Abercrombie & Fitch Sets Q1 Sales Record While Wrestling With Tariffs

Abercrombie & Fitch broke sales records last quarter. The clothing retailer released strong Q1 2025 earnings, exceeding analysts’ expectations.

Revenue for Abercrombie reached $1.1 billion, up from Q1 2024’s reported $1.02 billion. Wall Street was looking for $1.07 billion. The retailer’s net income topped $80 million, which was a decline from $114 million in the same period last year.

“We delivered record first quarter net sales with 8% growth to last year,” said CEO Fran Horowitz in the earnings statement. “This was above our expectations and was supported by broad-based growth across our three regions.”

Abercrombie’s Hollister brand was the bright spot in the earnings report. Also setting a net sales record for the quarter, Hollister grew 22%. Comparable sales for the teen-focused brand climbed 23%.

Abercrombie’s sales are predicted to rise between 3% and 5% in the current quarter. Sales for the year will likely increase 3% to 6%. Analysts are predicting 3.3% growth for 2025.

While Abercrombie’s earnings report seemed positive for the most part, Horowitz said the company should have done better. The executive blamed an overstock of winter apparel, which forced stores to mark down prices to offload it. At the same time, many inflation-strapped consumers were more concerned with rising prices for everyday essentials, and buying new clothes simply wasn’t in the budget.

Are Tariffs Hurting Abercrombie & Fitch?

Abercrombie expects tariffs to cost the company roughly $70 million but is looking for ways to reduce the hit to $50 million. While some retailers, like Macy’s, are raising prices to mitigate tariffs, Abercrombie is trying a different tactic. The company is negotiating with suppliers to reduce costs and looking for alternative vendors.

“The more diversified we get, the faster that we can be,” CFO Robert Ball told CNBC. “We’re looking for expense reductions … across the business, but we’re doing that with a very clear eye to protecting long-term investments for the business, because we just see a ton of opportunity for these brands globally and longer term.”

While five years ago Abercrombie got 30% of its merchandise from China, that has since changed. Now, companies in Vietnam, Cambodia, and India are among its major suppliers. Under current U.S. trade policy, a 10% tariff is imposed on goods coming from these three countries.