EX-99.1 2 urbn-ex99_1.htm EX-99.1 EX-99.1

 

Exhibit 99.1

URBAN OUTFITTERS, INC.

First Quarter Results

Philadelphia, PA – May 21, 2025

For Immediate Release

Contact:

Oona McCullough

 

 

Executive Director of Investor Relations

 

 

(215) 454-4806

URBN Reports Record Q1 Sales and Income

PHILADELPHIA, PA, May 21, 2025 – Urban Outfitters, Inc. (NASDAQ:URBN), a leading lifestyle products and services company which operates a portfolio of global consumer brands including the Anthropologie, Free People, FP Movement, Urban Outfitters and Nuuly brands, today announced record net income of $108.3 million and earnings per diluted share of $1.16 for the three months ended April 30, 2025.

Total Company net sales for the three months ended April 30, 2025, increased 10.7% to a record $1.33 billion. Total Retail segment net sales increased 6.4%, with comparable Retail segment net sales increasing 4.8%. The increase in Retail segment comparable net sales was driven by mid single-digit positive growth in both retail store sales and digital channel sales. Comparable Retail segment net sales increased 6.9% at Anthropologie, 3.1% at Free People and 2.1% at Urban Outfitters. Subscription segment net sales increased by 59.5% primarily driven by a 52.9% increase in average active subscribers in the current quarter versus the prior year quarter. Wholesale segment net sales increased 24.2% driven by a 25.6% increase in Free People wholesale sales due to an increase in sales to specialty customers and department stores.

“We are excited to announce record first quarter revenues and profits,” said Richard A. Hayne, Chief Executive Officer. “Our success was driven by positive sales growth and improved profitability across all brands and segments. We believe these results demonstrate the strength of our brands and the effectiveness of our strategy, giving us confidence in URBN’s continued success,” finished Mr. Hayne.

Net sales by brand and segment for the three-month periods were as follows:

 

Three Months Ended

 

 

April 30,

 

 

2025

 

 

2024

 

Net sales by brand

 

 

 

 

 

Anthropologie

$

569,931

 

 

$

526,385

 

Free People

 

353,112

 

 

 

318,691

 

Urban Outfitters

 

273,505

 

 

 

270,258

 

Nuuly

 

124,354

 

 

 

77,942

 

Menus & Venues

 

8,599

 

 

 

7,456

 

Total Company

$

1,329,501

 

 

$

1,200,732

 

 

 

 

 

 

 

Net sales by segment

 

 

 

 

 

Retail Segment

$

1,130,510

 

 

$

1,062,685

 

Subscription Segment

 

124,354

 

 

 

77,942

 

Wholesale Segment

 

74,637

 

 

 

60,105

 

Total Company

$

1,329,501

 

 

$

1,200,732

 

 

 


 

For the three months ended April 30, 2025, the gross profit rate increased by 278 basis points compared to the three months ended April 30, 2024, and gross profit dollars increased 19.8% to $489.1 million from $408.4 million. The gross profit rate benefited from a non-recurring gain of $4.8 million, or 36 basis points, recorded in the current year quarter and store impairment and lease abandonment charges of $4.6 million, or 38 basis points, recorded in the prior year quarter not repeated in the current year quarter. The remaining 204 basis point increase in gross profit rate was primarily due to improved Retail segment markdowns driven by lower markdowns at Urban Outfitters, leverage in delivery expense due to lower carrier costs and a reduction in packages per order, and leverage in store occupancy costs due to the increase in comparable Retail segment net sales. The increase in gross profit dollars was due to higher net sales and the improved gross profit rate.

As of April 30, 2025, total inventory increased by $84.8 million, or 14.6%, compared to total inventory as of April 30, 2024. Total Retail segment inventory increased 13.2% and Retail segment comparable inventory increased 12.6%. Wholesale segment inventory increased 30.6%. The increase in inventory for both segments was due to increased sales and early receipts.

For the three months ended April 30, 2025, selling, general and administrative expenses increased by $27.1 million, or 8.1%, compared to the three months ended April 30, 2024. Selling, general and administrative expenses leveraged 65 basis points as a percentage of net sales compared to the three months ended April 30, 2024. The leverage in selling, general and administrative expenses as a rate to net sales was primarily related to lower litigation expenses in the current year quarter as compared to the prior year quarter. The dollar growth in selling, general and administrative expenses was primarily related to increased marketing expenses to support customer growth and increased sales in the Retail and Subscription segments, as well as increased store payroll expenses to support the Retail segment stores net sales growth.

