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    URBN
    Earnings call· Jan 2026(Q4 FY26)

    URBAN OUTFITTERS Q4 FY26 earnings call URBN

    Feb 25, 2026 Source

    Executive summary

    Urban Outfitters, Inc. Q4 FY26 — Record Sales and Profitability Across Brands

    Urban Outfitters closed FY26 with record Q4 sales and operating profit, driven by strong performance across all retail brands and significant growth from Newly. The company is investing in technology and logistics for FY27, anticipating continued high single-digit sales growth despite near-term tariff and SG&A pressures. Management remains optimistic about market share capture and customer engagement.

    Highlights

    5

    • Total revenue grew by 10% in Q4, reaching a record $1.8 billion.

    • Adjusted EPS jumped 38% for Q4 and 35% for the full year.

    • Gross profit dollars increased 14% to nearly $600 million, with the rate improving by 101 basis points to 33.3%.

    • Total URBN operating income rose 27% to a Q4 record of $159 million, with the operating profit rate growing by 115 basis points.

    • Newly delivered 43% revenue growth, surpassed $500 million in annual revenue, and increased total profitability by over $21 million.

    Concerns

    4

    • Tariffs negatively impacted Q4 gross and operating profit rate by approximately 75 basis points and the full year by approximately 35 basis points.

    • Q1 FY27 gross profit margins are expected to be down approximately 25 to 50 basis points year-over-year, primarily due to lower IMU from increased tariffs.

    • Total SG&A growth is expected to outpace sales growth for both Q1 and full-year FY27 due to strategic technology and marketing investments.

    • Extreme weather events in February negatively impacted Q1 FY27 store sales, causing Anthropologie to run slightly behind its low single-digit comp plan.

    Guidance & targets

    36
    CategoryTargetConfidence
    Full-year FY27 Total Company Sales Growth
    positive high single-digit
    high materiality
    High
    Full-year FY27 Retail Segment Comp
    mid-single-digit
    high materiality
    High
    Full-year FY27 Newly Revenue Growth
    mid-double-digit
    high materiality
    High
    Full-year FY27 Wholesale Segment Growth
    mid-single-digit
    medium materiality
    High
    Q1 FY27 Total Company Sales Growth
    positive high single-digit
    high materiality
    High
    Q1 FY27 Retail Segment Comp
    mid-single-digit
    high materiality
    High
    Q1 FY27 Urban Outfitters Retail Segment Comp
    high single-digit positive
    medium materiality
    High
    Q1 FY27 Free People Retail Segment Comp
    mid-single-digit positive
    medium materiality
    High
    Q1 FY27 Anthropologie Retail Segment Comp
    low single-digit positive
    medium materiality
    High
    Q1 FY27 Newly Revenue Growth
    mid-double-digit
    high materiality
    High
    Q1 FY27 Wholesale Segment Revenue Growth
    mid-teen
    medium materiality
    High
    Full-year FY27 Gross Profit Margins
    up approximately 25 basis points
    high materiality
    High
    Q1 FY27 Gross Profit Margins
    down approximately 25 to 50 basis points
    high materiality
    High
    Full-year FY27 SG&A Growth
    outpace sales growth
    high materiality
    Medium
    Q1 FY27 SG&A Growth
    grow several points ahead of sales growth
    high materiality
    Medium
    Full-year FY27 Effective Tax Rate
    approximately 22%
    medium materiality
    High
    Q1 FY27 Effective Tax Rate
    approximately 22%
    medium materiality
    High
    Full-year FY27 Inventory Growth
    at a rate at or below sales growth
    medium materiality
    Medium
    Full-year FY27 Capital Expenditures
    approximately $385 million
    high materiality
    High
    Full-year FY27 New Store Openings
    approximately 57
    medium materiality
    High
    Full-year FY27 Store Closings
    approximately 14
    medium materiality
    High
    Full-year FY27 Share Repurchases
    at least offset any dilution
    medium materiality
    Medium
    Anthropologie FY27 Operating Profit Rate
    mid-teen
    medium materiality
    High
    Free People Group FY27 Retail Segment Comps
    positive
    medium materiality
    High
    Free People Group FY27 Operating Profit Rate
    mid-teens
    medium materiality
    High
    Free People Group FY27 Wholesale Segment Growth
    healthy
    low materiality
    Medium
    Free People Group FY27 Wholesale Segment Profit Rate
    consistently strong
    low materiality
    Medium
    FP Movement FY27 New Store Openings
    at least 21
    medium materiality
    High
    Urban Outfitters Global FY27 Retail Segment Comps
    positive
    medium materiality
    High
    Urban Outfitters Global FY27 Profitability
    meaningful progress in growing
    medium materiality
    Medium
    Newly FY27 Growth Rates
    mid-double-digit
    high materiality
    High
    Newly Long-term Revenue Target
    $1 billion or more
    high materiality
    High
    Newly FY27 Profit Margins
    improving
    medium materiality
    Medium
    Urban Outfitters North America FY27 Operating Profit Rate
    low single-digit
    medium materiality
    High
    Urban Outfitters North America Long-term Operating Profit Rate
    high single-digit
    medium materiality
    High
    Anthropologie FY27 Comps
    low to mid-single-digit
    medium materiality
    High

