Q3 2025 American Eagle Outfitters Inc Earnings Call

December 2, 2025

Vote. Should you need assistance, please signally conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions to ask a question. You may press star then 1 on your telephone keypad to withdraw your question. Please press star then 2

Please note this event is being recorded.

I would now like to turn the conference over to Judy nihan.

Head of investor relations and corporate Communications. Please go ahead.

everyone joining me today for our prepared remarks are

Executive officer.

Speaker #1: Welcome to the AEO Inc. third quarter 2025 earnings conference call. All participants will be in listen-only mode. Should you need assistance, please signal the conference specialist by pressing the star key followed by zero.

Operator: Welcome to the AEO Inc. Q3 2025 earnings conference call. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star, then one on your telephone keypad. To withdraw your question, please press star, then two. Please note this event is being recorded. I would now like to turn the conference over to Judy Meehan, Head of Investor Relations and Corporate Communications. Please go ahead.

Demo president executive creative director, for American Eagle and our and Mike mg financial officer.

Before we begin today's call, I need to remind you that we will make certain forward-looking statements. These statements are based upon information that represents the company's current expectations or beliefs

Speaker #1: After today's presentation, there will be an opportunity to ask questions. To ask, please use your telephone keypad. To withdraw your question, please press star, then two.

the results actually realize May differ materially based on risk, factors included in our SEC filings

Speaker #1: Please note this event is being recorded. I would now like to turn the conference over to Judy Meehan, Head of Investor Relations and Corporate Communications.

The company undertakes, no obligation to publicly update, or revise, any forward-looking statements. Whether as a result of new information, future events or otherwise except as required by law.

Speaker #1: Please go ahead.

Speaker #2: Good afternoon, everyone. Joining me today for our prepared remarks are Jay Schottenstein, Executive Chairman, and Chief Executive Officer, Jen Foyle, President, Executive Creative Director for American Eagle and Airy, and Mike Mathias, Chief Financial Officer.

Judy Meehan: Good afternoon, everyone. Joining me today for our prepared remarks are Jay Schottenstein, Executive Chairman and Chief Executive Officer; Jen Foyle, President, Executive Creative Director for American Eagle and Aerie; and Mike Mathias, Chief Financial Officer. Before we begin today's call, I need to remind you that we will make certain forward-looking statements. These statements are based upon information that represents the company's current expectations or beliefs. The results actually realized may differ materially based on risk factors included in our SEC filings. The company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise, except as required by law. Also, please note that during this call and in the accompanying press release, certain financial metrics are presented on both a GAAP and non-GAAP adjusted basis.

Also, please note that during this call and in the accompanying press release, certain Financial metrics are presented on both a gaap and non-gaap adjusted basis.

Speaker #2: Before we begin today's call, I need to remind you that we will make certain forward-looking statements. These statements are based upon information that represents the company's current expectations or beliefs.

Reconciliations of adjusted results to the Gap. Results are available in the tables attached to the earnings release, which is posted on our corporate website at www.ae.com in the investor relations section.

Here, you can also find our third quarter investor presentation.

And now, I'll turn the call over to Jay.

Speaker #2: The results actually realized may differ materially based on risk factors, included in our SEC filings. The company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise, except as required by law.

Thanks, Judy and good afternoon. I hope everyone had an enjoyable Thanksgiving weekend.

I'm extremely pleased with the trend change. We've seen across Brands reflecting a number decisive, steps. We've taken for merchandising to marketing to operations.

Speaker #2: Also, please note that during this call, and in the accompanying press release, certain financial metrics are presented on both a gap and non-gap adjusted basis.

These deliberate actions are having a positive impact on near-term results and also serve us well for the long run.

Speaker #2: Reconciliations of adjusted results to the GAAP results are available in the tables attached to the earnings release, which is posted on our corporate website at www.aio-inc.com in the Investor Relations section.

Judy Meehan: Reconciliations of adjusted results to the GAAP results are available in the tables attached to the earnings release, which is posted on our corporate website at www.aeo-inc.com in the Investor Relations section. Here, you can also find our Q3 Investor presentation. And now, I'll turn the call over to Jay.

Reconciliations of adjusted results to the GAAP results are available in the tables attached to the earnings release, which is posted on our corporate website at www.aeo-inc.com in the Investor Relations section. Here, you can also find our Q3 Investor presentation. And now, I'll turn the call over to Jay.

We delivered record Revenue in the third quarter and very strong momentum is carried into the fourth quarter.

We're seeing and encouraging you to respond to the newness that teams are delivering.

Speaker #2: Here you can also find our third-quarter investor presentation. And now I'll turn the call over to Jay.

With each new collection gaining steam. The most notably area and offline are generating exceptional growth across categories.

Speaker #3: Thanks, Judy, and good afternoon. I hope everyone had an enjoyable Thanksgiving weekend. I'm extremely pleased with the trend change we've seen across brands. Reflecting a number of decisive steps we've taken for merchandising to marketing to operations.

Jay Schottenstein: Thanks, Judy, and good afternoon. I hope everyone had an enjoyable Thanksgiving weekend. I'm extremely pleased with the trend change we've seen across brands, reflecting a number of decisive steps we've taken from merchandising to marketing to operations. These deliberate actions are having a positive impact on near-term results and also serve us well for the long run. We delivered record revenue in the Q3, and very strong momentum has carried into Q4. We're seeing an encouraging response to the newness that teams are delivering, with each new collection gaining steam. Most notably, Aerie and OFFLINE are generating exceptional growth across categories. As discussed last quarter, we have made incremental investments in advertising, which is contributing to stronger demand, while better positioning our business for enhanced long-term brand awareness and overall customer engagement.

As discussed last quarter, we obeyed incremental investments in advertising, which has contributing to Stronger demand, while better positioning our business for enhanced long-term brand awareness and overall customer engagement.

Speaker #3: These deliberate actions are having a positive impact on near-term results and also serve us well for the long run. We delivered record revenue in the third quarter, and very strong momentum has carried into the fourth quarter.

At the same time, we are focused on operational, improvements and cost efficiencies to drive higher profitability and what continues to be a dynamic macro environment.

Turning to the quarter total revenue, increase 6% to 1.4 billion dollars.

The third quarter record.

Speaker #3: We're seeing an encouraging response to the newness that teams are delivering. With each new collection gaining steam, most notably, Airy and Offline are generating exceptional growth across categories.

Operating income of 113 million. Exceeded our guidance of 95 to 100 million dollars fueled by higher than expected demand and well to control costs.

Speaker #3: As discussed last quarter, we have made incremental investments in advertising, which have contributed to stronger demand while better positioning our business for enhanced long-term brand awareness and overall customer engagement.

As previously noted, our results also included about 20 million dollars of net impact from terrorists.

Diluted EPS for the quarter of a 53 cents. Increased 10% compared to the adjusted EPS last year.

Speaker #3: At the same time, we are focused on operational improvements and cost efficiencies to drive higher profitability in what continues to be a dynamic macro environment.

Jay Schottenstein: At the same time, we are focused on operational improvements and cost efficiencies to drive higher profitability in what continues to be a dynamic macro environment. Turning to the quarter, total revenue increased 6% to $1.4 billion, a Q3 record. Operating income of $113 million exceeded our guidance of $95 to $100 million, fueled by higher-than-expected demand and well-controlled costs. As previously noted, our results also included about $20 million of net impact from tariffs. The diluted EPS for the quarter of $0.53 increased 10% compared to the adjusted EPS last year. The strong top line reflected a return to positive comps, which increased 4%. This was a meaningful acceleration from the 1% decrease last quarter. Improvement was made across both brands and channels, all posting positive comps. Aerie's 11% comp in Q3 was a real standout, for strong demand was broad-based across all categories.

At the same time, we are focused on operational improvements and cost efficiencies to drive higher profitability in what continues to be a dynamic macro environment. Turning to the quarter, total revenue increased 6% to $1.4 billion, a Q3 record. Operating income of $113 million exceeded our guidance of $95 to $100 million, fueled by higher-than-expected demand and well-controlled costs. As previously noted, our results also included about $20 million of net impact from tariffs. The diluted EPS for the quarter of $0.53 increased 10% compared to the adjusted EPS last year. The strong top line reflected a return to positive comps, which increased 4%. This was a meaningful acceleration from the 1% decrease last quarter. Improvement was made across both brands and channels, all posting positive comps. Aerie's 11% comp in Q3 was a real standout, for strong demand was broad-based across all categories.

The strong Top Line, reflected a return to positive comps, which increased 4%.

This was a meaningful acceleration from the 1%. Decrease last quarter.

Improvement was made across both Brands and channels.

Speaker #3: Turning to the quarter, total revenue increased 6% to $1.4 billion, a record for the third quarter. Operating income of $113 million exceeded our guidance of $95 to $100 million, fueled by higher-than-expected demand and well-controlled costs.

All posting positive comps.

Areas 11% comp. In the third quarter was a real standout for strong demand was broad-based across all categories.

Growth accelerated throughout the period which has continued into the fourth quarter where we are seeing exceptional demand so far.

Speaker #3: As previously noted, our results also included about $20 million of net impact from tariffs. Diluted EPS for the quarter of $0.53 increased 10% compared to the adjusted EPS last year.

as we look to the future, we continue to see untapped opportunities within area and offline, which are rapidly emerging as important customer destinations

Speaker #3: The strong top line reflected a return to positive comps, which increased 4%. This was a meaningful acceleration from the 1% decrease last quarter. Improvement was made across both brands and channels.

At just under 2 billion in revenue and less than 5% market share. This indicates a significant runway for future expansion.

Underscoring, our ability to capture a much larger piece in the market as we execute our strategic initiatives.

Speaker #3: All posting positive comps, Airy's 11% comp in the third quarter was a real standout. Demand was broad-based across all categories. Growth accelerated throughout the period, which has continued into the fourth quarter where we are seeing exceptional demand so far.

Some permit for last quarter.

Strength and jeans, coupled with better results in men's were among the drivers.

Jay Schottenstein: Growth accelerated throughout the period, which has continued into Q4, where we are seeing exceptional demand so far. As we look to the future, we continue to see untapped opportunities within Aerie and OFFLINE, which are rapidly emerging as important customer destinations. At just under $2 billion in revenue and less than 5% market share, this indicates a significant runway for future expansion, underscoring our ability to capture a much larger piece of the market as we execute our strategic initiatives. American Eagle's comp growth of 1% marked a sequential improvement from last quarter. Strength in jeans, coupled with better results in men's, were among the drivers. As Jen will review, AE's business strengthened with greater in-stocks and our strongest sellers and new product flows. Positive trends have continued so far in Q4, including a terrific Thanksgiving weekend.

Growth accelerated throughout the period, which has continued into Q4, where we are seeing exceptional demand so far. As we look to the future, we continue to see untapped opportunities within Aerie and OFFLINE, which are rapidly emerging as important customer destinations. At just under $2 billion in revenue and less than 5% market share, this indicates a significant runway for future expansion, underscoring our ability to capture a much larger piece of the market as we execute our strategic initiatives. American Eagle's comp growth of 1% marked a sequential improvement from last quarter. Strength in jeans, coupled with better results in men's, were among the drivers. As Jen will review, AE's business strengthened with greater in-stocks and our strongest sellers and new product flows. Positive trends have continued so far in Q4, including a terrific Thanksgiving weekend.

Speaker #3: As we look to the future, we continue to see untapped opportunities within Airy and Offline, which are rapidly emerging as important customer destinations. At just under $2 billion in revenue and less than 5% market share, this indicates a significant runway for future expansion.

As Jen will review A's business strengths and with greater in stocks, and our strongest Sellers, and new product flows. Positive Trends have continued so far in the fourth quarter, including a terrific, Thanksgiving weekend.

Beyond product, our results have benefited from the success of our recent marketing campaigns, which have driven engagement, attracting new customers.

Speaker #3: Underscoring our ability to capture a much larger piece of the market as we execute our strategic initiatives. American Eagle's comp growth of 1% marked a sequential improvement from last quarter.

We are encouraged by the impact of the campaigns and collaborations with Cindy Sweeney and Travis Kelce and now holiday gifting with Martha Stewart.

We see measurable benefits.

Especially across our digital channels.

Speaker #3: Strengthened genes coupled with better results in men's were among the drivers. As Jen will review, AE's business strengthened with greater in-stocks, our strongest sellers, and new product flows.

Looking forward, we will build on this momentum with more exciting campaigns ahead. All in all, I'm very pleased with the progress and meaningful turnaround from the first half of of this year.

Now, the holiday season is upon us and the fourth quarter is off to an excellent start.

Speaker #3: Positive trends have continued so far in the fourth quarter, including a terrific Thanksgiving weekend. Beyond product, our results have benefited from the success of our recent marketing campaigns.

Jay Schottenstein: Beyond product, our results have benefited from the success of our recent marketing campaigns, which have driven engagement and attracted new customers. We are encouraged by the impact of the campaigns and collaborations with Sydney Sweeney and Travis Kelce, and now holiday gifting with Martha Stewart. We see measurable benefits, especially across our digital channels. Looking forward, we will build on this momentum with more exciting campaigns ahead. All in all, I'm very pleased with the progress and meaningful turnaround from the first half of this year. Now the holiday season is upon us, and Q4 is off to an excellent start. We are seeing a clear acceleration from Q3, including a record Thanksgiving weekend with strong performance across brands and channels. As a result, we are raising our Q4 outlook.

Beyond product, our results have benefited from the success of our recent marketing campaigns, which have driven engagement and attracted new customers. We are encouraged by the impact of the campaigns and collaborations with Sydney Sweeney and Travis Kelce, and now holiday gifting with Martha Stewart. We see measurable benefits, especially across our digital channels. Looking forward, we will build on this momentum with more exciting campaigns ahead. All in all, I'm very pleased with the progress and meaningful turnaround from the first half of this year. Now the holiday season is upon us, and Q4 is off to an excellent start. We are seeing a clear acceleration from Q3, including a record Thanksgiving weekend with strong performance across brands and channels. As a result, we are raising our Q4 outlook.

We are seeing a clear acceleration from the third quarter, including a record Thanksgiving weekend with strong performance across Brands and channels.

As a result, we are raising our fourth quarter Outlook.

Speaker #3: Which have driven engagement and attracted new customers. We are encouraged by the impact of the campaigns and collaborations with Cindy Sweeney and Travis Kelce. And now, holiday gifting with Martha Stewart.

We remain. Well, positioned with exciting new collections, centered on gift giving and advanced plan throughout the season to continue to Delight our customers.

Speaker #3: We see measurable benefits especially across our digital channels. Looking forward, we will build on this momentum with more exciting campaigns ahead. All in all, I'm very pleased with the progress and meaningful turnaround from the first half of this year.

Before I turn it over to Jen, I want to take a moment to acknowledge our incredible team for all their hard work and tremendous dedication.

Their efforts have fueled a meaningful Trend change across our leading brands.

Great work continues and I couldn't be more optimistic about the long-term outlook for our business.

Speaker #3: Now the holiday season is upon us, and the fourth quarter is off to an excellent start. We are seeing a clear acceleration from the third quarter, including a record Thanksgiving weekend with strong performance across brands and channels.

We look forward to driving more success as we head into 2026 and Beyond.

Driving profitable growth and enhanced value for AEO. Let me turn it over to Jen.

Speaker #3: As a result, we are raising our fourth-quarter outlook. We remain well-positioned with exciting new collections centered on gift giving and events planned throughout the season to continue to delight our customers.

Jay Schottenstein: We remain well-positioned with exciting new collections centered on gift-giving and events planned throughout the season to continue to delight our customers. Before I turn it over to Jen, I want to take a moment to acknowledge our incredible team for all their hard work and tremendous dedication. Their efforts have fueled a meaningful trend change across our leading brands. Great work continues, and I couldn't be more optimistic about the long-term outlook for our business. We look forward to driving more success as we head into 2026 and beyond, driving profitable growth and enhanced value for AEO. Let me turn it over to Jen.

We remain well-positioned with exciting new collections centered on gift-giving and events planned throughout the season to continue to delight our customers. Before I turn it over to Jen, I want to take a moment to acknowledge our incredible team for all their hard work and tremendous dedication. Their efforts have fueled a meaningful trend change across our leading brands. Great work continues, and I couldn't be more optimistic about the long-term outlook for our business. We look forward to driving more success as we head into 2026 and beyond, driving profitable growth and enhanced value for AEO. Let me turn it over to Jen.

Thank you, Jay and good afternoon everyone. I am very encouraged by the stronger performance. Across Our Brands. Marking a significant turnaround from the first half of the year.

This demonstrates, the resilience and product leadership of our portfolio of iconic brands.

Speaker #3: Before I turn it over to Jen, I want to take a moment to acknowledge our incredible team for all their hard work and tremendous dedication.

Speaker #3: Their efforts have fueled a meaningful trend change across our leading brands. Great work continues, and I couldn't be more optimistic about the long-term outlook for our business.

The increasing customer demand, which has accelerated in the fourth quarter is spanning new and existing customers fueled by a well-coordinated effort across both merchandising and marketing.

Speaker #3: We look forward to driving more success as we head into 2026 and beyond, driving profitable growth and enhanced value for AEO. Let me turn it over to.

Compelling product collections, combined with higher engagement and expanding brand, awareness are driving our performance. And the teams are executing very well leveraging, our expertise in key categories and most importantly, by listening to our customers.

Let me walk you through a few highlights in the third quarter beginning with area,

Speaker #3: Jen: Thank you, Jay, and good afternoon.

Judy Meehan: Thank you, Jay, and good afternoon, everyone. I am very encouraged by the stronger performance across our brands, marking a significant turnaround from the first half of the year. This demonstrates the resilience and product leadership of our portfolio of iconic brands. The increasing customer demand, which has accelerated in Q4, is spanning new and existing customers, fueled by a well-coordinated effort across both merchandising and marketing. Compelling product collections combined with higher engagement and expanding brand awareness are driving our performance, and the teams are executing very well, leveraging our expertise in key categories and, most importantly, by listening to our customers. Let me walk you through a few highlights in Q3, beginning with Aerie. The Aerie brand continues to exceed expectations. We achieved record revenue with Q3 comps of 11%, fueled by strength across all categories, including intimates, apparel, sleep, and OFFLINE.

Jen Foyle: Thank you, Jay, and good afternoon, everyone. I am very encouraged by the stronger performance across our brands, marking a significant turnaround from the first half of the year. This demonstrates the resilience and product leadership of our portfolio of iconic brands. The increasing customer demand, which has accelerated in Q4, is spanning new and existing customers, fueled by a well-coordinated effort across both merchandising and marketing. Compelling product collections combined with higher engagement and expanding brand awareness are driving our performance, and the teams are executing very well, leveraging our expertise in key categories and, most importantly, by listening to our customers. Let me walk you through a few highlights in Q3, beginning with Aerie. The Aerie brand continues to exceed expectations. We achieved record revenue with Q3 comps of 11%, fueled by strength across all categories, including intimates, apparel, sleep, and OFFLINE.