The Company’s effective tax rate for the three months ended April 30, 2025, was 21.4%, compared to 23.6% in the three months ended April 30, 2024. The decrease in the effective tax rate for the three months ended April 30, 2025, was primarily attributable to the ratio of foreign taxable earnings to global taxable earnings.

Net income for the three months ended April 30, 2025, was a record $108.3 million and earnings per diluted share were $1.16.

On June 4, 2019, the Company’s Board of Directors authorized the repurchase of 20 million common shares under a share repurchase program. During the three months ended April 30, 2025, the Company repurchased and subsequently retired 3.3 million shares for approximately $152 million. During the twelve months ended January 31, 2025, the Company repurchased and subsequently retired 1.2 million shares for approximately $52 million. As of April 30, 2025, 14.7 million common shares were remaining under the program.

During the three months ended April 30, 2025, the Company opened a total of 13 new retail locations including: 9 Free People stores (including 5 FP Movement stores), 2 Anthropologie stores and 2 Urban Outfitters stores; and closed 2 Free People stores.

Urban Outfitters, Inc. offers lifestyle-oriented general merchandise and consumer products and services through a portfolio of global consumer brands comprised of 257 Urban Outfitters stores in the United States, Canada and Europe and websites; 241 Anthropologie stores in the United States, Canada and Europe, catalogs and websites; 237 Free People stores (including 68 FP Movement stores) in the United States, Canada and Europe, catalogs and websites, 9 Menus & Venues restaurants, 7 Urban Outfitters franchisee-owned stores and 2 Anthropologie franchisee-owned stores as of April 30, 2025. Free People, FP Movement and Urban Outfitters wholesale sell their products through department and specialty stores worldwide, digital businesses and the Company’s Retail segment. Nuuly is primarily a women’s apparel subscription rental service which offers a wide selection of rental product from the Company’s own brands, third-party brands and one-of-a-kind vintage pieces.

A conference call will be held today to discuss first quarter results and will be webcast at 5:00 pm. ET at: https://edge.media-server.com/mmc/p/ebyfjdxo/.

As used in this document, unless otherwise defined, "Anthropologie" refers to the Company’s Anthropologie and Terrain brands and "Free People" refers to the Company’s Free People and FP Movement brands.

This news release is being made pursuant to the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995. Certain matters contained in this release may contain forward-looking statements. When used in this release, the words “project,” “believe,” “plan,” “will,” “anticipate,” “expect” and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. Any one, or all, of the following factors could cause actual financial results to differ materially from those financial results mentioned

 


 

in the forward-looking statements: overall economic and market conditions (including current levels of inflation) and worldwide political events and the resultant impact on consumer spending patterns and our pricing power, the difficulty in predicting and responding to shifts in fashion trends, changes in the level of competitive pricing and promotional activity and other industry factors, the effects of the implementation of the United Kingdom's withdrawal from membership in the European Union (commonly referred to as “Brexit”), including currency fluctuations, economic conditions and legal or regulatory changes, any effects of war, including geopolitical instability, impacts of the conflict in the Middle East and impacts of the war between Russia and Ukraine and from related sanctions imposed by the United States, European Union, United Kingdom and others, terrorism and civil unrest, natural disasters, severe or unseasonable weather conditions (including as a result of climate change) or public health crises (such as the coronavirus (COVID-19)), labor shortages and increases in labor costs, raw material costs and transportation costs, availability of suitable retail space for expansion, timing of store openings, risks associated with international expansion, seasonal fluctuations in gross sales, response to new concepts, our ability to integrate acquisitions, risks associated with digital sales, our ability to maintain and expand our digital sales channels, any material disruptions or security breaches with respect to our technology systems, our effective utilization of technological advancements, including in artificial intelligence, the departure of one or more key senior executives, import risks (including any shortage of transportation capacities or delays at ports), changes to U.S. and foreign trade policies (including the enactment of tariffs such as retaliatory tariffs, border adjustment taxes or increases in duties or quotas, the unexpected closing or disruption of, or any damage to, any of our distribution centers, our ability to protect our intellectual property rights, failure of our manufacturers and third-party vendors to comply with our social compliance program, risks related to environmental, social and governance activities, changes in our effective income tax rate, changes in accounting standards and subjective assumptions, regulatory changes and legal matters and other risks identified in our filings with the Securities and Exchange Commission. The Company disclaims any intent or obligation to update forward-looking statements even if experience or future changes make it clear that actual results may differ materially from any projected results expressed or implied therein.

