1 00:00:00,040 --> 00:00:04,040 Speaker 1: Several retail companies reporting earnings, including Abercrombie and Fitch this morning, 2 00:00:04,400 --> 00:00:07,200 Speaker 1: raising its twenty twenty four outlooked after its third quarter 3 00:00:07,280 --> 00:00:09,800 Speaker 1: estimates and top estimates. As just say, the brands come 4 00:00:09,800 --> 00:00:12,920 Speaker 1: back continues to resonate with teens and young millennials, and 5 00:00:12,960 --> 00:00:15,360 Speaker 1: the stock up more than two hundred percent this year, 6 00:00:15,640 --> 00:00:18,680 Speaker 1: investors have high expectations going forward. Please to say that 7 00:00:18,720 --> 00:00:21,640 Speaker 1: the CEO of Abercrombie and Fitch is joining us right now, 8 00:00:22,079 --> 00:00:26,119 Speaker 1: Frand Horowitz. Fran, let's just talk about and you know, 9 00:00:26,200 --> 00:00:27,760 Speaker 1: forgive me if this is the wrong phrase, but this 10 00:00:27,840 --> 00:00:29,880 Speaker 1: has to be a bit of a comeback story here. 11 00:00:30,000 --> 00:00:31,640 Speaker 1: There are a lot of people that wrote this company 12 00:00:31,640 --> 00:00:33,840 Speaker 1: off a few years ago. They said time had passed 13 00:00:33,880 --> 00:00:36,720 Speaker 1: it by. But you, for one reason or another, have 14 00:00:36,840 --> 00:00:38,959 Speaker 1: managed to quote a tap in a whole new generation 15 00:00:39,400 --> 00:00:42,239 Speaker 1: of younger people who have now found this brand, and 16 00:00:42,280 --> 00:00:44,520 Speaker 1: at least based on the results from the last three 17 00:00:44,600 --> 00:00:47,560 Speaker 1: or four quarters, appear to be really propelling sales forward. 18 00:00:48,760 --> 00:00:51,320 Speaker 2: Yes, hey, Romaine, thanks so much for having me today. Yeah, so, 19 00:00:51,400 --> 00:00:53,040 Speaker 2: just to give a little bit of history. You know, 20 00:00:53,240 --> 00:00:55,200 Speaker 2: I've joined the company about nine years ago and we 21 00:00:55,280 --> 00:00:57,480 Speaker 2: have been on an incredible journey of building both the 22 00:00:57,480 --> 00:01:01,320 Speaker 2: Abercrombie and the Hollister brands. The aber Comby brand turnaround 23 00:01:01,880 --> 00:01:04,440 Speaker 2: started quite some time ago. We're in our eleventh consecutive 24 00:01:04,520 --> 00:01:09,039 Speaker 2: quarter of positive comps, which is super exciting, and we 25 00:01:09,120 --> 00:01:11,880 Speaker 2: have really done something very special in the retail industry. 26 00:01:11,920 --> 00:01:14,480 Speaker 2: We've taken the brands and we've figured out their rightful 27 00:01:14,480 --> 00:01:17,120 Speaker 2: place in the world. So we put Hollister as the 28 00:01:17,120 --> 00:01:20,399 Speaker 2: global teen brand and we aged Abercrombie up. You used 29 00:01:20,400 --> 00:01:23,880 Speaker 2: to be a brand for teens, for jeans and T shirts, 30 00:01:24,160 --> 00:01:28,280 Speaker 2: and now it's truly a young millennial brand for that customer, 31 00:01:29,040 --> 00:01:32,560 Speaker 2: a lifestyle brand, say twenty five to thirty, but we've 32 00:01:32,600 --> 00:01:35,880 Speaker 2: expanded our categories and our age range from twenty to 33 00:01:36,080 --> 00:01:37,200 Speaker 2: forty and beyond. 