Speaker #2: Afternoon, everyone. I am very encouraged by the stronger performance across our brands, marking a significant turnaround from the first half of the year. This demonstrates the resilience and product leadership of our portfolio of iconic brands.

The area brand continues to exceed expectations. We achieved record Revenue with the third quarter, comps up 11% fueled by strength, across all categories, including Intimates, apparel, sleep, and offline.

Speaker #2: The increasing customer demand, which has accelerated in the fourth quarter, is spanning new and existing customers. Fueled by a well-coordinated effort across both merchandising and marketing, compelling product collections, combined with higher engagement and expanding brand awareness, are driving our performance.

Airy and offline performance has been especially impressive with a meaningful acceleration and demand since the spring season, in fact comps have strengthened with each new delivery.

Speaker #2: And the teams are executing very well, leveraging our expertise in key categories, and most importantly, by listening to our customers. Let me walk you through a few highlights in the third quarter, beginning with Airy.

The Resurgence and intimate has been very encouraging with solid growth in both bras and undies greater depth and breadth of our signature Fabrications strength and new fashion across bralettes, and bra tops, and fun prints with match backs to apparel are just a few highlights, fueling the Brand's double-digit growth.

Speaker #2: The Airy brand continues to exceed expectations. We achieved record revenue with the third quarter comps of 11%, fueled by strength across all categories including intimates, apparel, sleep, and offline.

Area apparel remained at consistently, strong driven by bottoms fleece, teas and sleep, which has emerged as a powerful growth category.

Offline by are also continues to gain. Meaningful mind share as we expand awareness and move into newer markets.

Speaker #2: Airy and Offline's performance has been especially impressive, with a meaningful acceleration in demand since the spring season. In fact, comps have strengthened with each new delivery.

Judy Meehan: Aerie and OFFLINE's performance has been especially impressive, with a meaningful acceleration in demand since the spring season. In fact, comps have strengthened with each new delivery. The resurgence in intimates has been very encouraging, with solid growth in both bras and undies. Greater depth and breadth of our signature fabrications, strength in new fashion across bralettes and bra tops, and fun prints with matchbacks to apparel are just a few highlights, fueling the brand's double-digit growth. Aerie apparel remained consistently strong, driven by bottoms, fleece, tees, and sleep, which has emerged as a powerful growth category. OFFLINE by Aerie also continues to gain meaningful mind share as we expand awareness and move into newer markets. We remain highly focused on growing the activewear segment. We are building on our signature fabrics and franchises, such as our core leggings, while also launching newness with updated fashion silhouettes.

Aerie and OFFLINE's performance has been especially impressive, with a meaningful acceleration in demand since the spring season. In fact, comps have strengthened with each new delivery. The resurgence in intimates has been very encouraging, with solid growth in both bras and undies. Greater depth and breadth of our signature fabrications, strength in new fashion across bralettes and bra tops, and fun prints with matchbacks to apparel are just a few highlights, fueling the brand's double-digit growth. Aerie apparel remained consistently strong, driven by bottoms, fleece, tees, and sleep, which has emerged as a powerful growth category. OFFLINE by Aerie also continues to gain meaningful mind share as we expand awareness and move into newer markets. We remain highly focused on growing the activewear segment. We are building on our signature fabrics and franchises, such as our core leggings, while also launching newness with updated fashion silhouettes.

Speaker #2: The resurgence in intimates has been very encouraging, with solid growth in both bras and undies. Greater depth and breadth of our signature fabrications strengthen new fashion across bralettes and bra tops, and fun prints with matchbacks to apparel are just a few highlights fueling the brand's double-digit growth.

We remain highly focused on growing the activewear segment we are building on our signature fabrics and franchises such as our core leggings while. Also launching newness, with updated fashion Silhouettes, needless to say, we are very excited about our future for both area and offline. We are well positioned for the remainder of the holiday season and continue to believe in the substantial long-term opportunities ahead.

Now moving to American Eagle, which posted a positive 1% third quarter, comp demonstrating, a meaningful improvement from the spring season.

Speaker #2: Airy apparel remained at consistently strong levels, driven by bottoms, fleece, tees, and sleep, which has emerged as a powerful growth category. Offline by Airy also continues to gain meaningful mindshare as we expand awareness and move into newer markets.

Positive demand was fueled by Trend, right new fall collection, combined with bold marketing and exciting product collaborations.

Speaker #2: We remain highly focused on growing the activewear segment. We are building on our signature fabrics and franchises, such as our core leggings, while also launching newness with updated fashion silhouettes.

And firmly position American Eagle at the center of culture are beginning to yield results.

The quarter marks an improvement in our men's business, where we saw a nice winds across tops, sweaters, fleece, graphics, and knits all areas. We have been working to recapture

Speaker #2: Needless to say, we are very excited about our future for both Airy and Offline. We are well positioned for the remainder of the holiday season and continue to believe in the substantial long-term opportunities ahead.

Judy Meehan: Needless to say, we are very excited about our future for both Aerie and OFFLINE. We are well-positioned for the remainder of the holiday season and continue to believe in the substantial long-term opportunities ahead. Now moving to American Eagle, which posted a positive 1% Q3 comp, demonstrating a meaningful improvement from the spring season. Positive demand was fueled by trend-right new fall collections combined with bold marketing and exciting product collaborations. Underpinned by our dominant denim, our strategies to reset the brand and firmly position American Eagle at the center of culture are beginning to yield results. The quarter marked an improvement in our men's business, where we saw nice wins across tops, sweaters, fleece, graphics, and knits, all areas we have been working to recapture. Bottoms provided a stable foundation, with jeans and non-denim pants trending positive.

Needless to say, we are very excited about our future for both Aerie and OFFLINE. We are well-positioned for the remainder of the holiday season and continue to believe in the substantial long-term opportunities ahead. Now moving to American Eagle, which posted a positive 1% Q3 comp, demonstrating a meaningful improvement from the spring season. Positive demand was fueled by trend-right new fall collections combined with bold marketing and exciting product collaborations. Underpinned by our dominant denim, our strategies to reset the brand and firmly position American Eagle at the center of culture are beginning to yield results. The quarter marked an improvement in our men's business, where we saw nice wins across tops, sweaters, fleece, graphics, and knits, all areas we have been working to recapture. Bottoms provided a stable foundation, with jeans and non-denim pants trending positive.

bottoms provided a stable foundation with jeans and non denim. Pants trending positive.

And favorable Trends have continued into the fourth quarter, reflecting the positive reception of our new product.

Speaker #2: Now moving to American Eagle, which posted a positive 1% third quarter comp, demonstrating a meaningful improvement from the spring season. Positive demand was fueled by trend-right new fall collection, combined with bold marketing and exciting product collaborations.

In women, although we had a very good back to school season, the quarter in total was not as strong.

Robust demand early in the period led to a number of out of stocks in some of our best-selling items.

Speaker #2: Underpinned by our dominance in denim, our strategies to reset the brand and firmly position American Eagle at the center of culture are beginning to yield results.

Speaker #2: The quarter marked an improvement in our men's business, where we saw nice wins across tops, sweaters, fleece, graphics, and knits—all areas we have been working to recapture.

Speaker #2: Bottoms provided a stable foundation, with jeans and non-denim pants trending positively. Favorable trends have continued into the fourth quarter, reflecting the positive reception of our new product.

Non denom bottoms shirts and dresses, proved more challenging while knit and fleece tops as well as jeans where positive highlights where we continue to see strong demand and importantly better in stocks late in the quarter drove positive results, which have continued into the fourth quarter. AE is a true holiday destination with amazing gift. Giving Focus combined with fun fashion and party dressing the response to date has been highly encouraging

Judy Meehan: Favorable trends have continued into Q4, reflecting the positive reception of our new product. In women's, although we had a very good back-to-school season, the quarter in total was not as strong. Robust demand early in the period led to a number of out-of-stocks in some of our best-selling items. Non-denim bottoms, shirts, and dresses proved more challenging, while knit and fleece tops, as well as jeans, were positive highlights, where we continued to see strong demand. Importantly, better in-stocks late in the quarter drove positive results, which have continued into Q4. AE is a true holiday destination with amazing gift-giving focus, combined with fun fashion and party dressing. The response to date has been highly encouraging. Now shifting gears to marketing, this fall season, American Eagle launched its largest, most impactful advertising campaigns ever, which are delivering results.

Favorable trends have continued into Q4, reflecting the positive reception of our new product. In women's, although we had a very good back-to-school season, the quarter in total was not as strong. Robust demand early in the period led to a number of out-of-stocks in some of our best-selling items. Non-denim bottoms, shirts, and dresses proved more challenging, while knit and fleece tops, as well as jeans, were positive highlights, where we continued to see strong demand. Importantly, better in-stocks late in the quarter drove positive results, which have continued into Q4. AE is a true holiday destination with amazing gift-giving focus, combined with fun fashion and party dressing. The response to date has been highly encouraging. Now shifting gears to marketing, this fall season, American Eagle launched its largest, most impactful advertising campaigns ever, which are delivering results.

Now, shifting gears to marketing The Fall season American Eagle launched. Its largest most impactful advertising campaigns ever which are delivering results.

Speaker #2: In women's, although we had a very good back-to-school season, the quarter in total was not as strong. Robust demand early in the period led to a number of out-of-stocks in some of our best-selling items.

By collaborating with high-profile Partners who are defining culture. We are attracting more customers and have more eyes on the brand than ever before.

Speaker #2: Non-denim bottoms, shirts, and dresses proved more challenging. While knit and fleece tops, as well as jeans, were positive highlights, where we continue to see strong demand.

Combined the Sydney Sweeney and Travis Kelce Partnerships have garnered more than 44 billion impressions.

Total customer counts are up across Brands and Customer Loyalty grew 4% in the quarter.

Speaker #2: And importantly, better results in stocks late in the quarter drove positive outcomes that have continued into the fourth quarter. AE is a true holiday destination with an amazing gift-giving focus, combined with fun fashion and party dressing.

AE is clearly building, long-term awareness and desirability and has captured the attention of both new and existing customers.

Speaker #2: The response to date has been highly encouraging. Now, shifting gears to marketing. This fall season, American Eagle launched its largest, most impactful advertising campaign ever, which is delivering results.

Traffic has also increased consistently throughout the quarter, which is most evident within our digital selling channels that include both AE and Aerie.

Speaker #2: By collaborating with high-profile partners who are defining culture, we are attracting more customers and have more eyes on the brand than ever before. Combined, the Sydney Sweeney and Travis Kelce partnerships have garnered more than 44 billion impressions.

Judy Meehan: By collaborating with high-profile partners who are defining culture, we are attracting more customers and have more eyes on the brand than ever before. Combined, the Sydney Sweeney and Travis Kelce partnerships have garnered more than 44 billion impressions. Total customer counts are up across brands, and customer loyalty grew 4% in Q4. AE is clearly building long-term awareness and desirability, and has captured the attention of both new and existing customers. Traffic has also increased consistently throughout the quarter, which is most evident within our digital selling channels that include both AE and Aerie. Although it's still early days of our renewed marketing strategy, we know that having the right talent amplifies our brand and product at key moments. We are very encouraged by our progress and expect to continue fueling brand excitement into 2026 and beyond.

By collaborating with high-profile partners who are defining culture, we are attracting more customers and have more eyes on the brand than ever before. Combined, the Sydney Sweeney and Travis Kelce partnerships have garnered more than 44 billion impressions. Total customer counts are up across brands, and customer loyalty grew 4% in Q4. AE is clearly building long-term awareness and desirability, and has captured the attention of both new and existing customers. Traffic has also increased consistently throughout the quarter, which is most evident within our digital selling channels that include both AE and Aerie. Although it's still early days of our renewed marketing strategy, we know that having the right talent amplifies our brand and product at key moments. We are very encouraged by our progress and expect to continue fueling brand excitement into 2026 and beyond.

Although it's still early days of our renewed marketing strategy. We know that having the right Talent, amplifies our brand and product. At Key moments, we are very encouraged by our progress and expect to continue fueling brand excitement into 2026 and Beyond

Our recent holiday campaign with Martha Stewart is yet. Another example of how we are creating fun moments to Delight. Our customers, while reinforcing our position as a go-to, gifting destination

Speaker #2: Total customer counts are up across brands, and customer loyalty grew 4% in the quarter. AE is clearly building long-term awareness and desirability and has captured the attention of both new and existing customers.

Speaker #2: Traffic has also increased consistently throughout the quarter, which is most evident within our digital selling channels that include both AE and Airy. Although it's still early days, with our renewed marketing strategy, we know that having the right talent amplifies our brand and product at key moments.

The holiday seasons in full swing. And as Jay mentioned, we are encouraged with the results so far. We are heads down and focused on the rest of the year to deliver long-term sales and bottom line growth. Thanks to our amazing teams and thanks to all of you for your ongoing support. I wish everyone a happy and healthy holiday season and with that, I'll turn the call over to Mike.

Thanks. Good afternoon, everyone.

I'm pleased to see the study progressed throughout our business. This led to strong revenue and profit above our expectations in the third quarter.

Speaker #2: We are very encouraged by our progress and expect to continue fueling brand excitement into 2026 and beyond. Our recent holiday campaign with Martha Stewart is yet another example of how we are creating fun moments to delight our customers while reinforcing our position as the go-to gifting destination.

Judy Meehan: Our recent holiday campaign with Martha Stewart is yet another example of how we are creating fun moments to delight our customers while reinforcing our position as the go-to gifting destination. The holiday season's in full swing, and as Jay mentioned, we are encouraged with the results so far. We are heads down and focused on the rest of the year to deliver long-term sales and bottom-line growth. Thanks to our amazing teams, and thanks to all of you for your ongoing support. I wish everyone a happy and healthy holiday season. And with that, I'll turn the call over to Mike.

Our recent holiday campaign with Martha Stewart is yet another example of how we are creating fun moments to delight our customers while reinforcing our position as the go-to gifting destination. The holiday season's in full swing, and as Jay mentioned, we are encouraged with the results so far. We are heads down and focused on the rest of the year to deliver long-term sales and bottom-line growth. Thanks to our amazing teams, and thanks to all of you for your ongoing support. I wish everyone a happy and healthy holiday season. And with that, I'll turn the call over to Mike.

in addition to generating a meaningful Topline Improvement, we successfully controlled costs created efficiencies manage promotions and navigated through a highly Dynamic sourcing environment minimizing the impact of tariffs,

Validated revenue of 1.36 billion increased 6% to last year.

Speaker #2: The holiday season's in full swing, and as Jay mentioned, we are encouraged by the results so far. We are heads down and focused on the rest of the year to deliver long-term sales and bottom-line growth.

Fueled by comparable sales, growth of 4% with area up, 11% and AE up 1%.

We saw growth in transactions, across Brands driven by higher traffic, the average unit retail price was flat to last year,

Speaker #2: Thanks to our amazing teams, and thanks to all of you for your ongoing support. I wish everyone a happy and healthy holiday season. And with that, I'll turn the call over to.

Gross profit dollars of 552 million increased 5% reflecting higher demand.

Speaker #2: Mike. Thanks.

The gross margin declined, 40, basis points to 40.5% compared to 40.9% last year.

Jay Schottenstein: Thanks, and good afternoon, everyone. I'm pleased to see the steady progress throughout our business, which led to strong revenue and profit above our expectations in Q4. In addition to generating a meaningful top-line improvement, we successfully controlled costs, created efficiencies, managed promotions, and navigated through a highly dynamic sourcing environment, minimizing the impact of tariffs. Holiday revenue of $1.36 billion increased 6% to last year, fueled by comparable sales growth of 4%, with Aerie up 11% and AE up 1%. We saw growth in transactions across brands driven by higher traffic. The average unit retail price was flat to last year. Gross profit dollars of $552 million increased 5%, reflecting higher demand. The gross margin declined 40 basis points to 40.5%, compared to 40.9% last year. Net tariff pressure was, as expected, at $20 million, or 150 basis points.

Mike Mathias: Thanks, and good afternoon, everyone. I'm pleased to see the steady progress throughout our business, which led to strong revenue and profit above our expectations in Q4. In addition to generating a meaningful top-line improvement, we successfully controlled costs, created efficiencies, managed promotions, and navigated through a highly dynamic sourcing environment, minimizing the impact of tariffs. Holiday revenue of $1.36 billion increased 6% to last year, fueled by comparable sales growth of 4%, with Aerie up 11% and AE up 1%. We saw growth in transactions across brands driven by higher traffic. The average unit retail price was flat to last year. Gross profit dollars of $552 million increased 5%, reflecting higher demand. The gross margin declined 40 basis points to 40.5%, compared to 40.9% last year. Net tariff pressure was, as expected, at $20 million, or 150 basis points.

Speaker #1: Good afternoon, everyone. I'm pleased to see the steady progress throughout our business, which led to strong revenue and profit above our expectations in the third quarter.

Net, tariff pressure was as expected at 20 million or 150 basis points.

Speaker #1: In addition to generating a meaningful top-line improvement, we successfully controlled costs, created efficiencies, managed promotions, and navigated through a highly dynamic sourcing environment, minimizing the impact of tariffs.

Higher markdowns were, largely offset by positive sales growth and lower non-tariff costs including favorability and Freight.

Buying occupancy and warehousing leverage, 20 basis points due to higher sales and a continued focus on operational improvements.

Speaker #1: Validated revenue of $1.36 billion increased 6% compared to last year, fueled by comparable sales growth of 4%, with Airy up 11% and AE up 1%.

For example, we drove lower cost per shipment within our Direct business which has been an area of ongoing Focus.

Sta increased 10% due to investment in advertising as previously discussed.

Speaker #1: We saw growth in transactions across brands, driven by higher traffic. The average unit retail price was flat to last year. Gross profit dollars of $552 million increased 5%, reflecting higher demand.

With our focus on long-term brand benefits. The campaigns are already delivering results and helping to advance our goal of expanding our reach and generating growth across brands.

The balance of expense is leveraged to reflecting our ongoing cost Management program.

Speaker #1: The gross margin declined 40 basis points to 40.5% compared to 40.9% last year. Net tariff pressure was as expected at $20 million or 150 basis points.

Operating income of 113 million was above our guidance of 95 to 100 million driven by stronger than expected demand.

Speaker #1: Markdowns were largely offset by positive sales growth and lower non-tariff costs, including favorability in freight. Buying occupancy and warehousing leveraged 20 basis points due to higher sales and a continued focus on operational improvements.

