Abercrombie's comeback
Style reborn at the mall food court
Good morning, hoodie heros. This is your Stock Market Rundown for June 6th, 2024. Thanks for taking the ride, once again. Let’s dig in:
TODAY’S TOP STORY: TRENDY TRANSFORMATION
Breaking news: it’s time to dig out those chino shorts and rugby shirts that got relegated to the bottom drawer ten years ago. Yes, Abercrombie & Fitch is actually cool again.
After peaking in the early 2000s, the retailer struggled for years as shoppers fled the mall. But the numbers tell the story: the brand just surpassed a billion dollars in quarterly revenue for the first time.
Abercrombie & Fitch has had a few style pivots in its history. It started out in 1892 as an outfitter for outdoorsmen, specializing in shotguns, fishing rods and tents.
By the 90s, Abercrombie had left the hunting party behind. The brand was reinvigorated by flamboyant CEO Mike Jeffries. He crafted the marketing that forever linked Abercrombie with the aspirational figure of the cool, popular college bro.
To make sure Abercrombie’s stores had plenty of sex appeal, Jeffries pushed a policy of only hiring good-looking people as employees. Not exactly “inclusive”.
Times have definitely changed. The current CEO, Fran Horowitz, is putting less emphasis on sex and more on getting the assortment and sizing right. Another plus: Abercrombie stores are no longer dimly-lit and reeking of cologne.
So what’s been flying off the shelves? Earlier this year, Abercrombie launched a wedding shop, with garments for brides priced under $150—way cheaper than standard wedding-dress prices. Horowitz reported on the earnings call that the wedding line has “exceeded our expectations.”
As for the guys? Think “relaxed fit.” Horowitz said male customers are opting for baggier jeans and looser tops. Sounds like the wardrobe for a comfy summer.
SO WHAT ELSE IS GOING ON?
I previously told you about Hertz’s financial struggles. Now, the car rental company is looking to raise financing to help it get back on track. Maybe they should get into the scooter rental business… at least a scooter doesn’t get its windows smashed if you leave it parked in the wrong neighborhood.
Costco beat estimates thanks to rebounding demand for cheap discretionary purchases. Insert obligatory $1.50 hot dog joke here.
T-Mobile must really hate dropped calls. The telecom is spending $4.4 billion to acquire U.S. cellular’s wireless operations, which T-Mobile says will give its customers better coverage.
Best Buy’s stock jumped after a better-than-expected quarterly report, thanks to customers buying higher-end TVs. Maybe guys are getting better at convincing their wives that an 85-inch flatscreen will really tie the living room together.
That’s it for today, my friends; see you bright and early tomorrow morning. Yours in capitalism, The Axe
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