    Segment performance

    11
    SegmentRevenueYoYQoQMargin
    URBN Total
    Record Q4 sales and operating profit. Full-year sales growth of 11%, operating profit growth of 28%, and operating profit rate growth of 128 bps.
    Operating profit rate: 115 bps growth
    		$1.8 billion10%—$159 million operating income
    Retail Segment (Total)
    All brands delivered positive Retail segment comps.
    Digital comps: slightly exceeding store comps
    		—greater than 5% comp——
    Anthropologie
    Growth fueled by digital channel and strength in own brands. Home accessories and furniture showing improvement.
    5 years of consecutive quarterly positive compsDigital channel: strengthStore comps: flatApparel: positive compsHome accessories: strengthFurniture: recent improvementsCustomer acquisition: positiveTraffic: increases across digital and store channels
    		—4% comp——
    Free People Group (Total)
    Driven by positive Retail segment comps, non-comp store growth, and strong Wholesale gains.
    Regular price sales: improved nicely vs prior yearInventory: well-controlled
    		10% increase——Record operating profit for the fourth quarter
    Free People (Core Brand)
    Positive comps driven by successes in key categories.
    Gifting and self-purchasing: successes in accessories, intimates, bottoms, sweaters
    		3% total sales growth1% retail segment comp——
    FP Movement
    Fueled by technical innovation and fashion in activewear. Expansion strategy on track with strong new store performance.
    New stores opened: 12Total retail locations: 88New sites: strong performanceBrand awareness: drivingCustomer acquisition: accelerating
    		29% total revenue growth21% retail segment comp——
    Urban Outfitters (Global)
    Positive momentum continued, driven by strong comps and improved markdown rates.
    Markdown rates: significant improvementRegular price selling: strength
    		—10% global Retail segment comp—Returned to profitability for the full year (modestly above breakeven)
    Urban Outfitters North America
    Delivered positive comps across all major categories.
    Women's apparel: strong bottoms trend, key items, proprietary collectionsSocial platforms: diversifying (Reddit, Pinterest, TikTok)Partnership: Canva (holiday wish lists)
    		—8% sales comp—Substantial reduction in operating loss
    Urban Outfitters Europe
    Standout performer with strong store business and consistent execution.
    Store business: strengthMarket share: capturing meaningful
    		—12% sales comp—Significant increase in profitability for quarter and full year
    Newly
    Exceptional performance driven by subscriber growth and logistics efficiencies.
    Average active subscribers: 40% increase vs prior year Q4Annual revenue: surpassed $500 million
    		43% total revenue growth——130 bps operating margin improvement (Q4), over $21 million total profitability increase (FY26), over 260 bps operating profit margin growth (FY26)
    Wholesale Segment
    Driven by growth in specialty store accounts, largely fueled by FP Movement.
    Specialty store accounts: growthFP Movement: healthy increases
    		—9% revenue growth——

    Operational metrics

    20
    Adjusted EPS
    $1.4338% increase YoY
    Q4 FY26

    Net income increased 33% to $131 million or $1.43 per diluted share.

    Gross Profit Dollars
    nearly $600 million14% increase YoY
    Q4 FY26

    URBN saw a 14% increase in gross profit dollars, reaching a record of nearly $600 million.

