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  • Nick Monjo

Aerie: Record Revenue, Operating Profit In Q4

A leggings promotion on the Aerie website.

Aerie reported “all-time high fourth quarter revenue and operating profit” in the fourth quarter. For the full year, however, while sales were up, operating profit was down at the lingerie division of American Eagle Outfitters.

In the 13 weeks ended January 28, Aerie operating income was $53.119 million on sales of $463.663 million, compared to operating income of $20.946 million on total net revenue of $428.418 million in the same quarter last year.

For the full year, Aerie reported operating income of $163.915 million on sales of $1.507 billion compared to operating income of $212.287 million on sales of $1.376 billion in the 52 weeks ended January 29, 2022.

The company pointed out that “compared to the pre-pandemic fiscal year 2019 base, Aerie revenue increased 88%.” And during the conference call to discuss the results, AEO CEO Jay Schottenstein gushed, “Aerie has demonstrated exciting multi-year growth, with fourth quarter revenue and adjusted operating income up over 70% in 2019. The rapid success of Offline, our expansion into active wear, underscores the strength of Aerie’s powerful brand platform. We have significant potential as we reach more-and-more customers and I cannot be more excited about the future.”

Jennifer Foyle, AEO president and executive creative director, AE & Aerie, added that “Aerie reached a milestone at $1.5 billion in revenue in 2022 as new stores continued to expand awareness. Since 2019, revenue has nearly doubled with operating profit up close to a 150%. I am pleased with this accomplishment, especially given the unprecedented macro volatility. For the fourth quarter Aerie continued to see good growth yet came in below our expectations. Core apparel showed up well and we achieved our best sweater season in the brand’s history while also continuing positive growth in fleece.” She said that Offline “remained a standout performer, led by our leggings franchise. Leggings continue to be a powerful driver of new customer acquisition and we are seeing nice momentum across fashion and performance, style. Intimate was a bit softer-than expected. And as we look-forward to 2023, our plans include launching more newness in intimates to build greater awareness and engagement.”

Foyle concluded, “it feels like Aerie in early days, we are growing at a very rapid rate. We are learning about the business. We have some different store formats, so that we can really learn to leverage.”

CFO Mike Mathias revealed, apparently referring to 2023, that the company plans “to open approximately 25 new Aerie stores next year with net closures at AE of approximately 25 stores.”

EVP and chief operations officer Michael Rempell was optimistic about Aerie’s continued growth, pointing out that “we opened over 130 Aerie stores in the last two years. Those stores as they mature they’re going to start comping, they’re going to start a multi year trajectory of comps, which is what all our data and all history tells us. And they’re going to bring new customers into the brand and grow, not just the store comp, but also the digital comp.”

As of January 28 the company was operating 295 Aerie and Offline stand alone locations. The company was also operating 875 American Eagle and Todd Snyder stores, all of which sell a variety of apparel, and some of which also contain Aerie or Offline “side by side” locations. — NM


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