Jay Schottenstein: Higher markdowns were largely offset by positive sales growth and lower non-tariff costs, including favorability in freight. Buying, occupancy, and warehousing leveraged 20 basis points due to higher sales and a continued focus on operational improvements. For example, we drove lower cost per shipment within our direct business, which has been an area of ongoing focus. SG&A increased 10% due to investment in advertising, as previously discussed. With our focus on long-term brand benefits, the campaigns are already delivering results and helping to advance our goal of expanding our reach and generating growth across brands. The balance of expenses leveraged, reflecting our ongoing cost management program. Operating income of $113 million was above our guidance of $95 to $100 million, driven by stronger-than-expected demand. The operating margin of 8.3% declined from an adjusted margin of 9.6% last year. Consolidated ending inventory cost was up 11%, with units up 8%.

Higher markdowns were largely offset by positive sales growth and lower non-tariff costs, including favorability in freight. Buying, occupancy, and warehousing leveraged 20 basis points due to higher sales and a continued focus on operational improvements. For example, we drove lower cost per shipment within our direct business, which has been an area of ongoing focus. SG&A increased 10% due to investment in advertising, as previously discussed. With our focus on long-term brand benefits, the campaigns are already delivering results and helping to advance our goal of expanding our reach and generating growth across brands. The balance of expenses leveraged, reflecting our ongoing cost management program. Operating income of $113 million was above our guidance of $95 to $100 million, driven by stronger-than-expected demand. The operating margin of 8.3% declined from an adjusted margin of 9.6% last year. Consolidated ending inventory cost was up 11%, with units up 8%.

The operating margin of 8.3% declined from an adjusted margin of 9.6% last year.

Speaker #1: For example, we drove lower cost per shipment within our direct business, which has been an area of ongoing focus. STNA increased 10% due to investment in advertising as previously discussed.

Units of 8% inventory is balanced across Brands reflecting better in stocks for American Eagle jeans, new store openings in the demand acceleration at area and offline.

The increase in cost includes the impact of tariffs.

third quarter, capex totaled, 70 million dollars, bringing year to date, spend to 202 million

Speaker #1: With our focus on long-term brand benefits, the campaigns are already delivering results and helping to advance our goal of expanding our reach and generating growth across brands.

We continue to expect capex of approximately 275 million for the year.

As a reminder, this includes a 1-time spend of about 40 million dollars to relocate, our New York Design Center.

Speaker #1: The balance of expenses leveraged reflects our ongoing cost management program. Operating income of $113 million was above our guidance of $95 to $100 million, driven by stronger than expected demand.

As we previously disclosed.

We're on track to open 22 area and 26 offline stores which are coming out of the gate quite strong.

We'll complete about 50 AE store remodels with full upgrades to our modern design.

Speaker #1: The operating margin of 8.3% declined from an adjusted margin of 9.6% last year. Consolidated ending inventory cost was up 11%, with units up 8%.

A few great examples of recent store upgrades are the Aventura Mall and Sawgrass Mills in Miami and our new Soho location in New York City.

Speaker #1: Inventory is balanced across brands, reflecting better in stocks for American Eagle jeans, new store openings, and the demand acceleration at Airy and offline. The increase in cost includes the impact of tariffs.

Jay Schottenstein: Inventories balanced across brands, reflecting better in-stocks for American Eagle jeans, new store openings, and the demand acceleration at Aerie and OFFLINE. The increase in costs includes the impact of tariffs. Q3 CapEx totaled $70 million, bringing year-to-date spend to $202 million. We continue to expect CapEx of approximately $275 million for the year. As a reminder, this includes a one-time spend of about $40 million to relocate our New York Design Center, as we previously disclosed. We're on track to open 22 Aerie and 26 OFFLINE stores, which are coming out of the gate quite strong. We'll complete about 50 AE store remodels with full upgrades to our modern design. A few great examples of recent store upgrades are the Aventura Mall, Sawgrass Mills in Miami, and our new Soho location in New York City.

Inventories balanced across brands, reflecting better in-stocks for American Eagle jeans, new store openings, and the demand acceleration at Aerie and OFFLINE. The increase in costs includes the impact of tariffs. Q3 CapEx totaled $70 million, bringing year-to-date spend to $202 million. We continue to expect CapEx of approximately $275 million for the year. As a reminder, this includes a one-time spend of about $40 million to relocate our New York Design Center, as we previously disclosed. We're on track to open 22 Aerie and 26 OFFLINE stores, which are coming out of the gate quite strong. We'll complete about 50 AE store remodels with full upgrades to our modern design. A few great examples of recent store upgrades are the Aventura Mall, Sawgrass Mills in Miami, and our new Soho location in New York City.

All of these A+ stores are among our best. And we want to ensure the customer experience is unmatched.

The upgraded Footprints have allowed us to showcase our signature Brands aeer and offline.

We're utilizing new technologies to elevate the shopping journey, and create a cohesive, and modern retail experience.

Speaker #1: Third quarter CapEx totaled $70 million, bringing year-to-date spend to $202 million. We continue to expect CapEx of approximately $275 million for the year.

Overall, our remodeling program is generating comps nicely above the average.

Speaker #1: As a reminder, this includes a one-time spend of about $40 million to relocate our New York design center. As we previously disclosed, we're on track to open 22 Airy and 26 offline stores, which are coming out of the gate quite strong.

As we continue to position, our Fleet for profitable growth, we're also on track to close about 35 lower productivity, AE stores.

Our Capital allocation priorities remain unchanged and we're focused on prudently investing in growth to continue to build Our Brands. While returning excess cash to shareholders through dividends, and share purchases.

Speaker #1: We'll complete about 50 AE store remodels with full upgrades to our modern design. A few great examples of recent store upgrades are the Aventura Mall and Sawgrass Mills in Miami, and our new Soho location in New York City.

As a reminder, during the first half of this year, Sherry purchases, total 231 million, year-to-date, dividend payments of total 64 million.

Speaker #1: All of these A-plus stores are among our best, and we want to ensure the customer experience is unmatched. The upgraded footprints have allowed us to showcase our signature brands, AE, Aerie, and Offline.

Jay Schottenstein: All of these A-plus stores are among our best, and we want to ensure the customer experience is unmatched. The upgraded footprints have allowed us to showcase our signature brands, AE, Aerie, and OFFLINE. We're utilizing new technologies to elevate the shopping journey and create a cohesive and modern retail experience. Overall, our remodeling program is generating comps nicely above the average. As we continue to position our fleet for profitable growth, we're also on track to close about 35 lower productivity AE stores. Our capital allocation priorities remain unchanged, and we're focused on prudently investing in growth to continue to build our brands while returning excess cash to shareholders through dividends and share repurchases. As a reminder, during the first half of this year, share repurchases totaled $231 million, and year-to-date dividend payments have totaled $64 million.

All of these A-plus stores are among our best, and we want to ensure the customer experience is unmatched. The upgraded footprints have allowed us to showcase our signature brands, AE, Aerie, and OFFLINE. We're utilizing new technologies to elevate the shopping journey and create a cohesive and modern retail experience. Overall, our remodeling program is generating comps nicely above the average. As we continue to position our fleet for profitable growth, we're also on track to close about 35 lower productivity AE stores. Our capital allocation priorities remain unchanged, and we're focused on prudently investing in growth to continue to build our brands while returning excess cash to shareholders through dividends and share repurchases. As a reminder, during the first half of this year, share repurchases totaled $231 million, and year-to-date dividend payments have totaled $64 million.

We have a strong balance sheet and then the period with cash of 113 million and total liquidity or approximately 500660 million.

Speaker #1: We're utilizing new technologies to elevate the shopping journey and create a cohesive and modern retail experience. Overall, our remodeling program is generating comps nicely above the average.

Now turning to our Outlook, the fourth quarter is off to an excellent start. As a team noted we're encouraged by the broad-based strength across Brands and channels with particular strengths and area and offline.

Our inventory and product offerings are well, positioned to deliver a successful holiday season. And we're all focused on achieving a strong fourth quarter result.

Speaker #1: we continue to position our fleet for profitable As growth, we're also on track to close about 35 lower productivity AE stores. Our capital allocation priorities remain unchanged, and we're focused on prudently investing in growth to continue to build our brands, while returning excess cash to shareholders through dividends and share repurchases.

Based on quarter date sales Trends and the recognition that we've important selling weeks, still ahead. We are raising our fourth quarter. Operating income guidance to a range of 155 to 160 million based on comp sales growth of 89% with similar growth in total revenue.

Speaker #1: As a reminder, during the first half of this year, share repurchases totaled 231 million, and year-to-date dividend payments have totaled 64 million. We have a strong balance sheet and ended the period with cash of $113 million and total liquidity of approximately $560 million.

Guidance includes approximately $50 million in incremental tariff costs.

Jay Schottenstein: We have a strong balance sheet and ended the period with cash of $113 million and total liquidity of approximately $560 million. Now turning to our outlook, Q4 is off to an excellent start. As the team noted, we're encouraged by the broad-based strength across brands and channels, with particular strength in Aerie and OFFLINE. Our inventory and product offerings are well-positioned to deliver a successful holiday season, and we're all focused on achieving a strong Q4 result. Based on Q4 sales trends and the recognition that we have important selling weeks still ahead, we are raising our Q4 operating income guidance to a range of $155 to $160 million, based on comp sales growth of 8% to 9%, with similar growth in total revenue. Guidance includes approximately $50 million in incremental tariff costs.

We have a strong balance sheet and ended the period with cash of $113 million and total liquidity of approximately $560 million. Now turning to our outlook, Q4 is off to an excellent start. As the team noted, we're encouraged by the broad-based strength across brands and channels, with particular strength in Aerie and OFFLINE. Our inventory and product offerings are well-positioned to deliver a successful holiday season, and we're all focused on achieving a strong Q4 result. Based on Q4 sales trends and the recognition that we have important selling weeks still ahead, we are raising our Q4 operating income guidance to a range of $155 to $160 million, based on comp sales growth of 8% to 9%, with similar growth in total revenue. Guidance includes approximately $50 million in incremental tariff costs.

Buying occupancy and warehousing costs are expected to increase due to new store growth for area and offline increased digital penetration.

STNA is expected to increase in the low to mid single digits driven by investments in advertising.

Speaker #1: Now turning to our outlook. The fourth quarter is off to an excellent start. As the team noted, we're encouraged by the broad-based strength across brands and channels, with particular strength in Airy and offline.

Given the Topline strength, we expect both B and sgna to leverage in the fourth quarter.

The tax rate is estimated to be approximately 28% and the weighted average share count will be roughly 173 million.

Speaker #1: Our inventory and product offerings are well positioned to deliver a successful holiday season, and we're all focused on achieving a strong fourth quarter result.

To wrap up our prepared remarks. Clearly, we're very encouraged by the progress made across our brands.

Speaker #1: Based on quarter-to-date sales trends and the recognition that we have important selling weeks still ahead, we are raising our fourth quarter operating income guidance to a range of $155 million to $160 million, based on comp sales growth of 8% to 9%, with similar growth in total revenue.

We're highly focused on delivering their remainder of the Year. Driving strong profit flow through and sustaining this momentum into 2026.

Now we'll open up the call for questions.

Speaker #1: Guidance includes approximately $50 million in incremental tariff costs. Buying occupancy and warehousing costs are expected to increase due to new store growth for Airy and offline, as well as increased digital penetration.

Jay Schottenstein: Buying, occupancy, and warehousing costs are expected to increase due to new store growth for Aerie and OFFLINE, and increased digital penetration. SG&A is expected to increase in the low to mid-single digits, driven by investments in advertising. Given the top-line strength, we expect both BOW and SG&A to leverage in Q4. The tax rate is estimated to be approximately 28%, and the weighted average share count will be roughly 173 million. To wrap up our prepared remarks, clearly, we're very encouraged by the progress made across our brands. We're highly focused on delivering the remainder of the year, driving strong profit flow-through, and sustaining this momentum into 2026. Now we'll open up the call for questions.

Buying, occupancy, and warehousing costs are expected to increase due to new store growth for Aerie and OFFLINE, and increased digital penetration. SG&A is expected to increase in the low to mid-single digits, driven by investments in advertising. Given the top-line strength, we expect both BOW and SG&A to leverage in Q4. The tax rate is estimated to be approximately 28%, and the weighted average share count will be roughly 173 million. To wrap up our prepared remarks, clearly, we're very encouraged by the progress made across our brands. We're highly focused on delivering the remainder of the year, driving strong profit flow-through, and sustaining this momentum into 2026. Now we'll open up the call for questions.

We will now begin the question and answer session to ask a question. You may press star then 1 on your telephone keypad. If you're using a speaker-phone, please pick up your handset before pressing the keys.

Speaker #1: STNA is expected to increase in the low to mid-single digits, driven by investments in advertising. Given the top-line strength, we expect both BOW and STNA to leverage in the fourth quarter.

2 withdraw, your questions, please press start and then 2. Also, please let yourself to 1 question and 1. Follow-up 3 Q to ask additional questions.

Speaker #1: The tax rate is estimated to be approximately 28%, and the weighted average share count will be roughly 173 million. To wrap up our prepared remarks, clearly we're very encouraged by the progress made across our brands.

The first question comes from J. Soul with UBS. Please go ahead.

Speaker #1: We're highly focused on delivering the remainder of the year, driving strong profit flow-through, and sustaining this momentum into 2026. Now, we'll open up the call for questions.

Speaker #2: We will now begin the question-and-answer session. To ask a question, you may press star, then one on your telephone keypad. If you're using a speakerphone, please pick up your handset before pressing the keys.

Operator: We will now begin the question and answer session. To ask a question, you may press Star, then 1 on your telephone keypad. If you're using a speakerphone, please pick up your handset before pressing the keys. To withdraw your question, please press Star and then 2. Also, please limit yourself to one question and one follow-up. Requeue to ask additional questions. The first question comes from Jay Sole with UBS. Please go ahead.

Great, thanks so much. Uh, my first question. Um, I think it's for Mike, you know, you talked about the acceleration fourth quarter to date, um, and you raised the guidance, the comp, guys, I think you said 8 to 9, that's pretty significant from, where you ended Q3. Could you just talk about, you know, where your trending core today to be able to, to guide to that level and and and what's Driven the acceleration? And then maybe for Jen, you mentioned strength and denim. If you could elaborate a little bit, if if people aren't wearing skinny and I'm like, they were like, what are the new Silhouettes that are working and and how durable are those Trends? Do you think the trends that you're seeing can last, you know, well into 2026 or or Beyond? And if you can if you can help us on that, that'd be great. Thank you.

Speaker #2: To withdraw your question, please press star and then two. Also, please limit yourself to one question and one follow-up, three cue to ask additional questions.

Speaker #2: The first question comes from Jay Schottenstein with UBS. Please go ahead.

Yeah. Thanks Jack. I can talk uh, talk you through the guidance. So the 8 to 9%, confident increase includes uh nice improvements or acceleration for both Brands quarter to date from what we just reported in Q3.

Speaker #3: Great. Thanks so much. My first question, I think, is for Mike. You know, you talked about the acceleration in Q4 to date, and you raised the guidance—the comp guidance. I think you said 8 to 9.

Jay Sole: Great. Thanks so much. My first question, I think, is for Mike. You talked about the acceleration Q4 to date, and you raised the guidance, the comp guidance. I think you said 8% to 9%. It's pretty significant from where you ended Q3. Can you just talk about where you're trending Q4 to date to be able to guide to that level, and what's driven the acceleration? And maybe for Jen, you mentioned strength in denim. If you could elaborate a little bit, if people aren't wearing skinny denim like they were, what are the new silhouettes that are working, and how durable are those trends? Do you think the trends that you're seeing can last well into 2026 or beyond? And if you can help us on that, that'd be great. Thank you.

Um, I would say if uh, you want to break it down by brand, we'd be looking for the AE brand to be in the low to mid single digits.

Speaker #3: That's pretty significant from where you ended Q3. Can you just talk about where your trending quarter to date to be able to guide to that level?

And area in the High Teens um mixing to that 8 to 9% calm and both brands are ahead of that quarter to date.

But we know we've got uh, you know, some big weeks ahead of us only about half the quarter in

Speaker #3: And what's driven the acceleration? And maybe for Jen, you mentioned strength in denim. If you could elaborate a little bit: if people aren't wearing skinny denim like they were, what are the new silhouettes that are working?

and uh,

Speaker #3: And how durable are those trends? Do you think the trends that you're seeing can last well into 2026 or beyond? If you can help us with that, that'd be great.

Speaker #3: Thank

Speaker #3: Thank you. Yeah.

Mike Mathias: Yeah. Thanks, Jay. I can talk you through the guidance. So the 8% to 9% comp increase includes a nice improvement or acceleration for both brands Q4 to date from what we just reported in Q3. I would say, if you want to break it down by brand, we'd be looking for the AE brand to be in the low to mid-single digits and Aerie in the high teens, mixing to that 8% to 9% comp. And both brands are ahead of that Q4 to date, but we know we've got some big weeks ahead of us, only about half a quarter in. But definitely pleased with how November turned out and where we are Q4 to date through the Thanksgiving weekend.

Speaker #4: Thanks, Jay. I can talk you through the guidance. So the 8% to 9% comp increase includes a nice improvement or acceleration for both brands quarter-to-date from what we just reported in Q3.

Speaker #4: I would say if one to break it down by brand, we'd be looking for the AE brand to be in the low to mid-single digits, and Airy in the high teens.

Speaker #4: Mixing to that 8% to 9% comp in both brands are ahead of that quarter-to-date. But we know we've got some big weeks ahead of us—only about half a quarter in.

Speaker #4: I am definitely pleased with how November turned out and where we are quarter-to-date through Thanksgiving.

Speaker #4: weekend. Yeah.

Jen Foyle: Yeah. And denim has been very strong. In fact, particularly in women's, we saw acceleration throughout the quarter, getting into the back half of Q3 and into Black Friday. It's been our number one Black Friday as far as denim is concerned. The jeans are certainly winning for us. And as you know, that's our key competency business. Look, silhouettes are changing faster than ever. And I always reemphasize that our teams strategically do just extensive testing and scaling. And we did have some out-of-stocks, particularly in women's in Q3. Sydney Sweeney certainly accelerated some of that, and we needed to move swiftly to get back into business. And I like what we're seeing at the end of Q3 and headed into Q4 with the denim business. So we're excited.

Speaker #5: And denim has been very strong. In fact, particularly in women's, we saw acceleration throughout the quarter. Getting into the back half of Q3 and into Black Friday, it's been our number one Black Friday as far as denim is concerned.

Denim has been very strong. In fact, particularly in women's, we saw acceleration throughout the quarter, um, getting into the back half of Q3 and into black. It's been our number 1 Black Friday. As far as denim, uh, is concerned, um, the jeans are certainly, um, winning for us. And as you know, that's our key competency business. Look, silhouette Silhouettes are changing faster than ever. And, um, you know, I always re-emphasize that our teams strategically do. Um, just extensive testing, um, and scaling and um, you know, we did have some out of stocks particularly in women's in Q3 and N Sweeney. Certainly accelerated, some of that, um, and we needed to move swiftly, uh, to get back into business and, um, I like what we're seeing, uh, you know, at the end of Q3 and headed into Q4, um, with the denim business, so we're excited.

