Early 2025 retail holiday results show modest growth

Some retailers delivered early holiday results on Monday that showed the crucial shopping season was strong, but did not miss expectations.

Lululemonwhich is preparing to name a new CEO and begin a proxy fight with its founder, said in a statement that it expects its holiday quarter to be “towards the high end” of its previously issued guidance. Shoemaker Birkenstock And a thrift store Value Savers Village It also released lackluster early holiday results, while Abercrombie & Fitch Cut the high end of its router. Meanwhile, American eagle and Five below It bucked the trend and raised its guidance after better-than-expected holiday results.

Lululemon said it expects fiscal fourth-quarter revenue to approach $3.60 billion and earnings to approach $4.76 per share. Both numbers are at the high end of the guidance the company issued in December when it reported fiscal third-quarter earnings.

It did not make any changes to its previous guidance on gross profit margin, effective tax rate, and selling, general and administrative expenses.

Shares were slightly higher in pre-market trading.

“We remain focused on executing on our business plan to drive improvement in our U.S. business and look forward to the opportunities ahead,” Chief Financial Officer Megan Frank said in a statement.

When announcing fourth-quarter earnings on Dec. 11, outgoing CEO Calvin McDonald said the company was “encouraged” by its early holiday performance, but acknowledged that broad discounts had led to increased demand over the Thanksgiving holiday period. When the shopping period ended, trends slowed, he said at the time.

Like other high-end brands, Lululemon has historically been very selective about discounts, but has used them more liberally in recent quarters to offload outdated merchandise and styles that haven’t resonated with shoppers.

During the fiscal third quarter, margins declined by 2.9 percentage points, primarily due to higher tariffs and larger write-downs, it said at the time.

Abercrombie & Fitch shares fell about 17% in premarket trading after the retailer cut the high end of its guidance despite posting what it called “record” quarterly sales.

It now expects full-year sales to grow by “at least 6%,” down from the previous range of 6% to 7%. It expects operating margin, a closely watched measure on Wall Street, to be about 13%, compared to a previously expected range of 13% to 13.5%. The company expects earnings per share to be between $10.30 and $10.40, down from previous guidance of $10.20 to $10.50.

“Our team has remained on the offensive across product, voice and experience, resulting in record quarterly net sales year-to-date during fiscal December, in line with our expectations,” Fran Horowitz, the company’s CEO, said in a press release. “More importantly, we achieved balanced growth across our regions, brands and channels.”

Birkenstock, which did not provide specific guidance for last year’s holiday quarter, said it expects sales in the quarter ending December 31 to grow 11% to 402 million euros ($470 million). The results appeared to disappoint investors, with shares falling about 3% in pre-market trading.

Savers Value Village saw sales grow 8.4% during the holiday quarter, with comparable sales up 5.4%, excluding the impact of the extra week the company had on its calendar. Despite the relatively strong growth, the company reaffirmed its fiscal 2025 adjusted net income and EBITDA outlook. Shares were slightly higher in pre-market trading.

On the other side of the aisle, American Eagle said its holiday quarter was much better than expected, with comparable sales from the quarter through Jan. 3 up by “high single digits” and positive sales trends across brands and channels.

Comparable sales at its namesake banner grew by low-single-digit percentages, while intimate apparel line Aerie’s comps rose “in the low 20s.”

American Eagle said the “record” season lifted its fourth-quarter operating income to $167 million to $170 million, from $155 million to $160 million.

“The momentum continued in the fourth quarter with record December sales supported by the strength of our brands, with particularly strong growth at Aerie and Offline and sequential growth at American Eagle,” CEO Jay Schottenstein said in a press release. “Our customers have embraced new product combinations and responded to our latest marketing initiatives, with continued strength post-holiday.”

Five Below said year-to-date quarterly sales were up 23.2% as of Jan. 3, while comparable sales were up 14.5%.

“We are extremely pleased with our holiday performance, which demonstrates the effectiveness of the strategies we have implemented this year,” CEO Winnie Park said in a press release. “Through our obsessive focus on the customer: the child and the child in all of us, we have delivered amazing, on-trend products at exceptional value and begun to create a better connected customer journey.” “Combined with close collaboration and alignment across the company, we have achieved strong, broad-based results.”

The company now expects fiscal fourth-quarter sales to be about $1.71 billion, up from the previous range of $1.58 billion to $1.61 billion, as it nearly doubled its comparable sales forecast to 14%, up from between 6% and 8%.

Earnings per share are expected to be in the range of $3.93 to $3.98, up from previous guidance of $3.34 to $3.52. Five Below expects adjusted earnings per share to be between $3.95 and $4, up from the previous range of $3.36 to $3.54 per share.

The early results, announced ahead of the ICR’s annual conference in Orlando, Florida, show what many analysts expect for the holiday shopping season. There will continue to be highlights with strong growth, but across the board, Wall Street largely expects results to be strong without massive, widespread gains in consumer spending.

The National Retail Federation previously forecast that retail sales in November and December would rise between 3.7% and 4.2% compared to 2024. That’s strong growth, but when higher prices due to tariffs are taken into account, some analysts expect volume growth to be largely flat.