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The Ohio-based apparel retailer said it now expects net sales to be rise between 1% and 2% in the fourth quarter, compared with its prior forecast of a 2% to 4% fall.
The company has been revamping its inventories to get rid of casual wear and athleisure clothing, which are now seeing softer demand compared to the pandemic peak, and has also brought in new styles that have attracted wealthier shoppers.
Abercrombie noted an improvement in overall sales trends from the third quarter, but said sales at its Hollister brand were still expected to remain below 2021 levels in the holiday quarter.
The company projected fourth-quarter operating margin between 6% and 8%, up from a range of 5% to 7% estimated previously.
Meanwhile, yoga wear maker Lululemon Athletica (NASDAQ:LULU) Inc lowered its expectations for fourth-quarter gross margins, sending its shares down more than 12% before the bell.
