New York, Jan 12, 2026, 16:09 EST — After-hours
Urban Outfitters (URBN.O) shares dropped roughly 12% Monday following a 9% increase in holiday sales—proof that even solid results can disappoint when expectations are steep. The stock hit an intraday low of $70.27 before recovering slightly to $71.49.
The holiday update matters because it offers investors an early glimpse at demand and pricing during the crucial selling period, ahead of the company’s quarterly profit report. It comes as traders weigh whether shoppers are trading down—and how that might squeeze margins at mall brands.
The selloff extended across apparel and footwear stocks after Abercrombie & Fitch lowered its annual sales forecast and Birkenstock predicted quarterly revenue would miss expectations. American Eagle maintained its fourth-quarter outlook, yet Urban Outfitters also slid alongside the group. “The theme of value-seeking behavior was on full display,” said Consumer Edge analyst Michael Gunther, referencing retailer updates ahead of the ICR conference. 1
Urban Outfitters reported a 9% jump in total net sales for the two months ending Dec. 31 compared to last year. Retail segment sales were up 7%, with comparable retail sales — those from stores and online channels open at least a year — rising 5%, fueled by mid-single-digit growth both online and in stores. Comparable retail sales climbed 9% at Urban Outfitters, 5% at Free People, and 3% at Anthropologie, while FP Movement surged 18%. The subscription segment, including the Nuuly apparel rental service, saw a 43% increase in sales. Wholesale sales ticked up 13%. 2
Investors seemed to be focusing less on the headline and more on what lies ahead: the extent of growth needing promotions and if demand stayed strong into January. Holiday sales reports often shift expectations sharply, shaping views on inventory and markdowns for the quarter.
Nuuly once again led in subscriber-driven growth, but traders remain focused on the bigger names — Urban Outfitters, Anthropologie, and Free People — wondering if foot traffic held steady after the holiday surge.
The company reported opening 58 new retail locations while shutting down seven over the eleven months ending Dec. 31. This expansion boosts leverage if demand holds firm but increases risk if sales falter.
The risk is clear-cut. If consumers continue hunting for deals, retailers may sustain sales but at the expense of profit margins. Increased discounting or new cost pressures from trade policies and shipping disruptions would cloud the outlook, even if sales still climb.
U.S. markets are closed today, putting the spotlight on Tuesday’s consumer and retail reports. Investors will also watch for any fresh pre-announcements or cautious remarks linked to the ICR conference in Orlando, which continues through Jan. 14. 3