Got it.

And the next question comes from Matthew boss of JP Morgan. Please go ahead.

Speaker #5: The jeans are certainly winning for us. And as you know, that's our key competency business. Look, silhouettes are changing faster than ever, and I always re-emphasize that our teams strategically do extensive testing and scaling. We did have some out-of-stock, particularly in women's, in Q3.

Great, thanks. And congrats on the Improvement.

Thanks, Matt. So, um, so Jen at at area, uh, maybe if we could dig a Little Deeper, if could you speak to the drivers of the same store sales improvement over the past 2, Straight quarters and with that, I guess maybe. Could you break into customer acquisition trends that you're seeing and initiatives in place to sustain double digit comp growth in your view,

Speaker #5: Nice, we certainly needed to accelerate some of that, and we needed to move swiftly to get back into business. I like what we're seeing at the end of Q3 and headed into Q4 with the denim business.

Speaker #5: So we're

Speaker #5: excited. Got

Speaker #3: Got it.

Operator: Got it. The next question comes from Matthew Boss with JPMorgan. Please go ahead.

Speaker #2: And the next question comes from Matthew Boss with JP Morgan. Please go ahead.

Speaker #2: ahead. Great.

Matthew Boss: Great. Thanks and congrats on the improvement.

Speaker #6: Thanks. And congrats on the

Speaker #6: Improvement. Thanks, Matt. So, Jen, at Airy, maybe if we could dig a little deeper. Could you speak to the drivers of the same-store sales improvement over the past two straight quarters?

Mike Mathias: Thanks, Matt.

Matthew Boss: So Jen, at Aerie, maybe if we could dig a little deeper, could you speak to the drivers of the same-store sales improvement over the past two straight quarters? And with that, I guess maybe could you break into customer acquisition trends that you're seeing and initiatives in place to sustain double-digit comp growth in your view?

Speaker #6: And with that, I guess maybe could you break into customer acquisition trends that you're seeing and initiatives in place to sustain double-digit comp growth in your view?

Speaker #5: Yeah, it's certainly exciting to see Airy back on track. Coming off of Q1, we definitely needed to pivot as a team. We really hunkered down and thought about our strategy.

Jen Foyle: Yeah. It's certainly exciting to see Aerie back on track. Coming off of Q1, we definitely needed to pivot as a team, and we really hunkered down and really thought about our strategy and what we needed to get back to win. Not only coming from our core competency businesses, which all accelerated and have been accelerating starting in Q3 into Q4, but also there's new businesses in town. Sleep is doing quite well for us, and it's proving to be a year-round business for us, so a new category there. So obviously, we have OFFLINE too, which is our secondary business coming off of Aerie, and that business is proven. Where you're hearing some deceleration in the athletic apparel areas, we're holding our own, and our leggings are still tried and true and winning for us. The customer acquisition has been strong. Our customers are spending more.

Um, yeah, it's it's certainly exciting to see Arie back on track. Um, you know, coming up a q1. We definitely needed to Pivot as a team, um, and we really hunkered down and really, um, you know, thought about our strategy and what we needed to get back to win. Um, not only coming from our core competency businesses, which all accelerated and have been accelerating, um, starting in Q3 and Q4, but also, um, there's new businesses in town, you know, sleep is doing quite well for us, um, and it's proving to be a year round business for us. So, a new category there. Um, so obviously we have offline too, which is, um, you know, our secondary business, um, coming off of area. And that business is proven, um, where you're hearing some Dell and that the Athletic Apparel areas. Um, we're holding our own, um, and our leggings are still tried and true and winning for us. Uh, the customer acquisition has been strong. Our customers are spending more. Um, we're seeing

Speaker #5: And what we needed to get back to win. Not only coming from our core competency businesses, which all accelerated and have been accelerating starting in Q3 into Q4, but also there's new businesses in town.

Speaker #5: Sleep is doing quite well for us, and it's proving to be a year-round business for us. So a new category there. So obviously, we have offline too, which is our secondary business coming off of Airy.

Speaker #5: And that business is proven. While you're hearing some deselling in the athletic apparel area, we're holding our own, and our leggings are still tried and true and winning for us.

Speaker #5: The customer acquisition has been strong. Our customers are spending more. We're seeing even so. So, coming off of Q3, as we head into Q4, our acquisition has actually been accelerating.

Jen Foyle: We're seeing, even so. So coming off of Q3, as we head into Q4, our acquisition has been accelerating. Last week was an incredible week for Aerie, where we saw a huge amount of customer acquisition. So we are taking advantage of our traffic. We're winning our customers. I think we're showing up really proudly. We launched our new 100% real campaign, which is tied to our core competency of how we launch this business, what our platform is. And it's talking to our community. It's speaking to her. It's playing off of no air brushing our models. And now we've leveraged some of that into the AI world and thinking about how we approach that differently. So Aerie does things differently. We always think into the white space that sometimes can be scary, but we're so proud of what we do in this brand.

We're seeing, even so. So coming off of Q3, as we head into Q4, our acquisition has been accelerating. Last week was an incredible week for Aerie, where we saw a huge amount of customer acquisition. So we are taking advantage of our traffic. We're winning our customers. I think we're showing up really proudly. We launched our new 100% real campaign, which is tied to our core competency of how we launch this business, what our platform is. And it's talking to our community. It's speaking to her. It's playing off of no air brushing our models. And now we've leveraged some of that into the AI world and thinking about how we approach that differently. So Aerie does things differently. We always think into the white space that sometimes can be scary, but we're so proud of what we do in this brand.

Even so, so coming off of Q3 as we head into Q4 they're actually our acquisition has been accelerating last week was an incredible week for Arie where we saw a huge amount of customer acquisition. So we are taking advantage of our traffic, we're winning our customers. Um, I think we're showing up really proudly. Um, you know, we launched our new 100% real Campaign which is um, tied to our, our core competency of how we launched this business, what our platform is and it's talking to our community, it's speaking to her it's um playing off of no. Airbrushing our, you know, our models and now we've leveraged some of that into the AI world and thinking about how we approach that differently. Um, so Arie does things differently. We always think, you know. Um, you know, into the white space that sometimes uh, can be scary but we're so proud of um, what?

Speaker #5: Last week was an incredible week for Airy where we saw a huge amount of customer acquisition. So we are taking advantage of our traffic.

What we do in this brand and I think the team is doing an incredible job leveraging. Our community amplifying marketing, but also it's 100% about our product.

Speaker #5: We're winning our customers. I think we're showing up really proudly. We launched our new 100% Real campaign, which is tied to our core competency of how we launched this business, what our platform is, and it's talking to our community; it's speaking to her, it's playing off of no airbrushing our models.

What we do every day is about our product and winning our customer.

That's great. And then Mike um could you speak to expectations for markdowns in the fourth quarter, relative to the third quarter, just overall health of your inventory and how best to think about gross margin levers, remaining into next year.

Speaker #5: And now we've leveraged some of that into the AI world and thinking about how we approach that differently. So Airy does things think into differently.

Speaker #5: The white space that sometimes can be. We always think of what we do in this brand, and I think the team is doing an incredible job leveraging our community, amplifying marketing, but also, it's 100% about our product.

Jen Foyle: And I think the team is doing an incredible job leveraging our community, amplifying marketing, but also it's 100% about our product. What we do every day is about our product and winning our customer.

And I think the team is doing an incredible job leveraging our community, amplifying marketing, but also it's 100% about our product. What we do every day is about our product and winning our customer.

I can start with inventory, Matt. I mean, we're very pleased and comfortable. We're with the the plus 11 total dollars. Plus 8 units. It's positioned. Well, to continue to fuel this area and offline Trends. Um, we definitely is Jen talked about, in the, in her remarks kind of resetting. Some denim inventory to make sure we're continue to be in stock and, um, you know, don't miss a sale within the AE jeans category, um, and again, that plus 11 costs and includes the impact of tariffs along with, um, you know, just supporting those businesses.

Speaker #5: What we do every day is about our product and winning our customer.

Speaker #6: That's great. And then, Mike, could you speak to expectations for markdowns in the fourth quarter relative to the third quarter, just overall health of your inventory?

Matthew Boss: That's great. And then, Mike, could you speak to expectations for markdowns in the Q4 relative to Q3, just overall health of your inventory, and how best to think about gross margin levers remaining into next year?

Speaker #6: And how best to think about gross margin levers remaining into next year?

Speaker #4: I can start with inventory, Matt. I mean, we're very pleased and comfortable. We're with the plus 11 in total dollars, plus 8 in units.

Mike Mathias: I can start with inventory, Matt. I mean, we're very pleased and comfortable. We're with the +11 in total dollars, +8 in units. It's positioned well to continue to fuel this Aerie and OFFLINE trend. We definitely, as Jen talked about in her remarks, kind of resetting some denim inventory to make sure we're continuing to be in stock and don't miss a sale within the AE jeans category. And again, that +11 cost includes the impact of tariffs along with just supporting those businesses. On the markdown front, look, we competed in the Q3. Markdowns are up a little bit in terms of the total impact of the quarter. We expect Q4 to be similar. We're just going to be ready to compete in these big days. We competed over the weekend.

Speaker #4: It's positioned well to continue to fuel this area in offline trends. We definitely, as Jen talked about in her remarks, are resetting some denim inventory to make sure we continue to be in stock and don't miss a sale within the AE jeans category.

Speaker #4: And again, that plus $11 cost includes the impact of tariffs along with just supporting those businesses. On the markdown front, look, we competed in the third quarter.

We've seen or the quarter day trend includes a little uptick in markdowns to compete, but, uh, definitely winning in terms of the Top Line growth and the overall margin dollar growth attached to that, um, and it is in a couple places. I mean, our is similar markdown rate to last year. So you're we're driving this trend on on markdown rates similar to history. We're not driving it through promotion and then it really is competing in jeans more than anything from a category perspective that's adding to the markdowns a bit. Um but we're you know we we think that's the right strategy from here.

Speaker #4: Markdowns are up a little bit in terms of the total impact of the quarter. We expect Q4 to be similar. We're just going to be ready to compete in these big days.

Speaker #4: We competed over the weekend. This November trend that we've seen or the quarter-day trend includes a little uptick in markdowns to compete. But definitely winning in terms of the top line growth and the overall margin dollar growth attached to that.

Uh, gross margin then. In total really pleased with the third quarter results. Um, you know, we talked, we disclosed the or we hit the 20 million dollar guidance roughly on, the Tariff impact, that's about 150 basis points. But as you can see, gross marginal ID, leveraged by 40 on a 4 comp,

Mike Mathias: This November trend that we've seen, or the Q4 trend, includes a little uptick in markdowns to compete, but definitely winning in terms of the top-line growth, and the overall margin dollar growth attached to that. And it is in a couple of places. I mean, Aerie is similar markdown rate to last year, so we're driving this trend on markdown rate similar to history. We're not driving it through promotion. And then it really is competing in jeans more than anything from a category perspective that's adding to the markdowns a bit. But we think that's the right strategy from here. Gross margin then in total, really pleased with the Q3 results. We disclosed or we hit the $20 million guidance roughly on the tariff impact. That's about 150 basis points. But as you can see, gross margin only deleveraged by 40 on the four comp.

This November trend that we've seen, or the Q4 trend, includes a little uptick in markdowns to compete, but definitely winning in terms of the top-line growth, and the overall margin dollar growth attached to that. And it is in a couple of places. I mean, Aerie is similar markdown rate to last year, so we're driving this trend on markdown rate similar to history. We're not driving it through promotion. And then it really is competing in jeans more than anything from a category perspective that's adding to the markdowns a bit. But we think that's the right strategy from here. Gross margin then in total, really pleased with the Q3 results. We disclosed or we hit the $20 million guidance roughly on the tariff impact. That's about 150 basis points. But as you can see, gross margin only deleveraged by 40 on the four comp.

So the team is doing a great job, not only just mitigating tariffs on the front end but then uh finding kind of opportunities and efficiencies on other, non-tariff impacted line items within our within our costs, we highlighted Freight.

Speaker #4: And it is in a couple of places. I mean, Airy is similar markdown rate to last year. So we're driving this trend on markdown rates similar to history.

Speaker #4: We're not driving it through promotion. And then it really is competing in jeans more than anything from a category perspective. That's adding to the markdowns a bit.

Speaker #4: But we think that's the right strategy from here. Gross margin then, in total, really pleased with the third quarter results. We talked, we disclosed, or we hit the $20 million guidance, roughly, on the tariff impact.

But there's uh, more work than just on the freight line. So Q4 similar, I mean, we're regarding to a 50 million dollar impact in the kind of the net, absolute value, or the net impact of that. Absolute impact of that would be about 300 basis points. So we're obviously not guiding gross margin down that much. So, we, we, we expect to see the same, um, opportunities in terms of offsets and other line items and then just on an 8 or 9 comp. Obviously, we're leveraging a lot of expense lines that are up in gross margin.

Including am so including rent.

Speaker #4: That's about 150 basis points. But as you can see, gross margin only delivered by 40 on a four comp. So the team is doing a great job not only just mitigating tariffs on the front end, but then finding kind of opportunities and efficiencies on other non-tariff impacted line items within our costs.

Mike Mathias: So the team is doing a great job not only just mitigating tariffs on the front end, but then finding kind of opportunities and efficiencies on other non-tariff impacted line items within our cost. We highlighted freight, but there's more work than just on the freight line. So Q4 similar. I mean, we're guiding to a $50 million impact, and kind of the net absolute value or the net impact of that absolute impact of that would be about 300 basis points. But we're obviously not guiding gross margin down that much. So we expect to see the same opportunities in terms of offsets and other line items. And then just on an 8 to 9 comp, obviously, we're leveraging a lot of expense lines that are up in gross margin, including BOW, so including rent, digital delivery, distribution costs, compensation up there as well.

So the team is doing a great job not only just mitigating tariffs on the front end, but then finding kind of opportunities and efficiencies on other non-tariff impacted line items within our cost. We highlighted freight, but there's more work than just on the freight line. So Q4 similar. I mean, we're guiding to a $50 million impact, and kind of the net absolute value or the net impact of that absolute impact of that would be about 300 basis points. But we're obviously not guiding gross margin down that much. So we expect to see the same opportunities in terms of offsets and other line items. And then just on an 8 to 9 comp, obviously, we're leveraging a lot of expense lines that are up in gross margin, including BOW, so including rent, digital delivery, distribution costs, compensation up there as well.

Uh, digital delivery distribution costs, compensation up there as well but other other cost line items within our product costs are being leveraged too. Um so we continue to expect to do that, go forward.

And the next question comes from. Paul Les with City, please go ahead.

Speaker #4: We highlighted freight, but there's more work than just on the freight line. So, Q4 is similar. I mean, we've got into a $50 million impact, and kind of the net absolute value or the net impact of that absolute impact would be about 300 basis points.

Speaker #4: But we're obviously not guiding gross margin down that much. So we expect to see the same opportunities in terms of offsets in other line items.

Speaker #4: And then just on an eight and nine comp, obviously, we're leveraging a lot of expense lines that are up in gross margin, including and BOW.

Hi. This is Kelly on, for Paul, thanks for taking a question. Um, I just first question for you guys. Just, uh, could you talk about why, you know, given you've had these very splashy and high-profile marketing campaigns that were were more kind of, um, you know, more based on or were American Eagle marketing campaigns, like why you didn't see that a crew more to AE versus in, you know, what you're seeing in an area where it seems like you're benefiting a lot from, um, whether that's

Speaker #4: So, including rent, digital delivery, distribution costs, and compensation up there as well. But other cost line items within our product costs are being leveraged too.

The product assortment or, or maybe some of the marketing, uh, campaigns. Just

Mike Mathias: But other cost line items within our product costs are being leveraged too. So we continue to expect to do that go forward.

But other cost line items within our product costs are being leveraged too. So we continue to expect to do that go forward.

Speaker #4: So we continue to expect to do that going forward.

Speaker #6: And the next question comes from Paul Le Juez with Citi. Please go ahead.

Operator: The next question comes from Paul Lejuez with Citi. Please go ahead.

Help us kind of understand what's happening there and then just secondly, on, uh, the Tariff impact. I think you said million dollar, uh, impact in the fourth quarter is that the right, uh, net? Uh, tariff impact that we should be thinking about for the first half of 26? Thanks,

Speaker #7: Hi, this is Kelly on Paul. Thanks for taking a question. The first question for you guys, just could you talk about why given you've had these very splashy and high-profile marketing campaigns that were more kind of more based on or were American Eagle marketing campaigns, why you didn't see that accrue more to AE versus what you're seeing in Airy where it seems like you're benefiting a lot from whether that's the product assortment or maybe some of the marketing campaigns.

Jay Schottenstein: Hi. This is Kelly on the call. Thanks for taking our question. First question for you guys, just could you talk about why, given you've had these very splashy and high-profile marketing campaigns that were more kind of more based on or were American Eagle marketing campaigns, why you didn't see that accrue more to AE versus what you're seeing in Aerie, where it seems like you're benefiting a lot from whether that's the product assortment or maybe some of the marketing campaigns. Just help us kind of understand what's happening there. And then just secondly, on the tariff impact, I think you said $50 million impact in the Q4. Is that the right net tariff impact that we should be thinking about for the first half of 2026? Thanks.

[Company Representative] (Citi): Hi. This is Kelly on the call. Thanks for taking our question. First question for you guys, just could you talk about why, given you've had these very splashy and high-profile marketing campaigns that were more kind of more based on or were American Eagle marketing campaigns, why you didn't see that accrue more to AE versus what you're seeing in Aerie, where it seems like you're benefiting a lot from whether that's the product assortment or maybe some of the marketing campaigns. Just help us kind of understand what's happening there. And then just secondly, on the tariff impact, I think you said $50 million impact in the Q4. Is that the right net tariff impact that we should be thinking about for the first half of 2026? Thanks.

Sure. Um, you know, as a company we're leaning into advertising. Um we need to compete, you know, when we see our what our competition is doing um you know, there was definitely opportunity for us to lean in and certainly Sydney Sweeney and Travis. I mean with the 44 billion Impressions um really

Speaker #7: Just help us kind of understand what's happening there. And then just secondly, on the tariff impact, I think you said a $50 million impact in the fourth quarter.

Speaker #7: Is that the right net tariff impact that we should be thinking about for the first half of 26? Thanks.

Speaker #3: Sure. As a company, we're leaning into advertising. We need to compete. When we see what our competition is doing, there is definitely an opportunity for us to lean in, and certainly, Sydney Sweeney and Travis.