###

(Tables follow)

 


 

URBAN OUTFITTERS, INC.

Condensed Consolidated Statements of Income

(amounts in thousands, except share and per share data)

(unaudited)

 

 

Three Months Ended

 

 

April 30,

 

 

2025

 

 

2024

 

Net sales

$

1,329,501

 

 

$

1,200,732

 

Cost of sales (excluding store impairment and lease abandonment charges)

 

840,437

 

 

 

787,746

 

Store impairment and lease abandonment charges

 

 

 

 

4,601

 

          Gross profit

 

489,064

 

 

 

408,385

 

Selling, general and administrative expenses

 

360,837

 

 

 

333,761

 

          Income from operations

 

128,227

 

 

 

74,624

 

Other income, net

 

9,646

 

 

 

6,246

 

         Income before income taxes

 

137,873

 

 

 

80,870

 

Income tax expense

 

29,526

 

 

 

19,105

 

          Net income

$

108,347

 

 

$

61,765

 

 

 

 

 

 

 

Net income per common share:

 

 

 

 

 

       Basic

$

1.18

 

 

$

0.66

 

       Diluted

$

1.16

 

 

$

0.65

 

 

 

 

 

 

 

Weighted-average common shares outstanding:

 

 

 

 

 

       Basic

 

91,752,408

 

 

 

93,124,568

 

       Diluted

 

93,475,835

 

 

 

95,000,706

 

 

 

 

 

 

 

 

 

 

 

 

 

AS A PERCENTAGE OF NET SALES

 

 

 

 

 

Net sales

 

100.0

%

 

 

100.0

%

Cost of sales (excluding store impairment and lease abandonment charges)

 

63.2

%

 

 

65.6

%

Store impairment and lease abandonment charges

 

 

 

 

0.4

%

         Gross profit

 

36.8

%

 

 

34.0

%

Selling, general and administrative expenses

 

27.2

%

 

 

27.8

%

          Income from operations

 

9.6

%

 

 

6.2

%

Other income, net

 

0.8

%

 

 

0.5

%

         Income before income taxes

 

10.4

%

 

 

6.7

%

Income tax expense

 

2.3

%

 

 

1.6

%

          Net income

 

8.1

%

 

 

5.1

%

 

 


 

URBAN OUTFITTERS, INC.

Condensed Consolidated Balance Sheets

(amounts in thousands, except share data)

(unaudited)

 

 

April 30,

 

 

January 31,

 

 

April 30,

 

 

2025

 

 

2025

 

 

2024

 

ASSETS

 

 

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

 

 

    Cash and cash equivalents

$

189,433

 

 

$

290,481

 

 

$

173,995

 

    Marketable securities

 

285,585

 

 

 

319,949

 

 

 

312,558

 

    Accounts receivable, net of allowance for doubtful accounts
         of $1,964, $1,384 and $933, respectively

 

93,248

 

 

 

74,014

 

 

 

88,297

 

    Inventory

 

663,803

 

 

 

621,146

 

 

 

578,990

 

    Prepaid expenses and other current assets

 

206,990

 

 

 

187,206

 

 

 

219,886

 

            Total current assets

 

1,439,059

 

 

 

1,492,796

 

 

 

1,373,726

 

Property and equipment, net

 

1,346,557

 

 

 

1,331,077

 

 

 

1,304,548

 

Operating lease right-of-use assets

 

973,831

 

 

 

942,666

 

 

 

910,965

 

Marketable securities

 

365,937

 

 

 

410,208

 

 

 

287,178

 

Other assets

 

331,692

 

 

 

342,733

 

 

 

312,285

 

           Total Assets

$

4,457,076

 

 

$

4,519,480

 

 

$

4,188,702

 

 

 

 

 

 

 

 

 

 

LIABILITIES AND SHAREHOLDERS’ EQUITY

 

 

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

 

 

    Accounts payable

$

302,104

 

 

$

295,767

 

 

$

321,443

 

    Current portion of operating lease liabilities

 

231,361

 

 

 

227,149

 

 

 

224,100

 

    Accrued expenses, accrued compensation and other
         current liabilities

 

