Gap, Abercrombie and (Sort of) Nike: Earnings to Watch This Week



Some of the biggest mass fashion retailers report their fourth-quarter results this week (most luxury brands took their turn around the start of the month). We already know that holiday sales were stronger-than-expected at high-flying retailers like Abercrombie & Fitch and American Eagle; less so at struggling competitors. And after last week’s big shakeup at Macy’s, could other retailers be looking to make some major changes too?

Abercrombie & Fitch: How Long Can They Keep This Up?

Seriously, how are they doing it? The company, which was lumped in with Gap and other struggling mall brands not all that long ago, is on fire. In what was expected to be a weak holiday season for most retailers, sales grew in the mid-teens. The secret to Abercrombie’s success is basically just retail 101: figure out what your customers want, and sell it in just the right amount. The company’s stock, the best performing of any large US company last year, has continued to rise in 2024. Nothing lasts forever, but there aren’t any signs the party is winding down yet.

Speaking of brands that keep moving from high to high: Fellow mall rat American Eagle, which also had a blowout holiday season, reports Thursday. If your taste in red-hot brands run more luxe, Prada reports Thursday (and Miu Miu shows in Paris on Tuesday).

Foot Locker: But Also, Nike

The footwear seller has historically served as a de facto Nike showroom, with the sneaker brand representing about two-thirds of annual sales (and that’s actually down from recent years). Nike was mentioned 21 times in Foot Locker’s last earnings call (it’s a bit of a one-sided relationship; the retailer didn’t come up once when Nike executives last spoke to analysts). The symbiotic arrangement can make Foot Locker a good indicator for where Nike is headed; which shoes it sends to third-party retailers, and in what quantities, says a lot about thinking in Beaverton. This go-round is especially relevant, given Nike’s recent troubles, and the rapidly shifting landscape in the basketball category, a Foot Locker specialty.

Gap: Turning Around or in Traction?

We are starting to catch glimpses of what the Richard Dickson era at Gap will look like. Zac Posen’s appointment as creative director raised eyebrows (whether in excitement or confusion, you decide). Last week saw the debut of a new ad starring Tyla, a Grammy Award-winning, TikTok-viral South African musician who has never fronted a major fashion campaign that evokes that khaki commercial. A nostalgia-flecked brand remix certainly worked for Barbie, but comebacks in fashion are harder than in children’s toys. Then again, a Gap campaign that isn’t ignored or ruthlessly mocked counts as a victory these days, right?

Speaking of turnarounds, Victoria’s Secret reports results on Wednesday. The lingerie giant is something of a cautionary tale for Gap; the brand is edging away from its 2022 makeover, which failed to resonate with consumers.

Nordstrom: What Is the Future for Department Stores?

Last week, Macy’s new CEO announced that the chain would close 150 department stores and invest more in its luxury-focused Bloomingdale’s locations, a drastic move aimed at ensuring the company could survive an assault from activist investors, as well as the wider retail apocalypse. Nordstrom’s product mix is closer to Bloomingdale’s than Macy’s, but it faces many of the same problems, including declining foot traffic in some malls and shrinking margins in the always tough wholesale business. The company has dabbled in fixes ranging from small-format stores to closing unprofitable businesses (RIP Nordstrom Canada), and the closure of Macy’s stores may send some customers to rival department stores. But if things don’t turn around soon, the company may need to contemplate some drastic moves of its own, or risk becoming another activist investor target.

What Else to Watch for This Week

Sunday

Paris Fashion Week: Balenciaga, Valentino, Mugler

Monday

Paris Fashion Week: Stella McCartney, Zimmermann, Marine Serre, Sacai, Pierre Cardin, Coperni

Stitch Fix, Thredup report results

Tuesday

Paris Fashion Week: Chanel, Kiko Kostadinov, Miu Miu, Lacoste, Louis Vuitton

Oddity Tech, Ross Stores, Nordstrom report results

Wednesday

Foot Locker, Abercrombie & Fitch, Victoria’s Secret, The Honest Company report results

Thursday

Hugo Boss, Burlington, Prada, American Eagle, Gap report results

The Week Ahead wants to hear from you! Send tips, suggestions, complaints and compliments to brian.baskin@businessoffashion.com.



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