Jen Foyle: Sure. As a company, we're leaning into advertising. We need to compete. When we see what our competition's doing, there was definitely opportunity for us to lean in. And certainly, Sydney Sweeney and Travis Kelce, I mean, with the 44 billion impressions, really, it was something that we did not expect. And certainly, I mentioned some of the out-of-stocks in women's, particularly, but men's certainly turned around in the mid-single-digit comp zone. And that was really, we were so pleased to see that. And I just wanted to say sometimes there's a halo effect in marketing, right? So as we saw that, as we got into in-stock in denim, we got our in-stocks back to more normalized levels towards the end of the quarter, we saw acceleration, particularly in women's and into black. As I mentioned, it was an incredible week for us. Thanksgiving week and Friday was amazing.

Speaker #3: I mean, with the 44 billion impressions, really, it was something that we did not expect. And certainly, I mentioned some of the out-of-stocks in women's, particularly, but men certainly turned around in the mid-single-digit comp zone, and that was really—we are so pleased to see that.

It was, you know, something that we did not expect. Um, and certainly, you know, I mentioned some of the out of stocks, in women's particularly but, um, men certainly turned around, um, in the mid single digit comp Zone. Um, and that was really we were, we were so pleased to see that. And, um, I just wanted to say, sometimes there's a halo effect in marketing, right? So as we, um, saw that as we got into in stock as denim, you know, we got our stock in, stocks back to, uh, more normalized, um, levels. You know, towards the end of the quarter, we saw acceleration particularly in women's and into black. As I mentioned, it was, um, an incredible week for us Thanksgiving week and, you know, Friday was amazing. So, um, we're seeing the results now and, um, look, this is important for our future. We need to remain strong and competitive, um, and we need to amplify our product. Uh, the teams have been working.

Tirelessly on um, this you know, price value equation that I think American Eagle does better than anyone. And um and we're leaning in and this marketing will certainly amplify.

Speaker #3: And I just wanted to say sometimes there's a halo effect in marketing, right? So as we saw that as we got into as denim, we got our stock in stocks back to more normalized levels, towards the end of the quarter, we saw acceleration, particularly in women's and into black, as I mentioned, it was an incredible week for us.

Okay. And again, like to also add

We also seen a significant increase in our loyalty members too.

We saw over a million more loyalty members, join us.

Speaker #3: Thanksgiving week and Friday were amazing, so we're seeing the results now. And look, this is important for our future. We need to remain strong and competitive.

Jen Foyle: So we're seeing the results now. And look, this is important for our future. We need to remain strong and competitive, and we need to amplify our product. The teams have been working tirelessly on this price value equation that I think American Eagle does better than anyone. And we're leaning in, and this marketing will certainly amplify.

So we're seeing the results now. And look, this is important for our future. We need to remain strong and competitive, and we need to amplify our product. The teams have been working tirelessly on this price value equation that I think American Eagle does better than anyone. And we're leaning in, and this marketing will certainly amplify.

In these past, in, in these past few months, and as Jen said, you don't see the, uh, you don't see it right away. And she also pointed out that, you know, it was interesting with Cindy Sweeney the jeans that we had made made specifically for Cindy Sweeney.

They sold out like within 2 days.

Speaker #3: And we need to amplify our product. The teams have been working tirelessly on this price-value Eagle does better than equation that I think American anyone.

Yep.

Then I can I can take the Tariff question I think. Um maybe the best way to to provide some color is just to give the quarterly impact. So

Speaker #3: And we're leaning in. And this marketing will certainly amplify.

We expect to go forward if tariffs, hold as is in terms of the impact. Um, we'll see how that.

Jay Schottenstein: Again, Jen.

Again, Jen.

Speaker #4: And to also add, we see a significant increase in our loyalty members too. We saw over 1 million more loyalty members join us.

Judy Meehan: I'd like to also add, we also see a significant increase in our loyalty members too. We saw over a million more loyalty members join us in these past few months. And as Jen said, you don't see it right away. And she also pointed out that it's interesting with Sydney Sweeney, the jeans that we had made specifically for Sydney Sweeney. They sold out within two days. They boomed right out right away.

Jay Schottenstein: I'd like to also add, we also see a significant increase in our loyalty members too. We saw over a million more loyalty members join us in these past few months. And as Jen said, you don't see it right away. And she also pointed out that it's interesting with Sydney Sweeney, the jeans that we had made specifically for Sydney Sweeney. They sold out within two days. They boomed right out right away.

Continues to progress about a 25 to 30 million dollar impact in each of the first and second quarter.

Speaker #4: In these past few months, and as Jen said, you don't see the you don't see it right away. And she also pointed out that it's interesting with Sydney Sweeney, the jeans that we had made specifically for Sydney Sweeney, they sold out like within two days.

Um, so call it somewhere between 200, maybe 200 225 basis points of impact in q1, same impact in Q2.

Um, 40 to 60 million dollars, call it in the first half.

Speaker #4: They boomed right out right away.

Mike Mathias: Yep. And I can take the tariff question. I think maybe the best way to provide some color is just to give the quarterly impact. So we expect to go forward if tariffs hold as is in terms of the impact. We'll see how that continues to progress. About a $25 to 30 million impact in each of the first and second quarter. So call it somewhere between 200, maybe 200 to 225 basis points of impact in Q1, same impact in Q2, $40 to 60 million, call it in the first half. Next Q3, on the $20 million we just incurred in Q3, we expect Q3 on a full basis to be about a $35 to 40 million. So call it $15 to 20 million impact incrementally next year. And then we'd anniversary roughly the $50 million that we're guiding to this Q4.

Speaker #6: question. I think maybe the best Yep. And I can take the tariff way to provide some color is just to give the quarterly impact.

Uh, next Q3 on the 20 million dollars. We just, um, incurred in Q3, we expect Q3 on a full basis to be about a 35 to 40 million dollars. So, call it 15 to 20 million impact incrementally next year and then we'd anniversaries at roughly the 50 million dollars that we're adding to this fourth quarter.

Um, so it's about a 200 to 225 basis point impact on a full year basis.

Speaker #6: So we expect to go forward if tariffs hold as is in terms of the impact. We'll see how that continues to progress. About a $25 to $30 million impact in each of the first and second quarters.

and but again with continued offsets in work um we'd expect to the gross margin to not be impacted to that level, just like we've seen here in Q3 and Q4

Am I?

Speaker #6: So call it somewhere between 200, maybe 200, 225 basis points of impact in Q1. Same impact in Q2. 40 to 60 million dollars, call it in the first half.

Mike, or maybe like a Supreme Court ruling company on shortly too that, you know, you know, it may have changed and everything right away. We don't, right? Yep.

Speaker #6: Next Q3 on the 20 million dollars we just incurred in Q3, we expect Q3 on a full basis to be about a 35 to 40 million dollars.

Yeah, so so that the Assumption then would be that you would be taking some likes or like pricing into next year.

Speaker #6: it 15 to 20 million So call impact, incrementally next year. And then we'd anniversary roughly the 50 million dollars that we're guiding to this fourth quarter.

Speaker #6: So it's about a 200 to 225 basis point impact on a full year basis. But again, with continued offsets and work, we expect the gross margin to not be impacted to that level just like we've seen here in Q3 and Q4.

Mike Mathias: So it's about 200 to 225 basis points impact on a full year basis. But again, with continued offsets in work, we expect the gross margin to not be impacted to that level just like we've seen here in Q3 and Q4.

So it's about 200 to 225 basis points impact on a full year basis. But again, with continued offsets in work, we expect the gross margin to not be impacted to that level just like we've seen here in Q3 and Q4.

Speaker #4: And Mike.

Judy Meehan: And Mike.

Jay Schottenstein: And Mike.

Speaker #7: Got it. And is

Jay Schottenstein: Got it. And is that?

Jen Foyle: Got it. And is that?

Speaker #7: That. And Mike, there may be like a Supreme Court.

Judy Meehan: And Mike, there may be a Supreme Court ruling coming out shortly too. And it may have changed everything right away. We don't know.

Jay Schottenstein: And Mike, there may be a Supreme Court ruling coming out shortly too. And it may have changed everything right away. We don't know.

Yes, I think I mean on the pricing front, um we're we definitely do not have a specific strategy to pass through the impact of tears to to our customers. Um we continue to take shots where we know we can where we're making price moves that, you know we we uh still fit within our price value equation that the customer expects and we don't see any resistance to those price changes um from the customer. And just take a changes that allow us to have create a little more room on the promotional front too to make some decisions within our lease lines. So we'll continue to do that. I think we're seeing success doing or approaching it that way in the back half right now. Uh we'll continue to do that in the next year.

Speaker #4: ruling coming out shortly too. And it may have changed and everything right away.

Thanks to you. Thank you. Best of luck.

Speaker #6: Right.

Mike Mathias: Right. Yep.

In the next question comes from Jonah. Kim with TD Cowen, please go ahead.

Speaker #7: So the assumption then would

Jay Schottenstein: The assumption then would be that you would be taking some like-for-like pricing into next year?

[Company Representative] (Citi): The assumption then would be that you would be taking some like-for-like pricing into next year?

Speaker #7: be that you would be taking some like-for-like pricing into next year?

Mike Mathias: Yes. I think, I mean, on the pricing front, we definitely do not have a specific strategy to pass through the impact of tariffs to our customers. We continue to take shots where we know we can, where we're making price moves that still fit within our price value equation that the customer expects, and we don't see any resistance to those price changes from the customer. And just ticket changes that allow us to create a little more room on the promotional front too, to make some decisions within our lease lines. So we'll continue to do that. I think we're seeing success or approaching it that way in the back half right now. We'll continue to do that in next year.

Speaker #6: front, we definitely do not have a specific strategy to pass through the impact of Yep. Yeah. So I think, I mean, on the pricing tariffs to our customers.

Speaker #6: We continue to take shots where we know we can, where we're making price moves that still fit within our price-value equation that the customer expects, and we don't see any resistance to those price changes.

Thank you for taking my question, you mentioned strong customer acquisition across both Brands. Maybe you can give us a little bit more detail around who those customers are. And if you're gaining more higher income cohorts, um the curious on who you are, um gaining share from uh as you acquire new customers.

Speaker #6: From the changes that allow us to create a little more customer engagement and just ticket room on the promotional front, too, to make some decisions within our lease lines.

And then another question, just follow up to that is what are your strategies around retaining those customers you gain? Um, you know, in the last 2 quarters, thank you so much.

Speaker #6: So we'll continue to do that. I think we're seeing success doing or approaching it that way in the back half right now. We'll continue to do that in next

Speaker #6: year. Thanks,

Jay Schottenstein: Thank you. Thank you. Best of luck.

[Company Representative] (Citi): Thank you. Thank you. Best of luck.

Speaker #7: Peter. Thank you. Best of

Speaker #7: luck. And the next

Operator: The next question comes from Jonna Kim with TD Cowen. Please go ahead.

Speaker #6: Question comes from Jonah Kim with TD Cowan. Please go ahead.

Um, look uh, both brands. Have, you know, the our customer file is stronger than ever. Um, and we certainly have seen acceleration. As I mentioned going into even leaving Q3, you know, exiting Q3 and going into Q4, um,

Speaker #8: Thank you for taking my question. You mentioned strong customer acquisition across both brands. Maybe you can give us a little bit more detail around who those customers are and if you're gaining more higher-income cohorts. I'm just curious who you are gaining share from as you acquire new customers.

Jay Schottenstein: Thank you for taking my question. You mentioned strong customer acquisition across both brands. Maybe you can give us a little bit more detail around who those customers are and if you're gaining more higher-income cohorts. Just curious on who you are gaining share from as you acquire new customers. And then another question just follow-up to that is, what are your strategies around retaining those customers you gained in the last two quarters? Thank you so much.

Jonna Kim: Thank you for taking my question. You mentioned strong customer acquisition across both brands. Maybe you can give us a little bit more detail around who those customers are and if you're gaining more higher-income cohorts. Just curious on who you are gaining share from as you acquire new customers. And then another question just follow-up to that is, what are your strategies around retaining those customers you gained in the last two quarters? Thank you so much.

Speaker #8: And then, another question to follow up on that is: what are your strategies around retaining those customers you gained in the last two quarters?

Speaker #8: Thank you so

Speaker #8: much. Look,

Jen Foyle: Look, both brands, our customer file is stronger than ever. We certainly have seen acceleration, as I mentioned, going into even leaving Q3, exiting Q3, and going into Q4 with some really high, it's really high-end problems here that we're seeing. Look, it's what we do every day. Our teams need to certainly focus on the retention, and we've been all year long. That's what we've been up to. Our retention is not even, we're winning on retention. We are winning on customer acquisition. The teams have strategies. Those I tend to not share publicly, but the strategies are already paying off. You can see it in the news that we're just reporting today. We're getting talent. We're working on our influencer programs, but we're also working on our communities. And that is the most important thing. We have powerful brand platforms that we stand for something.

Speaker #3: Both brands have our customer file stronger than ever, and we certainly have seen acceleration, as I mentioned, going into even leaving Q3, exiting Q3, and going into Q4.

Speaker #3: With some really high, it's really high-end problems here that we're seeing teams need to certainly focus look. It's what we do every day. Our on the retention.

With some, you know, uh, really. Uh, hi. It's, it's really high-end problems here that we're seeing. Um, look, it's it's what we do every day. Our teams need to certainly focus on the retention and, and we've been all year long. That's what we've been up to our. Our retention is not even, uh, we're winning on retention. We are winning on customer acquisition, um, the teams have strategies, you know, those I tend to not share, um, publicly but the strategies are, are already, you know, paying off. You can see it in the news that we're just reporting today. Um, you know, we're we're getting Talent. We're working on our influencer programs, but we're also working on our communities, and that is the most important thing. Um, you know, we have powerful brand platforms that we stand for something, and it wears the test of time and when that works and, um, we have the great product attached to it, we can win and, um, show up in a new way.

Speaker #3: And we've been all year long, that's what we've been up to. Our retention is not even we're winning on retention. We are winning on customer acquisition.

Speaker #3: strategies. Those I tend The teams have to not share publicly, but the strategies are already paying off. You can see it in the news that we're just reporting today.

Speaker #3: We're getting talent. We're working on our influencer programs, but we're also working on our communities. And that is the most important thing. We have powerful brand platforms that we stand for something.

Speaker #3: And it wears the test of time. And when that works, and we have the great product attached to it, we can win and show up in a new way.

Jen Foyle: And it wears the test of time. And when that works and we have the great product attached to it, we can win and show up in a new way. And the teams have very many strategies, whether it's upper funnel, getting out there and bringing in new customers, or working on our performance marketing and our influencer strategies. So it's never about one part of the strategy. It's about getting the product right first and making sure that our tactics will amplify that strategy. Certainly, Sydney, an example, Sydney and Travis, but even the more recent Martha, I mean, that is talent. That's upper funnel. That is us getting our brands out there in new ways.

And it wears the test of time. And when that works and we have the great product attached to it, we can win and show up in a new way. And the teams have very many strategies, whether it's upper funnel, getting out there and bringing in new customers, or working on our performance marketing and our influencer strategies. So it's never about one part of the strategy. It's about getting the product right first and making sure that our tactics will amplify that strategy. Certainly, Sydney, an example, Sydney and Travis, but even the more recent Martha, I mean, that is talent. That's upper funnel. That is us getting our brands out there in new ways.

Speaker #3: And the teams have many strategies, whether it's upper funnel, getting out there and bringing in new customers, or working on our performance marketing.

Speaker #3: And our influencer strategies. So it's not only it's never about one part of the strategy. It's about getting the product right first and making sure that our tactics will amplify that strategy.

Speaker #3: Certainly, Sydney, an example, Sydney and Travis, but even the more recent Martha, I mean, that is talent that's upper funnel. That is us getting our brands out there in new ways.

Speaker #3: But if you lean into area and how they're working their marketing strategy, they're leveraging our community in a new way. And showing up with how do we go from not airbrushing our models, what does AI mean I just mentioned, into to such a pure brand as Erie, with such an amazing platform.

Jen Foyle: But if you lean into Aerie and how they're working their marketing strategy, they're leveraging our community in a new way and showing up with how do we go from not airbrushing our models, I just mentioned, into what does AI mean to such a pure brand as Aerie with such an amazing platform. So it is about we have two different brands. We have a portfolio of brands in the same token that we leverage our brands. Certainly, we share a platform, but it is about making sure that we play up each brand DNA in the right way. And it's working. That strategy is working. I can say that now. And there's work to do always. As we look ahead, we have exciting collaborations, new talent, and just new ideas. We're constantly thinking of new ideas.

But if you lean into Aerie and how they're working their marketing strategy, they're leveraging our community in a new way and showing up with how do we go from not airbrushing our models, I just mentioned, into what does AI mean to such a pure brand as Aerie with such an amazing platform. So it is about we have two different brands. We have a portfolio of brands in the same token that we leverage our brands. Certainly, we share a platform, but it is about making sure that we play up each brand DNA in the right way. And it's working. That strategy is working. I can say that now. And there's work to do always. As we look ahead, we have exciting collaborations, new talent, and just new ideas. We're constantly thinking of new ideas.

And, and showing up with, how do we go from? Not, airbrushing our models, I just mentioned into, what does AI mean to? Um, such a pure brand as Airy with such an amazing platform. So it is about, we have 2 different brands. Um, we have a portfolio of brands at the in the same token that we leverage. Our Brands, certainly we share a platform, but it is about making sure that we play up each brand DNA in the right way. And, um, and and it's working. That's strategy is working. I can just I, I can say that now, and there's work to do always, um, as we look ahead, we have exciting collaborations, new Talent, um, and just new ideas. Uh, we're constantly thinking of new ideas,

got it. Thank you.

And the next question comes from Rick. Patel with Raymond James, please go ahead.

Speaker #3: So, it is about we have two different brands. We have a portfolio of brands in the same token that we leverage our brands certainly.

Speaker #3: We share a platform, but it is about making sure that we play up each brand DNA, in the right way, and it's working. That strategy is working.

Thank you, good afternoon. Um, I wanted to double click on your expectations for Aur in Q4. As we think about the company remaining competitive with promotions but also factoring in some product and, and perhaps some pricing wind, where, where do you see Aur Landing uh, in the fourth quarter? And then second uh what are your expectations for inventory will end the year both in terms of dollars and units?

Speaker #3: I can just say that now, and there's work to do always. As we look ahead, we have exciting collaborations, new talent, and just new ideas.

Speaker #3: We're constantly thinking of new ideas.

Speaker #8: Got it. Thank

Jay Schottenstein: Got it. Thank you.

Jonna Kim: Got it. Thank you.

Speaker #8: you. And the

Operator: The next question comes from Rick Patel with Raymond James. Please go ahead.

Speaker #6: Next question comes from Rick Patel with Raymond James. Please go ahead.

Operator: The next question comes from Rick Patel with Raymond James. Please go ahead.

