NEW YORK, Jan 12, 2026, 14:43 EST — Regular session
- Shares of Abercrombie & Fitch tumbled following the company’s downgrade of its full-year sales growth forecast
- Company revised its holiday-quarter outlook and highlighted tariff expenses baked into its guidance
- Investors are eyeing this week’s ICR Conference for new insights on demand and pricing
Shares of Abercrombie & Fitch Co dropped 17.3% to $103.26 in afternoon trading Monday, following a cut to its full-year sales growth forecast and a more cautious holiday-quarter outlook. The stock had climbed as high as $124.75 earlier before falling to a session low of $98.87.
The reset came as apparel and footwear companies rolled out early holiday-quarter updates, highlighting a tougher consumer environment ahead of the ICR Conference. Consumer Edge analyst Michael Gunther noted that “value-seeking behavior was on full display” in this morning’s wave of retail pre-announcements, with shoppers— even those with higher incomes—continuing to favor cheaper options. Abercrombie’s forecast for roughly 5% sales growth in the fourth quarter falls short of the 5.8% increase that analysts had predicted, according to LSEG data cited by Reuters. 1
For Abercrombie, it wasn’t the magnitude of the revision that mattered as much as the fact it moved downward. Investors had priced in steady growth and flawless execution; so even a minor cut can sting when expectations are so high.
Abercrombie now forecasts fiscal 2025 net sales growth of at least 6%, down slightly from its previous 6% to 7% range, with an operating margin near 13% and earnings between $10.30 and $10.40 per share. For Q4, the company expects sales growth around 5% and earnings in the $3.50 to $3.60 per share range. It raised planned capital spending to roughly $245 million, while maintaining share repurchase plans at about $450 million for the year, including $100 million this quarter. The outlook factors in approximately $90 million in tariff expenses—equivalent to 170 basis points, or 1.7 percentage points, of sales after mitigation—and a $39 million pretax gain from a litigation settlement. CEO Fran Horowitz described quarter-to-date net sales through fiscal December as “record.” 2
The margin line looks set to come under pressure next. Operating margin—which measures operating profit as a portion of sales—can shift rapidly when retailers ramp up promotions to drive traffic.
The risk here is clear. The company’s tariff calculations rely on trade policies from early January; any major changes in policy, enforcement, or new supply-chain issues could trigger yet another adjustment.
Investors will want to see how much of the profit forecast hinges on one-time items. The litigation settlement adds a lift to the full-year outlook, but it’s a one-off. Some portfolio managers will likely exclude it from their calculations.
Following that, the ICR Conference in Orlando runs through Jan. 14. Investors usually use this event to dig into retailers’ demand, pricing, and sourcing strategies. Fresh insights on tariffs or early January sales could nudge Abercrombie shares in one direction or another for the week ahead. 3
