American Eagle Outfitters (NYSE: AEO) reported Q4 EPS of $0.35, in-line with the analyst estimate of $0.35. Revenue for the quarter came in at $1.51 billion versus the consensus estimate of $1.52 billion.

Outlook:

We are extremely confident in the strength of our brands and pleased with early performance of spring collections. Based on a number of macro uncertainties, however, we are taking a cautious view of 2022. For the year, we expect operating profit to be in the range of $550 to $600 million, compared to adjusted operating profit of $603 million in 2021. Our 2022 guidance reflects structural improvements to our business and significant growth from pre pandemic 2019, which posted adjusted operating profit of $314 million.

Due largely to stimulus in the first half of 2021, which contributed to an extraordinary Spring season, combined with continued freight pressures, we are forecasting an earnings decline in the first half, followed by a recovery in the second half as we lap elevated air freight due to factory closures and inventory flow challenges last year.

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