Speaker #6: ahead. Thank

Speaker #9: You. Good afternoon. I wanted to double-click on your expectations for AUR in Q4. As we think about the company remaining competitive with promotions, but also factoring in some product and perhaps some pricing wins, where do you see AUR landing in the fourth quarter?

Matthew Boss: Thank you. Good afternoon. I wanted to double-click on your expectations for AUR in Q4. As we think about the company remaining competitive with promotions, but also factoring in some product and perhaps some pricing wins, where do you see AUR landing in the fourth quarter? And then second, what are your expectations for where inventory will end the year, both in terms of dollars and units?

Rick Patel: Thank you. Good afternoon. I wanted to double-click on your expectations for AUR in Q4. As we think about the company remaining competitive with promotions, but also factoring in some product and perhaps some pricing wins, where do you see AUR landing in the fourth quarter? And then second, what are your expectations for where inventory will end the year, both in terms of dollars and units?

Eric. Yeah. Um, the Aur for the third quarter was relatively flat even with a bit of a markdown increase, just the mix of the mix of the businesses between the brands category mix are, you always relatively flat at the company level. We're expecting the similar thing in Q4, uh, November to date here, we saw it play out that way. Um, Aries, actually, driving these comps on some up, picking Aur, we know, we're spending a little more markdowns in the jeans category in AE, to drive the business. So the mix for the quarter, we'd expect right now to be similar um, around a relatively flat Aur for the fourth quarter.

Um, and I think, uh, you know, it's the way we really expect to plan the business go forward.

Speaker #9: And then second, what are your expectations for where inventory will end the year, both in terms of dollars and...

Great. Any thoughts on inventory?

Speaker #9: units? Eric, yeah.

Mike Mathias: Eric, yeah. The AUR for the third quarter was relatively flat, even with a bit of a markdown increase. Just the mix of the businesses between the brands, category mix, our AUR was relatively flat at a company level. We're expecting a similar thing in Q4. November to date here, we saw it play out that way. Aerie is actually driving these comps on some uptick in AUR. We know we're spending a little more markdowns in the jeans category in AE to drive the business. So the mix for the quarter we'd expect right now would be similar, around a relatively flat AUR for the fourth quarter. And I think it's the way we really expect to plan the business go forward.

Speaker #4: The AUR for the third quarter was relatively flat, even with a bit of a markdown increase. Just the mix of the businesses between the brands, category mix, our AUR was relatively flat at a company level.

Speaker #4: We're expecting a similar thing in Q4. November to date here, we saw it play out that way. Erie is actually driving these comps on some uptick in AUR.

Thank you for. We're not providing specific guidance, but, um, at the end of the day here with the uptick in the trend, exceeding plans, we're definitely in Chase mode here, um, which is a good thing. It's when we make a, we we have, we see a lot of profits flow through when we're doing that. Especially on the air side of the house. Um, so we expect uh, you know, inventory in line with sales. Um,

Speaker #4: We know we're spending a little more on markdowns in the jeans category in AE to drive the business. So the mix for the quarter we'd expect right now to be similar.

You know, with regarding to the plus, uh, 8 to 9 comp, and as of now, I'd expect similar kind of, you know, inventory line with sales or lease units, in, in line, with the sales growth, knowing there will be a tariff impact, um, ongoing.

But when I not providing specific guidance at this point, but that's what we'd expect to see.

Speaker #4: Around a relatively flat AUR for the fourth quarter. And I think it's the way we really expect to plan the business go forward.

Thanks very much.

And the next question comes from Chris nardone with Bank of America, please go ahead.

Speaker #9: Great. Any thoughts on inventory?

Matthew Boss: Great. Any thoughts on inventory?

Rick Patel: Great. Any thoughts on inventory?

Speaker #4: Q4, we're not providing specific guidance, but at the end of the day, with the uptick in the trend exceeding plans, we're definitely in chase mode here.

Mike Mathias: Q4, we're not providing specific guidance, but at the end of the day here with the uptick in the trend, exceeding plans, we're definitely in chase mode here, which is a good thing. It's when we make it, we see a lot of profit flow through when we're doing that, especially on the Aerie side of the house. So we expect inventory in line with sales. We're guiding to the +8% to 9% comp. And as of now, I'd expect similar kind of inventory in line with sales or at least units in line with the sales growth, knowing there'll be a tariff impact ongoing. But we're not providing specific guidance at this point, but that's what we'd expect to see.

Speaker #4: Which is a good thing. It's when we see a lot of profit flow through when we're doing that, especially on the Erie side of the house.

Thanks guys. Good afternoon. So first uh, can you use refresh us on how we should think about plans for the both the eagle and Aries store fleets heading into next year, and if the recent results of both businesses has changed how you're thinking about that versus maybe 90 days ago.

Speaker #4: So we expect inventory in line with sales. We're guiding to the plus 8 to 9 comp. And as of now, I'd expect similar kinds of inventory in line with sales or at least units in line with the sales growth, knowing there'll be a tariff impact ongoing.

Yeah, Chris I think um, for the a brand we talked about closing, roughly 35 stores at the end of this year.

Um, you know, we're looking forward into plans next year and what I expect that to slow down. As we've largely closed I think over the last 3 or 4 years.

Speaker #4: But we're not providing specific guidance at this point, but that's what we'd expect to see.

uh it's kind of the lower productivity stores in the fleet um on the in the main line AE Fleet

Speaker #9: Thanks very much.

Matthew Boss: Thanks very much.

Rick Patel: Thanks very much.

Speaker #6: And the next question comes from Chris Nardone with Bank of America. Please go ahead.

Operator: The next question comes from Chris Nardone with Bank of America. Please go ahead.

Speaker #10: Thanks, guys. Good afternoon. So first, can you just refresh us on how we should think about plans for both the Eagle and Erie store fleets heading into next year?

Chris Nardone: Thanks, guys. Good afternoon. So first, can you just refresh us on how we should think about plans for both the Eagle and Aerie store fleets heading into next year? And if the recent results of both businesses have changed how you're thinking about that versus maybe 90 days ago?

Speaker #10: And if the recent results of both businesses have changed how you're thinking about that versus maybe 90 days

Speaker #4: Yeah, Chris, I think for the AE brand, we talked about closing roughly 35 stores at the end of this year. We're looking forward into plans next year, and I expect that to slow down as we've largely closed, I think, over the last three, four years, kind of the lower productivity stores in the fleet.

Mike Mathias: Yeah, Chris, I think for the AE brand, we talked about closing roughly 35 stores at the end of this year. We're looking forward into plans next year, and I expect that to slow down as we've largely closed, I think, over the last three, four years, kind of the lower productivity stores in the fleet, in the mainline AE fleet. So 35 at the end of this year here in January. Maybe something lower than that I would expect next year on the Aerie and OFFLINE growth front. We talked about 22 Aerie, 26 OFFLINE openings this year in 2025. We're looking at a similar 40 to 50 store count at the moment. Probably similar weighting OFFLINE, a little more off, a little higher count OFFLINE than an Aerie.

Uh, so 35 at the end of this year here in January, um, maybe something something lower than that I would expect next year on the area in offline growth front. Uh, we talked about 22, Aries, 26 offline, openings this year in 2025 we're looking at a similar 40 to 50 store count at the moment. Uh, probably similar waiting offline a little little more off a little um little higher count offline than an area. But we are looking at this tremendous growth and we'll if if we did anything we'd maybe accelerate some openings on the area

Offline side, but where those plants are still in work right now. A similar 40 to 50 count is what's what's in the plan.

Okay. Got it and then just a quick follow-up. I think you alluded area, comps are running above the High Teens for the quarter quarter to date.

Speaker #4: In the mainline AE fleet. So 35 at the end of this year here in January. Maybe something lower than that, I would expect next year.

Speaker #4: On the Erie and offline growth front, we talked about 22 Erie, 26 offline openings this year and 2025. We're looking at a similar 40 to 50 store count at the moment.

And if Aur is roughly flattish, can you do some pack a little bit further? It sounds like you're seeing inflections across the product sweep. But are there particular channels whether that's digital versus retail or certain categories? Where you're seeing the biggest inflection? We're just trying to understand a little bit better, what has changed so drastically over the last 6 months.

Yeah. Look, um

Speaker #4: Probably similar weighting offline a little more higher count in offline than in Erie. But we are looking at this tremendous growth, and if we did anything, we'd maybe accelerate some openings on the Erie and offline side, but those plans are still in work.

Mike Mathias: But we are looking at this tremendous growth, and if we did anything, we'd maybe accelerate some openings on the Aerie and OFFLINE side, but those plans are still in the works. Right now, a similar 40 to 50 count is what's in the plan.

But we are looking at this tremendous growth, and if we did anything, we'd maybe accelerate some openings on the Aerie and OFFLINE side, but those plans are still in the works. Right now, a similar 40 to 50 count is what's in the plan.

The guidance we're giving at the 8 to 9 comp, I'll just reiterate American Eagle low to mid single expectations Airy, High Teens. Both brands are running ahead of that Trend November to date or through the Thanksgiving weekend.

Speaker #4: Right now, a similar 40 to 50 count is what's in the plan.

Speaker #10: Okay. Got it. And then just a quick follow-up. I think you alluded, Erie comps are running above the high teens for the quarter, quarter to date.

Chris Nardone: Okay. Got it. And then just a quick follow-up. I think you alluded to Aerie comps are running above the high teens for the quarter, quarter to date. And if AUR is roughly flat-ish, can you just unpack a little bit further? It sounds like you're seeing inflections across the product suite, but are there particular channels, whether that's digital versus retail, or certain categories where you're seeing the biggest inflection? We're just trying to understand a little bit better what has changed so drastically over the last six months.

Speaker #10: And if AUR is roughly flattish, can you just unpack a little bit further? It sounds like you're seeing inflections across the product suite, but are there particular channels—whether that's digital versus retail or certain categories—where you're seeing the biggest inflection?

Speaker #10: We're just trying to understand a little bit better what has changed so drastically over the last six months.

Speaker #4: Yeah. Correct. The guidance we're giving at the 8 to 9 comp, I'll just reiterate, American Eagle low to mid single expectations, Erie high teens, both brands are running ahead of that trend November to date or through the Thanksgiving weekend.

Mike Mathias: Yeah. Look, correct. The guidance we're giving at the 8 to 9 comp, I'll just reiterate, American Eagle low to mid-single expectations, Aerie high teens. Both brands are running ahead of that trend November to date or through the Thanksgiving weekend. Digital ahead of stores. And I think the marketing campaigns that Jen and Jay are talking about, the traffic we're seeing digitally off of those campaigns is significant. And that's where we're seeing a lot of the gains from those efforts and from the effectiveness of those campaigns. So digital was both channels were positive in Q3, but digital was on the high end or the high single-digit level for Q3. And we'd expect for Q4 at a plus 8 to 9, same kind of outcome that digital would really outpace stores.

Uh digital ahead of stores and I think um you know the marketing campaigns that Jen and J are talking about the traffic we're seeing digitally off of those campaigns is significant and that's where we're seeing a lot of the gains um, from those efforts and from the the effectiveness of those campaigns so digital was uh, both channels were positive in Q3, but digital was on the uh the high end or the high single digit level for Q3 and we'd expect for Q4 at a plus 8 to 9, same kind of outcome, the digital would really outpace stores and we've seen that through November and especially over the holiday weekend here where both channels were positive. And we we were happy with success in both channels but digital is where we're seeing the outpace growth at the moment.

Speaker #4: Digital is ahead of stores, and I think the marketing campaigns that Jen and Jay are talking about, the traffic we're seeing digitally off of those campaigns, is significant.

Speaker #4: And that's where we're seeing a lot of the gains from those efforts and from the effectiveness of those campaigns. So digital was positive in Q3, but digital was on the high end of the high single-digit level.

And in a very specifically, I mean, as I mentioned before men's, we saw incredible an incredible turnaround, um, and Airy specifically all categories are working. Look, the team when you have to Pivot coming off of q1, um, we focused on our product and winning that customer back and ensuring that we could get that momentum. Um that we deserve again. This brand is incredible and I did want to say I I need to remind everyone on this call. That Aries brand awareness is only at 55 to 60%.

Speaker #4: For Q3, we would expect for Q4 to be a plus 8 to 9, with the same kind of outcome where digital would really outpace stores. We've seen that through November and especially over the holiday weekend, where both channels were positive. We were happy with the success in both channels, but digital is where we're seeing the outpaced growth.

Mike Mathias: We've seen that through November and especially over the holiday weekend here where both channels were positive, and we were happy with success in both channels, but digital is where we're seeing the outpaced growth at the moment.

We've seen that through November and especially over the holiday weekend here where both channels were positive, and we were happy with success in both channels, but digital is where we're seeing the outpaced growth at the moment.

Speaker #4: the moment. And

So when I think about our opportunity as we, um, you know, uh, build into 202 2026, we have an incredible runway in front of us. So, um, we're pulling in product as we speak. We're chasing, um, and the teams working fast and furiously, so that we can continue this momentum into, um, next year,

Speaker #3: And in Erie specifically, I mean, as I mentioned before, men's, we saw an incredible turnaround. In Erie specifically, all categories are working. Look, the team, when you have to pivot coming off of Q1, we focused on our product and winning that customer back and ensuring that we could get that momentum that we deserve again.

Jen Foyle: In Aerie specifically, I mean, as I mentioned before, men's, we saw an incredible turnaround. In Aerie specifically, all categories are working. Look, the team, when you have to pivot coming off of Q1, we focused on our product and winning that customer back and ensuring that we could get that momentum that we deserve again. This brand is incredible. And I did want to say, I need to remind everyone on this call that Aerie's brand awareness is only at 55% to 60%. So when I think about our opportunity as we build into 2026, we have an incredible runway in front of us. So we're pulling in product as we speak. We're chasing, and the team's working fast and furiously so that we can continue this momentum into next year.

I, I'd like to say that, yes.

All right, thank you guys. Best of luck.

And the next question comes from Alex strips Stratton with Morgan Stanley. Please go ahead.

Speaker #3: This brand is incredible. And I did want to say, I need to remind everyone on this call that Erie's brand awareness is only at 55 to 60 percent.

Thanks so much and and congrats on a nice quarter.

Speaker #3: So, when I think about our opportunity as we build into 2026, we have an incredible runway in front of us. So, we're pulling in product as we speak.

Speaker #3: We're chasing, and the teams are working fast and furiously so that we can continue this momentum into next.

Speaker #3: year. And also,

Um, all these big campaigns that you guys have pursued, can you just give us some context on on where you think you'll end the year? Um, on marketing expense as a percentage of sales versus typical like are you investing more than history? And then as we think about next year, should should that lie item continue to to move higher. Um, or how do you think about kind of that flywheel between the marketing investment and and growth

Judy Meehan: Also, Jen, I think our merchandise is better too, which helps.

Jay Schottenstein: Also, Jen, I think our merchandise is better too, which helps.

Speaker #2: Jen, I think our merchandise is better too. Which helps.

Speaker #3: I'd like to say that,

Jen Foyle: I'd like to say that, yes.

Speaker #3: yes. All right.

Chris Nardone: All right. Thank you, guys. Best of luck.

Speaker #6: Thank you, guys. Best of luck. And the next question comes from Alex Stratton with Morgan Stanley. Please go

Operator: The next question comes from Alex Straton with Morgan Stanley. Please go ahead.

Speaker #6: ahead. Thanks so

Alex Straton: Thanks so much, and congrats on a nice quarter. On these big campaigns that you guys have pursued, can you just give us some context on where you think you'll end the year on marketing expense as a percentage of sales versus typical? Are you investing more than history? And then as we think about next year, should that line item continue to move higher? Or how do you think about kind of that flywheel between the marketing investment and growth?

Speaker #11: Much. And congrats on a nice quarter. On these big campaigns that you guys have pursued, can you just give us some context on where you think you'll end the year on marketing expense as a percentage of sales versus typical?

Um, for this year yes. We're I mean obviously we've made a significant investment in Q3 Q4 is up as well within our guidance. Not not anywhere near the increase. From on a percentage basis to Q3 was um really pleased with the STNA leverage. We'll see in Q4 off of this comp guide advertising is still deleveraging a bit but we're leveraging. All other expense categories as intended. Pretty significantly in the fourth quarter for the year, we're going to wind up somewhere in the mid fours as a percentage. Um and historically we've been more in the like last year for example, around 4%. Um so we're definitely resetting

Speaker #11: Are you investing more than in the past? And then, as we think about next year, should that line item continue to move higher? How do you think about the flywheel between marketing investment and growth?

Speaker #4: For this year, yes, I mean, obviously, we made a significant investment in Q3. Q4 is up as well within our guidance, not anywhere near the increase on a percentage basis that Q3 was.

Mike Mathias: For this year, yes. I mean, obviously, we've made a significant investment in Q3. Q4 is up as well within our guidance, not anywhere near the increase on a percentage basis that Q3 was. Really pleased with the SG&A leverage we'll see in Q4 off of this comp guide. Advertising is still deleveraging a bit, but we're leveraging all other expense categories as intended pretty significantly here in the fourth quarter. For the year, we're going to wind up somewhere in the mid-4s%. And historically, we've been more in the, I think, last year, for example, around 4%. So we're definitely resetting a baseline for advertising spend at the moment. It's working. We're continuing to monitor it.

A baseline for advertising spend at the moment. Um, it's working. We're, we're continuing to monitor it monitor it. Uh, Jen. And I have, and our teams are working very closely and cross-functionally on really on a week to week basis how we're pulsing the spend and advertising on top of the campaigns that are obviously planned. Well, ahead of time. Uh, I'd expect we expect in our initial plans here for next year, is to continue this in the first half.

Speaker #4: Really pleased with the SDNA leverage we'll see in Q4 off of this comp guide. Advertising is still deleveraging a bit, but we're leveraging all other expense categories as intended pretty significantly in the fourth quarter.

Um, possibly passing more toward a 5% type of rate, to reset ourselves, and then leverage leverage, all our expense lines funnels, some expense, or some investment toward advertising.

Speaker #4: For the year, we're going to wind up somewhere in the mid-fours as a percentage. Historically, we've been more in the last year, for example, around 4%.

Speaker #4: So we're definitely resetting a baseline for advertising spend at the moment. It's working. We're continuing to monitor it. Jen and I and our teams are working very closely and cross-functionally on really on a week-to-week basis how we're pulsing the spend in advertising on top of the campaigns that are obviously planned well ahead of time.

