Abercrombie & Fitch Stock Plummets After Weak 2025 Forecast

Abercrombie & Fitch's recent sales forecasts have disappointed investors, leading to a nearly 14% drop in its stock price. The company anticipates sales growth of only 3% to 5% for fiscal 2025, significantly below analyst expectations of 6.8%, driven by higher inventory levels and tariff impacts from goods imported from China, Canada, and Mexico. CEO Fran Horowitz noted a normalization in spring demand, with the flagship Abercrombie brand showing weaker performance compared to Hollister, which saw a notable 16% sales increase. Additionally, the projected earnings per share (EPS) for the upcoming quarter range from $1.25 to $1.45, falling short of the consensus estimate of $1.97. Despite a strong 2024 performance with a 16% rise in net sales, the outlook for 2025 appears cautious, affected by ongoing inflation and economic uncertainties. The company has initiated a share repurchase program, highlighting its commitment to shareholder value amid challenging conditions.