495,593

 

 

 

552,763

 

 

 

488,681

 

           Total current liabilities

 

1,029,058

 

 

 

1,075,679

 

 

 

1,034,224

 

Non-current portion of operating lease liabilities

 

909,168

 

 

 

871,209

 

 

 

849,917

 

Other non-current liabilities

 

87,043

 

 

 

101,088

 

 

 

142,227

 

           Total Liabilities

 

2,025,269

 

 

 

2,047,976

 

 

 

2,026,368

 

 

 

 

 

 

 

 

 

 

Shareholders’ equity:

 

 

 

 

 

 

 

 

    Preferred shares; $.0001 par value, 10,000,000 shares
         authorized, none issued

 

 

 

 

 

 

 

 

    Common shares; $.0001 par value, 200,000,000 shares authorized,
         89,614,734, 92,281,748 and 93,379,211 shares issued and
         outstanding, respectively

9

 

 

9

 

 

9

 

    Additional paid-in-capital

 

 

 

 

15,067

 

 

 

31,572

 

    Retained earnings

 

2,460,876

 

 

 

2,503,068

 

 

 

2,175,500

 

    Accumulated other comprehensive loss

 

(29,078

)

 

 

(46,640

)

 

 

(44,747

)

           Total Shareholders’ Equity

 

2,431,807

 

 

 

2,471,504

 

 

 

2,162,334

 

           Total Liabilities and Shareholders’ Equity

$

4,457,076

 

 

$

4,519,480

 

 

$

4,188,702

 

 

 


 

URBAN OUTFITTERS, INC.

Condensed Consolidated Statements of Cash Flows

(amounts in thousands)

(unaudited)

 

 

 

Three Months Ended

 

 

 

April 30,

 

 

 

2025

 

 

2024

 

Cash flows from operating activities:

 

 

 

 

 

 

Net income

 

$

108,347

 

 

$

61,765

 

Adjustments to reconcile net income to net cash provided by operating activities:

 

 

 

 

 

 

Depreciation and amortization

 

 

29,554

 

 

 

27,761

 

Non-cash lease expense

 

 

52,805

 

 

 

51,470

 

Provision for deferred income taxes

 

 

13,701

 

 

 

12,735

 

Share-based compensation expense

 

 

7,763

 

 

 

7,599

 

Amortization of tax credit investment

 

 

4,293

 

 

 

4,380

 

Store impairment and lease abandonment charges

 

 

 

 

 

4,601

 

Loss on disposition of property and equipment, net

 

 

94

 

 

 

135

 

Changes in assets and liabilities:

 

 

 

 

 

 

Receivables

 

 

(15,036

)

 

 

(21,512

)

Inventory

 

 

(37,386

)

 

 

(29,818

)

Prepaid expenses and other assets

 

 

(17,058

)

 

 

(37,542

)

Payables, accrued expenses and other liabilities

 

 

(54,114

)

 

 

36,663

 

Operating lease liabilities

 

 

(59,931

)

 

 

(59,686

)

Net cash provided by operating activities

 

 

33,032

 

 

 

58,551

 

Cash flows from investing activities:

 

 

 

 

 

 

Cash paid for property and equipment

 

 

(46,158

)

 

 

(41,091

)

Cash paid for marketable securities

 

 

(117,878

)

 

 

(95,799

)

Sales and maturities of marketable securities

 

 

203,416

 

 

 

91,081

 

Net cash provided by (used in) investing activities

 

 

39,380

 

 

 

(45,809

)

Cash flows from financing activities:

 

 

 

 

 

 

Proceeds from the exercise of stock options

 

 

 

 

 

475

 

Share repurchases related to share repurchase program

 

 

(151,935

)

 

 

 

Share repurchases related to taxes for share-based awards

 

 

(20,241

)

 

 

(14,445

)

Tax credit investment liability payments

 

 

(4,172

)

 

 

(1,341

)

Net cash used in financing activities

 

 

(176,348

)

 

 

(15,311

)

Effect of exchange rate changes on cash and cash equivalents

 

 

2,888

 

 

 

(1,757

)

Decrease in cash and cash equivalents

 

 

(101,048

)

 

 

(4,326

)

Cash and cash equivalents at beginning of period

 

 

290,481

 

 

 

178,321

 

Cash and cash equivalents at end of period

 

$

189,433

 

 

$

173,995