its APAC region, and the August release refers to the review in its risk language. Store impairment charges were $1.5 million in the quarter, mostly tied to EMEA and APAC stores, and pre-tax losses of $19.0 million, primarily in Switzerland, carried no tax benefit.

Guidance raised for fiscal 2026

On August 26, the company replaced its May 27 guidance. For fiscal 2026 it now expects net sales growth of around 5% (from 3% to 5%), operating margin of 14.5% to 15.0% (from 12.0% to 12.5%) and diluted EPS of $13.10 to $13.60 (from $10.20 to $11.00). The outlook includes about 220 basis points of margin from IEEPA refunds, assumed at $120 million before interest, and about 30 net new owned-and-operated stores. For the third quarter it guided to net sales growth of 5% to 6%, operating margin of 13.0% to 14.0% and diluted EPS of $2.90 to $3.20. These are the company's own estimates. No third-quarter results date is listed among its news releases yet.