Abercrombie & Fitch Co. plunged as much as 14 percent in early trading after first-quarter sales trailed analysts’ estimates, hurt by dwindling traffic abroad and reduced tourist spending in the U.S.
Sales fell 3.4 percent to $685.5 million in the quarter through April 30, the company said Thursday in a statement. Analysts projected $710 million, on average. The loss for the quarter was 59 cents a share. Analysts estimated 51 cents.
Executive Chairman Arthur Martinez said Abercrombie faced “significant traffic headwinds,” particularly in international markets and at U.S. stores dependent on visits by tourists. Abercrombie’s international comparable-store sales fell 7 percent, while analysts had estimated revenue on that basis would gain 0.2 percent, according to Consensus Metrix. U.S. same-store sales slipped 2 percent. Analysts’ projected they’d be unchanged.
The second quarter will remain “challenging,” and results will improve in the last half of the year, helped by better clothing assortments and investments in marketing, management and online operations, Martinez said in the statement.
The shares slid as low as $21.50 before the start of regular trading in New York. The New Albany, Ohio-based company already had retreated 7.1 percent this year through Wednesday.