34 00:01:38,040 --> 00:01:40,520 Speaker 1: When we talk about the sales growth and where it 35 00:01:40,600 --> 00:01:43,720 Speaker 1: came from here, is the sense here is that there 36 00:01:43,800 --> 00:01:47,240 Speaker 1: is greater demand for the clothes or is this just 37 00:01:47,360 --> 00:01:49,840 Speaker 1: simply kind of a shifting in the spending from one 38 00:01:50,560 --> 00:01:51,880 Speaker 1: subset of consumers to another. 39 00:01:53,360 --> 00:01:56,000 Speaker 2: No, the brand is growing very significantly. I mean the 40 00:01:56,000 --> 00:01:58,800 Speaker 2: turn started with Women's. Women's has actually seen their thirteenth 41 00:01:58,840 --> 00:02:01,880 Speaker 2: consecutive quarter of growth BO So this is definitely an 42 00:02:01,880 --> 00:02:04,160 Speaker 2: opportunity for us to take share. I mean, as you know, 43 00:02:04,200 --> 00:02:06,360 Speaker 2: in the apparel space, it's a game of taking share, 44 00:02:06,720 --> 00:02:09,440 Speaker 2: and that's exactly what we're Exactly what we're doing. The 45 00:02:09,520 --> 00:02:12,840 Speaker 2: expansion of our categories out again of jeans and T 46 00:02:12,960 --> 00:02:16,800 Speaker 2: shirts and into things like dresses. Our curve love genes 47 00:02:16,800 --> 00:02:19,840 Speaker 2: have been terrific. Our new YPB, which is our active brand, 48 00:02:19,880 --> 00:02:24,320 Speaker 2: is also tracking very nicely. So definitely taking share and Farann, 49 00:02:24,360 --> 00:02:24,959 Speaker 2: I want to talk. 50 00:02:24,800 --> 00:02:27,360 Speaker 3: A little bit more about the aging up of Abercromby 51 00:02:27,440 --> 00:02:29,640 Speaker 3: because I have to admit I wasn't cool enough to 52 00:02:29,680 --> 00:02:32,480 Speaker 3: shop at Abercrombie. I was at hot topic just a 53 00:02:32,480 --> 00:02:35,880 Speaker 3: few stores down. But one of my peers shopped at 54 00:02:35,919 --> 00:02:38,280 Speaker 3: Abercrombie when we were teenagers, and I feel like it's 55 00:02:38,280 --> 00:02:41,320 Speaker 3: still thought of as a teenage brand. How do you 56 00:02:41,440 --> 00:02:44,880 Speaker 3: age up and sort of attract that up to forty category? 57 00:02:46,080 --> 00:02:48,960 Speaker 2: Well, OK, it's interesting. It's been an amazing journey, but 58 00:02:49,040 --> 00:02:51,120 Speaker 2: what we have learned is that the customer is the 59 00:02:51,120 --> 00:02:53,640 Speaker 2: one who's actually behind us and supporting us. We do 60 00:02:53,760 --> 00:02:56,760 Speaker 2: a lot of customer research. We say very close to 61 00:02:56,800 --> 00:02:59,560 Speaker 2: our customer. When we initially went on this journey, we 62 00:02:59,639 --> 00:03:01,840 Speaker 2: realize is that there's a big white space out there 63 00:03:01,880 --> 00:03:04,880 Speaker 2: for that young millennial customer. We studied very hard to 64 00:03:04,960 --> 00:03:08,720 Speaker 2: understand what he and she are looking for and decided 65 00:03:08,760 --> 00:03:11,320 Speaker 2: that the ninety six hour weekend when they are away 66 00:03:11,360 --> 00:03:14,040 Speaker 2: with their friends, whether that's at weddings or bachelorette parties 67 00:03:14,120 --> 00:03:17,000 Speaker 2: or just weekends away or even staycations, that we could 68 00:03:17,000 --> 00:03:20,720 Speaker 2: clothe them for that entire ninety six hour vacation. On 69 00:03:20,760 --> 00:03:22,840 Speaker 2: top of that, we then realized as they started to 70 00:03:22,840 --> 00:03:25,200 Speaker 2: go back to the office and needed clothing for that too, 71 00:03:25,520 --> 00:03:27,560 Speaker 2: that we could provide that as well. So really a 72 00:03:27,560 --> 00:03:30,680 Speaker 2: lifestyle brand supporting them for all their different wearing occasions. 