    SG&A Growth
    9%N/A
    Q4 FY26

    In the quarter, SG&A increased by 9% and leveraging the 14 basis points.

    Operating Income
    $159 million27% increase YoY
    Q4 FY26

    Overall, total URBN operating income rose by 27% compared to last year, reaching a Q4 record of $159 million.

    Operating Profit Growth
    28%N/A
    FY26

    enabled us to deliver 28% operating profit growth and an impressive 35% increase in earnings per share for the year.

    Donor-Advised Fund Contribution
    $46 million
    Q4 FY26

    During the quarter, we made a $46 million contribution to a donor-advised fund, which is included in other expense and income line item on our income statement.

    Newly Annual Revenue
    $500 millionsurpassed goal
    FY26

    The brand surpassed its goal of $500 million in annual revenue and increased its total profitability by over $21 million.

    Newly Total Profitability Increase
    over $21 millionN/A
    FY26

    The brand surpassed its goal of $500 million in annual revenue and increased its total profitability by over $21 million.

    Newly Operating Margin Improvement
    approximately 130 basis pointsN/A
    Q4 FY26

    This scale allowed the brand to deliver approximately 130 basis points of operating margin improvement during the quarter, fueled by efficiencies in logistics and the natural leverage of our operating expenses against strong revenue growth.

    Newly Operating Profit Margin Growth
    over 260 basis pointsN/A
    FY26

    This resulted in full year operating profit margin growth of over 260 basis points.

    FP Movement New Stores Opened
    12
    Q4 FY26

    successfully opened 12 new stores during the quarter, bringing the total to 88 retail locations to date.

    FP Movement Total Retail Locations
    88
    Q4 FY26

    bringing the total to 88 retail locations to date.

    Capital Expenditure Allocation
    40% retail store expansion and support
    FY27

    The FY '27 capital project spend is broken down as follows: approximately 40% for retail store expansion and support approximately 40% for logistics investments, and the remaining 20% from technology investments and home of profit expansion to support our growing businesses.

    Anthropologie Comp
    high single-digit
    January

    This contributed to a high single-digit comp in January, which resulted in a 4% comp increase for the quarter and was higher than our 3% forecasted comp.

    Anthropologie DTC Demand Trend
    mid-single-digit range
    January and February combined

    Our DTC demand trend, however, in the January and February combined time frame is relatively in line with our plan in the mid-single-digit range in both apparel and home.

    Urban Outfitters New Customers Acquired
    1 million
    last year

    Last year, we acquired 1 million new customers to the brand, and those customers are regular price customers who are spending more with us and shopping more frequently.

    Free People Average Unit Retail (AUR)
    healthy increase
    Q4 FY26

    Customer traffic was nicely positive across both channels, supported by a healthy increase in AUR in stores.

    Free People Group Regular Price Sales
    improved nicelyvs prior year
    Q4 FY26

    Importantly, across the Free People Group, regular price sales improved nicely versus the prior year, reflecting the high quality of the brand's offerings and strong customer demand.

    Free People Core Brand Regular Price Sales
    further acceleration
    February Q1 FY27

    Now as we move into Q1 of this year, in February, we see even a further acceleration within the brand, and that's despite walking again a lot of markdowns.

    FP Movement Performance and Streetwear Categories
    positive double-digit up
    Q4 FY26

    Both our performance and our Q from our streetwear business was were both positive double-digit up though.

    Industry KPIs

    9
    MetricValueDetails
    Sg a OPEX ratio9%%
    Comparable salesgreater than 5%%
    Store count growth57 new storesstores
    Gross margin drivers33.3%%
    Active customers nspacN/AN/A
    Share buyback capital returnN/AN/A
    Inventory position markdown riskN/AN/A
    Same sku like for like inflationN/AN/A
    Distribution supply chain cost economicsN/AN/A

    Risks & headwinds

    4
    Tariff Negative ImpactQ4 FY26 and FY26

    approximately 75 basis points on Q4 gross and operating profit rate; approximately 35 basis points on full-year FY26.

    Mitigation: mitigation efforts

    Lower IMU due to Increased TariffsQ1 FY27

    approximately 25 to 50 basis points reduction in Q1 FY27 gross profit margins.

    Mitigation: teams continue to work diligently on all our tariff mitigation efforts

    SG&A Growth Outpacing Sales GrowthFY27, Q1 FY27

    SG&A could outpace sales growth for full-year FY27; grow several points ahead of sales growth in Q1 FY27.

