• by Sarah Mahoney  @mahoney_sarah, September 5, 2019

American Eagle Outfitters has defied the retail odds yet again, posting its 18th consecutive quarter of sales growth. It says it is expecting sales to rise again next quarter, with a percentage gain in the mid- to single digits.

Those results are in sharp contrast to brands like Abercrombie & Fitch, which last week missed its financial targets, and cut its estimates for the full year. And Forever 21 is gasping for air, reportedly mulling a bankruptcy filing.

At American Eagle, revenue increased 8% to a record $1.04 billion, compared to $965 million in the comparable period of the prior year, a gain that included $40 million for Japan license royalties. Consolidated comparable sales gained 2%, following a 1% dip at the American Eagle brand, and a 16% jump at Aerie. As that brand continues its expansion into activewear, built on body positivity and a ban on airbrushing and photo retouching, it marks its 19th consecutive quarter of double-digit growth.

But it wasn’t all easy street for the Pittsburgh-based AEO. Operating results fell below its expectations, “stemming from underperformance in certain seasonal categories and a delayed start to back-to-school.”

But it says it continues strong momentum in AE Jeans, Aerie and its digital channel.

While noting that its collections this season were a little too “samey,” Neil Saunders, managing director of GlobalData Retail, remains positive about AEO’s ability to wow its young customers.

“Like other retailers, it saw less interest from consumers, which translated into weak numbers,” he writes in his analysis of the earnings report. But he says the strengthening of sales as the quarter progressed bodes well for the third quarter, especially with its stepped-up offering of jeans for both women and men.

And Aerie continues to shine, especially as Victoria’s Secret struggles worsen. “Aerie is still taking market share across all the categories in which it trades,” he says. “This includes from Victoria's Secret, thanks to Aerie's inclusive marketing and proposition, which continue to resonate. We have noticed the brand being much more active on social media, which we see as helpful in widening Aerie’s potential audience.”