73 00:03:31,120 --> 00:03:34,920 Speaker 3: And as part of that lifestyle component, how much opportunity 74 00:03:34,920 --> 00:03:38,000 Speaker 3: do you see in perhaps work wear, for example, especially 75 00:03:38,000 --> 00:03:39,560 Speaker 3: as you target that young millennial. 76 00:03:40,760 --> 00:03:43,800 Speaker 2: So great question, because we have a franchise called the 77 00:03:43,840 --> 00:03:47,000 Speaker 2: Sloan and that is a trouser pant for women that 78 00:03:47,120 --> 00:03:50,120 Speaker 2: is absolutely on fire and terrific. We've started delivering it 79 00:03:50,560 --> 00:03:53,080 Speaker 2: about a year ago, and that's exactly what she does 80 00:03:53,120 --> 00:03:54,880 Speaker 2: with it. She wears it to the office, maybe with 81 00:03:54,920 --> 00:03:56,880 Speaker 2: a jacket and the top, she takes a jacket off 82 00:03:56,920 --> 00:03:58,400 Speaker 2: and she goes out to the bar with their friends 83 00:03:58,440 --> 00:04:01,080 Speaker 2: or out to dinner, So it's got a multipurpose to it, 84 00:04:01,160 --> 00:04:03,720 Speaker 2: and she's really feeling very special in it. 85 00:04:04,520 --> 00:04:07,480 Speaker 1: I am curious about your expectations for the holiday season. 86 00:04:07,800 --> 00:04:10,880 Speaker 1: I mean, how much how dependent is Abercrombie and Fitch 87 00:04:10,920 --> 00:04:13,560 Speaker 1: and its brands on this particular time of the year, 88 00:04:13,640 --> 00:04:15,680 Speaker 1: or do you have a little bit more I guess 89 00:04:15,680 --> 00:04:17,960 Speaker 1: of an even dispersion across the full year. 90 00:04:19,000 --> 00:04:21,640 Speaker 2: Yeah, so as z Abercrombie has evolved into this older customer, 91 00:04:21,760 --> 00:04:24,560 Speaker 2: the businesses to your point, a little bit more. Even 92 00:04:24,800 --> 00:04:27,680 Speaker 2: Hollister is also a little bit more dependent on this 93 00:04:27,720 --> 00:04:30,080 Speaker 2: time of the year. But Black Friday is an important 94 00:04:30,160 --> 00:04:33,960 Speaker 2: holiday for both brands, truthfully, and the fourth quarter is 95 00:04:33,960 --> 00:04:34,719 Speaker 2: our biggest. 96 00:04:34,480 --> 00:04:35,279 Speaker 1: Quarter of the year. 97 00:04:35,800 --> 00:04:38,400 Speaker 2: So we're excited. We are ready to compete. Our inventories 98 00:04:38,440 --> 00:04:39,520 Speaker 2: are in great shape. 99 00:04:39,680 --> 00:04:39,840 Speaker 3: You know. 100 00:04:39,839 --> 00:04:43,040 Speaker 2: We've been running this business on a real lean inventory 101 00:04:43,080 --> 00:04:46,200 Speaker 2: and testing and learning into known winners, and we're ready 102 00:04:46,240 --> 00:04:47,239 Speaker 2: to go for the fourth quarter. 103 00:04:47,720 --> 00:04:49,560 Speaker 3: All right, that's a good place to leave it. Friand 104 00:04:49,640 --> 00:04:52,680 Speaker 3: really enjoyed this conversation. Our thanks to friend Horowitch. She 105 00:04:52,839 --> 00:04:54,920 Speaker 3: is the CEO of Abercrombie and Fitch.