Uh in anniversary. This come next, you know, next next year around this time in the third quarter I think that's 5% is a good, sweet spot that we'd like to maintain over time so as we're kind of resetting, the Baseline, we're passing toward 5%, like the Topline growth, we're seeing from it. Um,

again, just to reiterate anniversary it, come next year and start to just maintain that type of rate and we'll evaluate things from their

Mike Mathias: Jen and I and our teams are working very closely and cross-functionally on really on a week-to-week basis how we're pulsing the spend in advertising on top of the campaigns that are obviously planned well ahead of time. We expect in our initial plans here for next year to continue this in the first half, possibly pathing more toward a 5% type of rate to reset ourselves and then leverage all our expense lines, funnel some expense or some investment toward advertising. And anniversary this come next year around this time in Q3. I think that 5% is a good sweet spot that we'd like to maintain over time. So as we're kind of resetting the baseline, we're pathing toward 5%, like the top-line growth we're seeing from it.

Jen and I and our teams are working very closely and cross-functionally on really on a week-to-week basis how we're pulsing the spend in advertising on top of the campaigns that are obviously planned well ahead of time. We expect in our initial plans here for next year to continue this in the first half, possibly pathing more toward a 5% type of rate to reset ourselves and then leverage all our expense lines, funnel some expense or some investment toward advertising. And anniversary this come next year around this time in Q3. I think that 5% is a good sweet spot that we'd like to maintain over time. So as we're kind of resetting the baseline, we're pathing toward 5%, like the top-line growth we're seeing from it.

Speaker #4: I’d expect in our initial plans here for next year to continue this in the first half. Possibly pathing more toward a 5% type of rate to reset ourselves and then leverage all our expense lines, funnel some expense or some investment toward advertising, and anniversary this coming next year around this time in the third quarter.

and Mike, Mike and we have some more tricks in the bank too. We're not saying, but yeah, the more to come, we'll talk, uh, leave some things on our fourth quarter, call in March, probably to talk about, uh, more exciting things to come.

Speaker #4: I think that 5% is a good sweet spot that we'd like to maintain over time. So as we're kind of resetting the baseline, we're pathing toward 5%.

Speaker #4: Like the top line growth we're seeing from it, again, just to reiterate, anniversary come next year and start to just maintain that type of rate, and we'll evaluate things from there.

Terrorists. Can you just like, big picture, talk about, you know, where you've made the most progress versus that plan and and and where there's still more work to be done in this in this final year here.

Mike Mathias: Again, just to reiterate, anniversary it'll come next year and start to just maintain that type of rate, and we'll evaluate things from there.

Again, just to reiterate, anniversary it'll come next year and start to just maintain that type of rate, and we'll evaluate things from there.

yeah, I mean, I stopped on starting the top line, I know it would be obviously a few missteps here in the first half of the year in the first quarter, but the net result of this year

Speaker #2: And Mike, can we have some more tricks in the bag too? We're not saying we have more tricks in the bag.

Judy Meehan: And Mike, Mike, and we have some more tricks in the bag too. We're not saying we have more tricks in the bag.

Jay Schottenstein: And Mike, Mike, and we have some more tricks in the bag too. We're not saying we have more tricks in the bag.

Speaker #4: Yeah, the more to come. We'll talk; we have some things on our fourth quarter call in March, probably to talk about more exciting things to come.

Mike Mathias: Yeah. More to come. We'll talk. We have some things on our fourth quarter call in March, probably, to talk about more exciting things to come.

with this guide is actually going to wind up kind of in that low to mid single or, you know, within the algorithm we've talked about wanting to achieve every year. Um,

so, you know, we'll be at a kind of low single digit uh, trajectory on the full year with this back half being

Speaker #11: That's great. Maybe one follow-up for you, Mike. Just kind of zooming out here, I know there's been some wrenches in your medium-term outlook. Since you've provided it a couple of years ago, but maybe as we move into the final year of that plan and excluding some of the non-controllable headwinds like tariffs, can you just big picture talk about where you've made the most progress versus that plan and where there's still more work to be done in this final year

Alex Straton: That's great. Maybe one follow-up for you, Mike. Just kind of zooming out here. I know there's been some wrenches in your medium-term outlook since you provided it a couple of years ago. But maybe as we move into the final year of that plan and excluding some of the non-controllable headwinds like tariffs, can you just big picture talk about where you've made the most progress versus that plan and where there's still more work to be done in this final year here?

You know, kind of the mid to high mid to high single digit range. So I think that's the continued Focus. Um I'd also say we made a lot of Headway and just the culture change around expenses in total. So we continue to control costs to cross the p&l.

Speaker #11: here? Yeah.

Mike Mathias: Yeah. I mean, I'll stop on starting the top line. I know we obviously had a few missteps here in the first half of the year in the first quarter, but the net result of this year with this guide is actually going to wind up kind of in that low to mid-single or within the algorithm we've talked about wanting to achieve every year. So we'll be at a kind of low single-digit trajectory on a full year with this back half being kind of the mid to high single-digit range. So I think that's the continued focus. I'd also say we made a lot of headway in just the culture change around expenses in total. So we continue to control costs across the P&L.

Speaker #4: I mean, I'll stop on starting the top line. I know we obviously had a few missteps here in the first half of the year, in the first quarter, but the net result of this year, with this guide, is actually going to wind up kind of in that low to mid-single or within the algorithm we've talked about wanting to achieve every year.

Speaker #4: So, we'll be at a kind of low single-digit trajectory on a full year, with this back half being kind of mid to high single-digit range.

Speaker #4: So I think that's a continued focus. I'd also say we made a lot of headway in just the culture change around expenses in total.

Um, I think the leverage that we see that we're seeing here in Bow, um, this back half of the year and then sgna in this fourth quarter is a testament to that even with the significant increase in advertising this year that you know, you just asked about. And I just provided to Keller on all the other sdna line items are leveraging in this year and sgna in total will be relatively flat uh, on the year at the uh, kind of the low single digit total year outcome. So I think that's a big change for us over the last several years. It's been a massive Focus to have a different mentality around, controlling expense, it's allowing us to funnel some of these dollars toward advertising and so we'll continue to do that. Um, and yeah, to your point, you know, the

Pair of headwind is something we can't control. But I mean, our goal is still this 10%. Aspiration tariffs are going to set that back a little bit.

Speaker #4: So we continue to control costs across the P&L. I think the leverage that we're seeing here in BOW, this back half of the year, and then SG&A in this fourth quarter is a testament to that.

Mike Mathias: I think the leverage that we're seeing here in BOW this back half of the year and then SG&A in this fourth quarter is a testament to that. Even with the significant increase in advertising this year that you just asked about, I just provided to Keller on, all the other SG&A line items are leveraging in this year. SG&A in total will be relatively flat on the year at the kind of the low single-digit total year outcome. So I think that's a big change for us over the last several years. It's been a massive focus to have a different mentality around controlling expense. It's allowing us to funnel some of these dollars toward advertising. And so we'll continue to do that. And yeah, to your point, the tariff headwind is something we can't control, but I mean, our goal is still this 10% aspiration.

I think the leverage that we're seeing here in BOW this back half of the year and then SG&A in this fourth quarter is a testament to that. Even with the significant increase in advertising this year that you just asked about, I just provided to Keller on, all the other SG&A line items are leveraging in this year. SG&A in total will be relatively flat on the year at the kind of the low single-digit total year outcome. So I think that's a big change for us over the last several years. It's been a massive focus to have a different mentality around controlling expense. It's allowing us to funnel some of these dollars toward advertising. And so we'll continue to do that. And yeah, to your point, the tariff headwind is something we can't control, but I mean, our goal is still this 10% aspiration.

Speaker #4: Even with the significant increase in advertising this year that you just asked about, and I just provided to Keller on, all the other SG&A line items are leveraging in this year.

But we're going to continue down the path that we're on on controlling all other costs, investing some dollars in advertising, uh, fueling area and offline, um, you know, hitting that kind of low single plus trajectory in AE and uh, you know, passing back toward that 10% that is still our ultimate goal.

Yeah, am I you know?

As a general thing.

Speaker #4: And SG&A in total will be relatively flat. On the year, at the kind of the low single-digit total year outcome. So I think that's a big change for us over the last several years.

this team after the first quarter and, you know, Jen couldn't emphasize it enough

Really took a hard look at everything.

We went through all the different areas of the business.

Every single area.

Speaker #4: It's been a massive focus to have a different mentality around controlling expenses, allowing us to funnel some of these dollars toward advertising. And so we'll continue to do that.

Every opportunity.

Speaker #4: And yeah, to your point, the tariff headwind is something we can't control. But, I mean, our goal is still this 10% aspiration; tariffs are going to set that back a little bit.

The merchandise to the operations looking where, you know, you know what, you know, what's important, what's not important, the company.

Mike Mathias: Tariffs are going to set that back a little bit, but we're going to continue down the path that we're on, on controlling all other costs, investing some dollars in advertising, fueling Aerie and OFFLINE, hitting that kind of low single-plus trajectory in AE, and pathing back toward that 10%. That is still our ultimate goal.

Tariffs are going to set that back a little bit, but we're going to continue down the path that we're on, on controlling all other costs, investing some dollars in advertising, fueling Aerie and OFFLINE, hitting that kind of low single-plus trajectory in AE, and pathing back toward that 10%. That is still our ultimate goal.

Speaker #4: But we're going to continue down the path that we're on, controlling all other costs, investing some dollars in advertising, fueling area and offline, hitting that kind of low single plus trajectory in AE, and pathing back toward that 10% that is still our ultimate goal.

the dedication of the associates have been amazing, the last few months, and I'm so proud of this team because that first quarter we got kicked very hard and nobody quits

Speaker #11: Yeah. And Mike, as a general thing, this team after the first quarter and Jen couldn't emphasize it enough, really took a hard look at everything.

Judy Meehan: Yeah. And Mike, as a general thing, this team, after the first quarter, and Jen couldn't emphasize it enough, really took a hard look at everything. We went through all the different areas of the business, every single area, every opportunity, from the merchandise to the operations, looking where what's important, what's not important in the company. The dedication of the associates has been amazing the last few months. And I'm so proud of this team because that first quarter, we got kicked very hard, and nobody quit. Nobody cried about it. Nobody quit. Everybody went to figure out how can we do things better, transformational, looking for where the real opportunities are, looking for where we should go in the future, where the opportunities are, and what's it going to take to be the best.

Jay Schottenstein: Yeah. And Mike, as a general thing, this team, after the first quarter, and Jen couldn't emphasize it enough, really took a hard look at everything. We went through all the different areas of the business, every single area, every opportunity, from the merchandise to the operations, looking where what's important, what's not important in the company. The dedication of the associates has been amazing the last few months. And I'm so proud of this team because that first quarter, we got kicked very hard, and nobody quit. Nobody cried about it. Nobody quit. Everybody went to figure out how can we do things better, transformational, looking for where the real opportunities are, looking for where we should go in the future, where the opportunities are, and what's it going to take to be the best.

Nobody cried about it. Nobody quit, everybody went to figure out, how can we do things? Better transformational looking for, where the real opportunities are looking for, where we should go in the future, where the opportunities are and what's going to take to be the best? And 1 thing, I'm very proud of. If you go into our stores, we have the best looking stores, the best maintained stores in the mall. If you walk in the mall our stores, look, the best.

Speaker #11: We went through all the different areas of the business, every single area, every opportunity: the merchandise, the operations, looking at what's important and what's not important to the company. The dedication of the associates has been amazing the last few months.

Speaker #11: And I'm so proud of this team because that first quarter, we got kicked very hard and nobody quit. Nobody cried about it. Nobody quit.

If you go look at our new store stores, you go to down to solo and you look at our new store. We just opened in SoHo, you go to Aventura down in Miami, you'd be very impressed by the stores. They're very, very impressive stores, they're very functional stores. And so, you know, I think that, you know, that we're very excited. I know what we have planned for marketing next year. I know where the merchants are focused. I know, I know the excitement that everybody has in this company and um,

Speaker #11: Everybody went to figure out how can we do things better. Transformational, looking for where the real opportunities are, looking for where we should go in the future, where the opportunities are, and what's it going to take to be the best.

It's going to be great.

And the next question comes from Janet,

Poppenberg with jjk research, Associates, please go ahead, go ahead.

Speaker #11: And one thing I'm very proud of, if you go into our stores, we have the best-looking stores, the best-maintained stores in the mall. If you walk in the mall, our stores look the best.

Judy Meehan: One thing I'm very proud of, if you go into our stores, we have the best-looking stores, the best-maintained stores in the mall. If you walk in the mall, our stores look the best. If you go look at our new stores, you go down to Soho and you look at our new store we just opened in Soho. You go to Aventura down in Miami, you'd be very impressed by the stores. They're very, very impressive stores. They're very functional stores. And so I think that we're very excited. I know what we have planned for marketing next year. I know where the merchants are focused. I know the excitement that everybody has in this company. And it's going to be great.

One thing I'm very proud of, if you go into our stores, we have the best-looking stores, the best-maintained stores in the mall. If you walk in the mall, our stores look the best. If you go look at our new stores, you go down to Soho and you look at our new store we just opened in Soho. You go to Aventura down in Miami, you'd be very impressed by the stores. They're very, very impressive stores. They're very functional stores. And so I think that we're very excited. I know what we have planned for marketing next year. I know where the merchants are focused. I know the excitement that everybody has in this company. And it's going to be great.

Speaker #11: If you go look at our new stores, if you go down to Soho and you look at our new store we just opened in Soho, you go to Aventura down in Miami, you'd be very impressed by the stores.

Hi, everybody, and congratulations. And today, I believe the school. The school is look, terrific. Um, area in particular, but uh, American Eagle as well. Um, I just wanted to ask about, um,

Speaker #11: They're very, very impressive stores. They're very functional stores. So I think that we're very excited. I know what we have planned for marketing next year.

Speaker #11: I know where the merchants are focused. I know the excitement that everybody has in this company, and it's going to be great.

I think you have to chase product earlier in the year as well. Um, Jen. And I'm wondering what's going on there and if that situation is resolved, now, with the comps being as healthy as they are,

um, and then for for Mike, um,

on a 4%.

Comp.

Speaker #1: And the next question comes from Janet Foppenberg with JJK Research Associates. Please go ahead.

Operator: The next question comes from Janet Kloppenburg with JJK Research Associates. Please go ahead.

Speaker #12: Go Go ahead.

Speaker #13: Hi, everybody, and congratulations and say I agree the stores look terrific. AOE in particular, but American Eagle as well. I just wanted to ask about I think you had to chase product earlier in the year as well.

Jen Foyle: Go ahead.

Jay Schottenstein: Go ahead.

Janet Kloppenburg: Hi everybody, and congratulations. And Jay, I agree. The stores look terrific. Aerie in particular, but American Eagle as well. I just wanted to ask about, I think you had to chase product earlier in the year as well, Jen, and I'm wondering what's going on there and if that situation is resolved now with the comps being as healthy as they are. And then for Mike, on a 4% comp, you weren't able, did you leverage buying and occupancy? I think you may have. And what is the target point on that? And in terms of price increases, are they all behind you now? Have you taken them all, or are there more to come? Thank you.

Um, you weren't able did, did you leverage uh, be uh, buying an occupancy? I think you may have. And what is the, is the target point on that? And in terms of price increases,

um,

They all behind you now. Have you taken them all or are there more to come? Thank you.

Speaker #13: Jen, and I'm wondering what's going on there. And if that situation is resolved now with the comps being as healthy as they are, and then for Mike, on a 4% comp, you weren't able—did you leverage buying an occupancy?

Speaker #13: I think you may have. And what is the target point on that? And in terms of price increases, are they all behind you now?

Speaker #13: Have you taken them all? Or are there more to come? Thank you.

Speaker #13: you. Yes.

Jen Foyle: Yes, for sure. Thanks, by the way, Jen. Primarily, it's been in women's denim, to be frank. We've been sort of in chase mode since Q1. And quite frankly, we haven't been able to keep up with the demands. And as you know, we have a huge shorts business, and that business never really turned on. We expect shorts to turn on as we enter Q2, back half of Q1 into Q2, and that never happened. So then we continued to see this demand in long legs, and we really couldn't keep up with that demand. So moving into Q3, we felt like we were in a better position, but we wanted to be prudent as well with our inventories. As you know, denim is probably our higher cost of goods as well, but it's our biggest business. So it's always an art managing that business.

Speaker #14: For sure. Thanks, by the way, Janet. It's primarily been in women's denim, to be frank. We've been sort of in chase mode since Q1, and quite frankly, we haven't been able to keep up with the demands.

Um, we it's primarily it's been in women's denim to be frank. Um, we've been sort of on, in Chase mode since q1, um and right, you know, quite frankly we haven't been able to keep up with the demands and, you know, as you, you know, we have a huge short business and that business never really turned on. You know, we expect shorts to turn on, as we enter Q2, you know, back half of q1 into Q2 and that never happens. So then we continue to see this demand in Long Legs. Um, and we really couldn't keep up with that demand. So, moving into Q3, um, you know, we we felt like we were in a better position but we wanted to be prudent as well with our inventories. Um, as as you know, denim is probably our higher cost of goods as well, but it's our biggest business. So it's always an art managing that business and, um, with the launch of the Sydney Sweeney and actually Travis, um, you know, we couldn't really keep up with that demand. Uh, the teams worked swiftly,

We were definitely in the right businesses. We definitely had the right silos and the right investment in silhouettes.

Speaker #14: And as you know, we have a huge short business, and that business never really turned on. We expect shorts to turn on as we enter Q2, back half of Q1 into Q2.

Speaker #14: And that never happened. So then we continue to see this demand in long legs, and we really couldn't keep up with that demand. Moving into Q3, we felt like we were in a better position, but we wanted to be prudent as well with our inventories.

Um, which led to some of that out of stock. Um, good news there, uh, bad news. We needed a little bit more inventory to carry and, and to, and to get that business move, you know, to get women's in total, um, because of the penetration of denim. So good news is, uh, certainly in the back, half of 23. Um, we saw a nice, um, levels of inventory getting back into our keys,

Speaker #14: As you know, denim is probably our higher cost of goods as well, but it's our biggest business. So it's always an art. Managing that business.

Speaker #14: And with the launch of the Sydney Sweeney and actually Travis, we couldn't really keep up with that demand. The teams worked swiftly. We were definitely in the right businesses.

Jen Foyle: With the launch of the Sydney Sweeney and actually Travis, we couldn't really keep up with that demand. The teams worked swiftly. We were definitely in the right businesses. We definitely had the right silos and the right investment in silhouettes, which led to some of that out of stock. Good news there. Bad news, we needed a little bit more inventory to carry and to get that business moved, to get women's in total because of the penetration of denim. So good news is certainly in the back half of Q3, we saw nice levels of inventory getting back into our key silhouettes. The top five jeans, just to give you some perspective, we planned at—this is just top five jean styles in women's. We planned up 25%. They were up 50% on demand. So we had a lot of work to do.

