Retailers revealed early holiday performance metrics on Monday, providing insights into a crucial shopping season characterized by solid but not extraordinary results. Lululemon, currently navigating a leadership transition and a proxy battle with its founder, announced anticipated revenues for its holiday quarter to be “toward the high end” of earlier guidance, estimating close to $3.60 billion alongside earnings of approximately $4.76 per share. This projection aligns with the high end of the range provided in December during the release of fiscal third-quarter earnings. The company maintained its previous guidance concerning gross margin, effective tax rate, and administrative expenses, and its shares experienced a slight uptick of about 1% in morning trading.
Finance chief Meghan Frank emphasized a commitment to executing improvement strategies in the U.S. market while expressing optimism about prospective opportunities. Outgoing CEO Calvin McDonald highlighted the influence of significant discounting on demand during the Thanksgiving holiday, acknowledging a slowdown in trends once the shopping period concluded. Historically, Lululemon has been conservative with discounts; however, recent months have seen the brand increase markdowns to clear out outdated merchandise.
In contrast, Abercrombie & Fitch faced a troubling situation as its shares plummeted over 18% after a guidance revision. Despite reporting “record” sales for the quarter to date, the retailer now expects full-year sales to increase by “at least 6%,” a decrease from the previous projection of 6% to 7%. Their anticipated operating margin has been adjusted to approximately 13%, down from an earlier 13% to 13.5%. CEO Fran Horowitz confirmed that balanced growth across various regions and brand channels was achieved, even amidst the lowered expectations.
Birkenstock shared preliminary insights, expecting sales to increase by 11% for the quarter ending December 31, estimating figures around €402 million ($470 million). The company’s shares climbed about 2% in early trading following this announcement.
Savers Value Village reported an 8.4% increase in sales during its holiday quarter, with comparable sales growing 5.4%, although it opted to keep its fiscal 2025 profit and EBITDA forecasts intact. The retailer’s shares saw slight gains.
On a positive note, American Eagle outperformed expectations, reporting high single-digit growth in quarter-to-date comparable sales through January 3. The retailer announced a revision of its expected fourth-quarter operating income to between $167 million and $170 million, up from a previous $155 million to $160 million prediction. CEO Jay Schottenstein noted the record sales in December and growing momentum from new product offerings and successful marketing initiatives, despite a 9% decline in stock value on the same day.
Five Below reported impressive quarter-to-date sales growth of 23.2% and a 14.5% increase in comparable sales. The company updated its fiscal fourth-quarter sales expectations to around $1.71 billion, a substantial rise from an earlier range of $1.58 billion to $1.61 billion. With adjusted earnings per share guidance raised to between $3.95 and $4, the retailer’s shares dipped about 1% in early trading.
The early holiday performance reveals a mixed retail landscape ahead of the annual ICR conference in Orlando, Florida. Analysts have anticipated the holiday shopping season would yield strong individual performers; however, broader market trends suggest only modest gains in consumer spending overall. The National Retail Federation had previously predicted a retail sales growth of 3.7% to 4.2% for November and December, considering inflationary pressures from tariffs.
