Abercrombie & Fitch beat second-quarter earnings expectations and raised full-year profit guidance, lifting its stock buyback authorization to at least $500 million from $450 million.
The apparel retailer reported second-quarter earnings per share of $4.17, exceeding consensus estimates of roughly $1.97, according to the company's announcement. The beat included approximately $100 million in tariff refunds that inflated the quarter's results relative to prior-year EPS of $2.91. The company raised its full-year fiscal 2026 EPS guidance to a range of $13.10 to $13.60, up from a prior range of $10.20 to $11.00.
Abercrombie has emerged as a consistent outperformer in apparel retail over the past two years, driven by demand for its premium positioning and a successful turnaround of its Hollister brand. The fiscal 2026 guidance increase of roughly 20 percent at the midpoint includes the tariff-driven Q2 benefit and the company's confidence in sustained consumer demand through the remainder of the year.
The buyback expansion to $500 million from $450 million comes as shares have risen this year. Apparel retailers have faced uneven results across the sector, with luxury brands weathering softer demand in certain geographies while mass-market competitors have struggled with margin pressure. Abercrombie's ability to command pricing and grow earnings faster than its peers has rewarded shareholders and allowed the company to accelerate capital returns.
The guidance lift assumes tariff refunds continue and that consumer spending on discretionary apparel holds through the holiday season. The second-quarter beat was anchored in the tariff benefit, which will not repeat in the third or fourth quarters, making execution on underlying sales and margins critical to reaching the full-year range.
