American Eagle Signals Weak Revenue Growth in Holiday Quarter

American Eagle Outfitters Inc on Tuesday signalled its revenue growth in the holiday quarter was hampered by supply chain snarls and disruptions caused by the Omicron surge, sending its shares down 2 percent in premarket trading.

The company forecast fourth quarter revenue to rise in the mid-to-high teens percentage, lower than market estimates of 21.5 percent growth, according to Refinitiv data.

The weak outlook underscored the impact of a renewed surge in US Covid-19 cases, which forced worsened staffing and inventory shortages at several retailers and forced some to cut operating hours during the busiest shopping period of the year.

Urban Outfitters Inc said earlier in the day traffic at its stores reduced in November and December, while yoga-wear maker Lululemon Athletica Inc had warned of a hit to sales from the Omicron coronavirus variant on Monday.

American Eagle rival Abercrombie & Fitch Co has also given a disappointing sales forecast because of supply chain hurdles.

But Abercrombie said it sales have started rising in the post-holiday period, while American Eagle raised its long-term revenue target to $5.8 billion from $5.5 billion.

By Praveen Paramasivam and Deborah Sophia; Editors: Krishna Chandra Eluri and Aditya Soni

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