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Key takeaways
- Shares of American Eagle Outfitters rose Wednesday after the retailer reported better-than-expected earnings and boosted its outlook.
- The retailer said it benefited from the success of advertising campaigns with actress Sydney Sweeney and NFL star Travis Kelce.
American Eagle Outfitters stock got a big boost from celebrity hype.
Shares of the clothing retailer rose nearly 15% in recent trading, after the company reported stronger-than-expected earnings, with a little help from ads featuring actress Sydney Sweeney and NFL star and Taylor Swift’s fiancé Travis Kelce.
American Eagle (AEO) reported earnings per share of $0.53 on revenue that jumped 5.7% year over year to $1.36 billion in the third quarter. Both numbers exceeded analyst estimates compiled by Visible Alpha.
CEO Jay Schottenstein told investors on the company’s earnings call that its results benefited “from the success of our recent marketing campaigns, which drove engagement and attracted new customers.” American Eagle “felt encouraged by the impact of campaigns, collaborations with Sidney Sweeney and Travis Kelce, and now holiday gifts with Martha Stewart,” Schottenstein said, according to a transcript provided by AlphaSense.
Why is this important?
After spending most of the year in negative territory, enthusiasm for American Eagle’s celebrity campaigns has helped bring some enthusiasm back into the stock, putting it back in positive territory for the year, although some on Wall Street have raised concerns about whether the company can maintain that momentum.
American Eagle had a record Thanksgiving weekend, and “the fourth quarter is off to an excellent start,” Schottenstein said. The company now sees full-year adjusted operating income of $303 million to $308 million, up from the previous forecast of $255 million to $265 million, and comparable store sales growth in the low single digits, compared to the previous flat forecast.
With Wednesday’s gains, American Eagle shares are up about 45% for 2025.
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