With the launch of the Sydney Sweeney and actually Travis, we couldn't really keep up with that demand. The teams worked swiftly. We were definitely in the right businesses. We definitely had the right silos and the right investment in silhouettes, which led to some of that out of stock. Good news there. Bad news, we needed a little bit more inventory to carry and to get that business moved, to get women's in total because of the penetration of denim. So good news is certainly in the back half of Q3, we saw nice levels of inventory getting back into our key silhouettes. The top five jeans, just to give you some perspective, we planned at—this is just top five jean styles in women's. We planned up 25%. They were up 50% on demand. So we had a lot of work to do.

Speaker #14: We definitely had the right silos and the right investment in silhouettes, which led to some of that out of stock. Good news there. Bad news, we needed a little bit more inventory to carry and to get that business to get women's in total.

Silhouettes, the top 5 jeans, just to give you some perspective, we planned at up, this is you know, just top 5 jean styles in women's we planned up 25%. They were up 50% on demand so um we had a lot of work to do, we still better as we head into Q4 and nodding to what Mike mentioned. Um we're going to look at Denham a little bit differently so that we're all you know, we're maintaining that business while we grow new categories.

Speaker #14: Because of the penetration of denim, the good news is that certainly in the back half of Q3, we saw a nice level of inventory getting back into our key silhouettes.

Speaker #14: The top five jeans, just to give you some perspective, we planned at—this is just the top five jean styles in women's. We planned up 25%.

Yes, we did Leverage BW by 20 basis points in the third quarter, on the 4, compared to us that low to mid single digit results to leverage expense, really across the board other than this advertising, reset we're talking about. Um, and then the fourth quarter on the 8 to 9 comp, we'd obviously definitely expect to leverage vow with that kind of result as well. And sgna will leverage significantly on that, kind of result for the fourth quarter.

Okay.

And then just some pricing.

Speaker #14: They were up 50% on demand. So we had a lot of work to do. We feel better as we head into Q4. And nodding to what Mike mentioned, we're going to look at denim a little bit differently so that we're maintaining that business while we grow new categories.

Jen Foyle: We felt better as we headed into Q4. Nodding to what Mike mentioned, we're going to look at denim a little bit differently so that we're maintaining that business while we grow new categories.

We felt better as we headed into Q4. Nodding to what Mike mentioned, we're going to look at denim a little bit differently so that we're maintaining that business while we grow new categories.

Speaker #1: And, and Jen, BOW—yes, we did leverage BOW by 20 basis points in the third quarter on the four comp. And then that's a good target for us, that low to mid single-digit result to leverage expense really across the board, other than this advertising reset we’re talking about.

Mike Mathias: Jen, on BOW, yes, we did leverage BOW by 20 basis points in Q3 on the 4 comp. That's a good target for us, that low to mid-single-digit result to leverage expense really across the board other than this advertising reset we're talking about. Q4 on the 8 to 9 comp, we obviously definitely expect to leverage BOW at that kind of result as well. SG&A will leverage significantly on that kind of result for Q4.

Yeah, we talked about a little earlier, we're not. I mean, the aors flat for Q3. We're expecting similar Aur in Q4. We're not, uh, passing through the impact of tears to the consumer purposely. Um, we are taking our shots on price moves, where, you know, as Jenna said keeping maintaining that price value equation that our customers expects and making sure we're not impacting conversion.

Speaker #1: And then the fourth quarter on the eight to nine comp, we'd obviously expect to leverage BOW at that kind of result as well.

Um, and giving ourselves a little room on the promotional side when we do that as well. So we'll continue to kind of optimize that take our shots, but uh, you know, net Aur similar to last year, um, is the intent.

Speaker #1: And SG&A will leverage significantly on that kind of result for the fourth quarter.

And the next question comes from Janine, Stitcher with the tig, please go ahead.

Speaker #15: Okay. And then just on pricing?

Janet Kloppenburg: Okay. And then just on pricing?

Speaker #1: Yeah, we talked about it a little earlier. We're not—I mean, AOR is flat for Q3. We're expecting similar AOR in Q4. We're not passing through the impact of tariffs to the consumer purposely.

Mike Mathias: Yeah. We talked about it a little earlier. I mean, the AUR is flat for Q3. We're expecting similar AUR in Q4. We're not passing through the impact of tariffs to the consumer purposely. We are taking our shots on price moves where, as Jen has said, maintaining that price value equation that our customer expects and making sure we're not impacting conversion and giving ourselves a little room on the promotional side when we do that as well. So we'll continue to kind of optimize that, take our shots, but net AUR similar to last year is the intent.

Speaker #1: We are taking our shots on price moves, whereas Jen has said, maintaining that price value equation that our customers expect and making sure we're not impacting conversion.

Hi. Thanks for taking my question and congrats on. I'm a great quarter. Um, you know, with the quarter to date acceleration, it sounds like a lot of it's been driven by traffic and new customer acquisition, this 1 conversion, particularly with some of the product improvements you've made and then maybe if you can just share your thoughts, um, on the Gen Z consumer. We've certainly heard a lot about that consumer, potentially being pressured and pulling back. But doesn't seem like you're seeing that at all in your business. So I would just love to hear your thoughts on kind of where the consumer is and and how they're sending.

Speaker #1: And giving ourselves a little room on the promotional side when we do that as well. So we'll continue to kind of optimize that, take our shots, but net AUR, similar to last year, is the intent.

Speaker #1: And the next question comes from Janine Stitcher with BTIG. Please go ahead.

Operator: The next question comes from Janine Stichter with BTIG. Please go ahead.

Speaker #1: Hi, thanks for taking my call.

Jay Schottenstein: Hi. Thanks for taking my question. Congrats on a great quarter. With this quarter-to-date acceleration, it sounds like a lot of it's been driven by traffic and new customer acquisition. Just wondering what you're seeing on conversion, particularly with some of the product improvements you've made. And then maybe if you can just share your thoughts on the Gen Z consumer. We've certainly heard a lot about that consumer potentially being pressured and pulling back, but it doesn't seem like you're seeing that at all in your business. So we'd just love to hear your thoughts on kind of where the consumer is and how they're spending.

Janine Stichter: Hi. Thanks for taking my question. Congrats on a great quarter. With this quarter-to-date acceleration, it sounds like a lot of it's been driven by traffic and new customer acquisition. Just wondering what you're seeing on conversion, particularly with some of the product improvements you've made. And then maybe if you can just share your thoughts on the Gen Z consumer. We've certainly heard a lot about that consumer potentially being pressured and pulling back, but it doesn't seem like you're seeing that at all in your business. So we'd just love to hear your thoughts on kind of where the consumer is and how they're spending.

Speaker #16: Congrats on a great quarter. With this quarter-to-date acceleration, it sounds like a lot of it's been driven by traffic and new customer acquisition.

Speaker #16: Just wondering what you're seeing on conversion, particularly with some of the product improvements you've made? And then maybe, if you can just share your thoughts on the Gen Z consumer.

Yeah, I think uh, on the metric side of things traffic was definitely a driver in Q3 we continue to see that here in the fourth quarter or you know through November um with Aur flat it's been a mix of sort of traffic and then ads or you know, the Upp part of the ads, equation, Aur, flat, some uptick in upts and then traffic with conversion being relatively flat with Aur being relatively flat. So that's where your mix of metrics that we saw in the third quarter. And, you know, early days here in Q4 obviously a big traffic uptick that we've capitalized on through November and do Thanksgiving. And we'll see how that continues to play out but with

Speaker #16: We've certainly heard a lot about that consumer potentially being pressured and pulling back, but it doesn't seem like you're seeing that at all in your business.

Speaker #16: So, we'd just love to hear your thoughts on kind of where the consumer is and how they're.

You are relatively flat would assume a similar kind of mix of metrics traffic being a driver ads. Being a driver with Aur flat conversion, relatively flat. Um, we'll see how it pans out through December.

Yeah, we are.

Speaker #1: Yeah, I think

Mike Mathias: Yeah. I think on the metric side of things, traffic was definitely a driver in Q3. We continue to see that here in the fourth quarter through November. With AUR flat, it's been a mix of sort of traffic and then ADS or the UPT, part of the ADS equation. AUR flat, some uptick in UPTs, and then traffic with conversion being relatively flat, with AUR being relatively flat. So that's sort of your mix of metrics that we saw in the third quarter and early days here in Q4. Obviously, a big traffic uptick that we've capitalized on through November and through Thanksgiving, and we'll see how that continues to play out. But with AUR relatively flat, we'd assume a similar kind of mix of metrics, traffic being a driver, ADS being a driver with AUR flat, conversion relatively flat. We'll see how it pans out through December.

Speaker #1: On the metric side of things, traffic was definitely a spending driver in Q3. We continue to see that here in the fourth quarter. Through November, with AUR flat, it's been a mix of sort of traffic and then ADS, or the UPT part of the ADS equation.

Speaker #1: AUR flat, some uptick in UPTs. And then traffic with conversion being relatively flat, with AUR being relatively flat. That's sort of your mix of metrics that we saw in the third quarter and early days here in Q4.

Speaker #1: Obviously, a big traffic uptick that we've capitalized on through November and through Thanksgiving. And we'll see how that continues to play out. But with AUR relatively flat, we'd assume a similar kind of mix of metrics—traffic being a driver, ADS being a driver with AUR flat, conversion relatively flat.

We're seeing momentum in, um, all age groups. Um, we do have still some opportunity on the lower age, um, scale in AE, women's, in particular, um, and we're up to, um, you know, invigorating some product to entertain that age bracket, but honestly, um, you know, we we're not seeing it. Um, and also, this is a critical time to for gift giving to. So we see Mom and Dad out their purchasing as well.

Okay, we have time for 1 more question.

Speaker #1: And we'll see how it pans out through December.

Speaker #15: Yeah, we're not feeling that we're entertaining Gen Z in all of our brands. So even when you look at Martha Stewart, that might be a question mark, right?

Jen Foyle: Yeah. We're not feeling that. We're entertaining Gen Z in all of our brands. So even when you look at Martha Stewart, that might be a question mark, right? Why Martha Stewart? But Martha Stewart resonates with Gen Z. That's a perfect example of what we're up to. We're seeing momentum in all age groups. We do have still some opportunity on the lower age scale in AE, women's in particular, and we're up to invigorating some product to entertain that age bracket. But honestly, we're not seeing it. And also, this is a critical time too for gift-giving too. So we see mom and dad out there purchasing as well.

And then last question comes from Corey tarlow with Jeffrey. Please go ahead.

Um, great, thanks for taking my question, Mike. I just wanted to ask on sgna um,

Speaker #15: Why Martha Stewart? Because Martha Stewart resonates with Gen Z. That's a perfect example of what we're up to. We're seeing momentum in all age groups.

For Q3 and Q4 and just kind of have to think about it next year, from a dollar perspective. Is there anything that?

Speaker #15: We do have still some opportunity on the lower age scale in AE women's in particular. And we're up to invigorating some product to entertain that age bracket.

Speaker #15: But honestly, we're not seeing it. And also, this is a critical time for giving, too. So we see Mom and Dad out there purchasing as...

Either comes in or goes out whether it's marketing. Um, I think you talked, maybe you talked about incentives comp and in in Prior years, uh, how to think about that. Um, just structurally understanding on a rate basis, obviously, with Q4 sales being so strong. There's going to be a bit of a Delta there, but curious what you could unpack for us. Thanks so much.

Speaker #15: well. Great.

Speaker #16: Okay, we have time for one more question.

Jay Schottenstein: Okay. We have time for one more question.

Judy Meehan: Okay. We have time for one more question.

Speaker #16: question. And

Speaker #1: And then, the last question comes from Cory Tarlow with Jefferies. Please go ahead.

Operator: The last question comes from Corey Tarlowe with Jefferies. Please go ahead.

Speaker #1: ahead. Great.

Mike Mathias: Great. Thanks for taking my question. Mike, I just wanted to ask on SG&A for Q3 and Q4 and just kind of how to think about it next year from a dollar perspective. Is there anything that either comes in or goes out, whether it's marketing? I think maybe you talked about incentive comp in prior years. How to think about that just structurally? Understanding on a rate basis, obviously, with Q4 sales being so strong, there's going to be a bit of a delta there, but curious what you could unpack for us. Thanks so much. Sure. Yeah. I think, as I said, we'd expect to see some continued investment in advertising through the first half of next year, incremental to where we've been. Intention to path toward, we'll call it, that 5% rate annually. So we'll anniversary things in the back half that we're doing currently.

Speaker #17: Thanks for taking my question. Mike, I just wanted to ask on SG&A. For Q3 and Q4, and just kind of how to think about it next year from a dollar perspective, is there anything that either comes in or goes out, whether it's marketing, I think you talked—maybe you talked about incentive comp in prior years, how to think about that, just structurally understanding on a rate basis, obviously with Q4 sales being so strong.

Sure. Yeah, I think as I said I would expect to see some continued investment advertising through the first half of next year incremental, to where we've been, um, intention to path towards, uh, we'll call it at 5% rate annually. So anniversary things in the back, half that we're doing, uh, currently. Um, incentive composite of a TBD. Uh, we're still setting plans for 2026. Um, does annual book plans are based on specific. Our ebit Target is the success metrics, so we'll probably we'll give more Keller in March around 2026 STNA and how we think, that'll pan out by quarter.

uh with advertising and possibly a bit of more incentive comp in the mix, um, the more to come in March,

Speaker #17: There's going to be a bit of a delta there, but curious what you could unpack for us. Thanks so much.

Speaker #17: much.

Speaker #1: Sure.

Speaker #1: Yeah, I think, as I said, we'd expect to see some continued investment in advertising through the first half of next year, incremental to where we've been.

Speaker #1: Intention to path toward—we'll call it that 5% rate annually. So, we'll anniversary things in the back half that we're doing currently. Incentive comp is a bit of a TBD.

Great. Thanks. And then just a quick follow-up on our. The momentum has been very, very strong, um, curious what you think is, um, specifically working there versus the competition. When you either walk the mall or or, or View, kind of the competitive set. How you think about your, your market share gains in the opportunity there. Thanks so much.

Mike Mathias: Incentive comp is a bit of a TBD. We're still setting plans for 2026. Those annual plans are based on our EBIT target is the success metric. So we'll give more color in March around 2026 SG&A and how we think that'll pan out by quarter with advertising and possibly a bit of more incentive comp in the mix. The more to come in March.

Speaker #1: We're still setting plans for 2026. There are annual plans, or based on our EBIT target, which is the success metric. So we'll probably give more color in March around 2026 SG&A and how we think that'll pan out by quarter.

Yeah, um, I did mention the brand awareness still is, you know, we have opportunity there, we're still only at 55% to 60. So as we gain, you know, and look to towards future. We have a lot of opportunity there. Um, you know, it's never about 1 thing. Um, certainly we double down on the product, the design team and Merchants team. It's really came together and thought about um our future strategies.

Speaker #1: With advertising and possibly a bit of more incentive compensation in the mix, there's more to come in.

Speaker #1: March. Great.

Operator: Great. Thanks. And then just a quick follow-up on Aerie. The momentum has been very, very strong. Curious what you think is specifically working there versus the competition when you either walk the mall or view kind of the competitive set, how you think about your market share gains and the opportunity there. Thanks so much.

Speaker #17: Thanks. And then just a quick follow-up on ARI. The momentum has been very, very strong. Curious what you think is specifically working there versus the competition when you either walk the mall or view kind of the competitive set. How do you think about your market share gains and the opportunity there?

Speaker #17: Thanks so much.

Speaker #15: Yeah, I did mention that brand awareness still is—we have opportunity there. We're still only at 55% to 60%. So as we gain and look towards the future, we have a lot of opportunity there.

Jen Foyle: Yeah. I did mention the brand awareness still is we have opportunity there. We're still only at 55% to 60%. So as we gain and look towards the future, we have a lot of opportunity there. It's never about one thing. Certainly, we doubled down on the product. The design team and merchant team really came together and thought about our future strategies and where we were seeing some losses and how we recalibrated all of our categories. And the team did an excellent job from launching new ideas to rebuilding old franchises, i.e., undies. Undies is a fire starter for any order, any basket. And our undies tables have never looked better. So it's all about the product. But strategically, we built into promotions that make sense, but we pulled back in other areas where it doesn't make sense.

Speaker #15: It's never about one thing. Certainly, we doubled down on the product. The design team and merchant team really came together and thought about our future strategies, where we were seeing some losses, and how we recalibrated all of our categories.

And where we were seeing some, um, you know, losses and how we recalibrated all of our um categories. Um, and the team did an excellent job from launching new ideas to, um, you know, rebuilding old franchises, IE undies. Um, undies is a fire starter for an, or for, you know, any order any basket and, um, R&D Stables have never looked better. Um, so it's all about the product, but strategically, we built into promotions that make sense, but we pulled back another areas where it doesn't make sense. Um, and then you layer on this great marketing campaign that we've had an area, which, um, it it's, it's been really resonating 100% real. Um, it's what we're all about and, um, you know, the teams doubled down and our influencer campaign, getting our clothes on our influencers, um, has been, um, a real win and, um, there's more to come. Um, we have so many great, um, new ideas, Innovations for the future, um, the teams

Speaker #15: And the team did an excellent job, from launching new ideas to rebuilding old franchises, i.e., undies. Undies is a fire starter for any order, any basket.

Speaker #15: And our undies tables have never looked better. So, it's all about the product. But strategically, we built in promotions that make sense, but we pulled back in other areas where it doesn't make sense.

100% locked and loaded on thinking about each category, a new Fabrications, new ideas, new launches, newness in general. Um, has been a win for our, um, with our new drops, um, and that's been really working. So, um, we have a lot in store for 2026, but in the meantime, we're pulling Goods in as for to pull out Q4, um, we're excited about what's happening right now.

Speaker #15: And then you layer on this great marketing campaign that we've had in ARI, which has really resonated—100% real. It's what we're all about.

Jen Foyle: And then you layer on this great marketing campaign that we've had in Aerie, which it's been really resonating, 100% real. It's what we're all about. And the teams doubled down. And our influencer campaign, getting our clothes on our influencers, has been a real win. And there's more to come. We have so many great new ideas, innovations for the future. The team's 100% locked and loaded on thinking about each category, new fabrications, new ideas, new launches. Newness in general has been a win for Aerie with our new drops, and that's been really working. So we have a lot in store for 2026, but in the meantime, we're pulling goods in to pull out Q4. We're excited about what's happening right now.

Speaker #15: And the team's doubled down. Our influencer campaign, getting our clothes on our influencers, has been a real win. And there's more to come.

Speaker #15: We have so many great new ideas and innovations for the future. The team's 100% locked and loaded on thinking about each category: new fabrications, new ideas, and new launches.

Speaker #15: Newness in general has been a win for ARI with our new drops, and that's been really working. So we have a lot in store for 2026, but in the meantime, we're pulling goods in to pull out Q4.

Speaker #15: We're excited about what's happening right

Speaker #15: now. The conference is

Operator: The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.

Q3 2025 American Eagle Outfitters Inc Earnings Call

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