    Mitigation: Strategic technology investments expected to provide long-term benefits; variable SG&A spending can fluctuate with sales performance.

    Extreme Weather Events Impacting Store SalesQ1 FY27 (February)

    Caused softer store sales and Anthropologie to fall behind our plan in the weeks of February.

    Mitigation: Teams reacting to positive sales trends from January; expecting positive impact with normalized spring weather and new product flow in mid-March.

    What to watch in Q1 FY27

    5

    Anthropologie Store Sales Recovery

    mid-March
    Currentbehind plan in February
    Targetpositive impact on sales

    Why it matters

    Anthropologie's store sales were negatively impacted by extreme weather, and its recovery is key to meeting Q1 and full-year comp targets.

    Our teams have been hard at work at chasing into product categories that have outperformed and have a firm grasp on what the customer is telling us she wants. We believe that those receipts those receipts will flow into stores in mid-March, along with normalized spring weather trends and will positively impact our sales in the quarter.

    Q&A highlights

    8

    How did Anthropologie perform in Q4 and early Q1, especially with inventory?

    Anthropologie's sales accelerated in January, achieving a 4% comp, higher than the 3% forecast. However, February store sales were soft due to extreme weather, though DTC demand was in line with plans. Apparel inventory is in good shape, and home/furniture inventories were front-loaded and performing well. A slight increase in markdowns is planned due to the slower start.

    “Our sales accelerated coming out of the holiday period with receipt of new spring transitional product that was received in December. This contributed to a high single-digit comp in January, which resulted in a 4% comp increase for the quarter and was higher than our 3% forecasted comp.”

    asked by Lorraine Maikis · answered by Tricia Smith

    2 min read7 chapters

    Detailed Narrative

    01

    Q4 FY26 Performance Highlights

    Urban Outfitters, Inc. achieved record fourth-quarter results, with total revenue growing 10% to $1.8 billion and adjusted EPS increasing 38%. All retail segment brands delivered positive comparable sales, with FP Movement and Urban Outfitters showing standout performances. Newly continued its strong double-digit revenue growth, and the Wholesale segment grew 9%.

    02

    Gross Margin Expansion and Drivers

    The company saw a 14% increase in gross profit dollars, reaching nearly $600 million, and a 101 basis point improvement in the gross profit rate to 33.3%. This was primarily driven by lower markdowns at Urban Outfitters and Free People, occupancy leverage from strong sales, and reduced delivery expenses, which offset negative impacts from increased tariffs.

    03

    Strategic Investments in Technology and Logistics

    For FY27, URBN plans capital expenditures of $385 million, with 40% allocated to logistics investments and 20% to technology. These investments aim to expand capacity and automation for Newly and the retail segment, and to speed up internal product processes through AI tools, expecting long-term benefits in sales and reduced markdowns.

    04

    Brand-Specific Momentum and Profitability

    Anthropologie achieved its fifth consecutive year of positive quarterly comps, driven by digital strength and key product categories. Free People delivered impressive performance with 10% total revenue growth and record operating profit. Urban Outfitters returned to full-year profitability, significantly reducing its North American operating loss and increasing European profitability.

    05

    Newly's Continued Growth and Market Opportunity

    Newly delivered exceptional Q4 revenue growth of 43%, driven by a 40% increase in average active subscribers. The brand surpassed $500 million in annual revenue for FY26 and improved its full-year operating profit margin by over 260 basis points, reinforcing confidence in its path towards $1 billion in revenue.

    06

    Tariff Impact and Future Outlook

    Tariffs negatively impacted Q4 gross and operating profit rates by approximately 75 basis points and FY26 by 35 basis points. While FY27 gross profit margin guidance assumes tariffs remain, management notes potential upside if recent Section 122 tariff changes lead to incremental IMU benefits, particularly in the second half of the year.

    07

    Customer Engagement and Marketing

    Marketing efforts drove increases in traffic for the total URBN Retail segment and healthy double-digit growth in Newly subscribers. Urban Outfitters successfully diversified social platforms, leveraging Reddit, Pinterest, and TikTok, and partnered with Canva to generate significant engagement and customer acquisition.

    AI-generated summary of the company’s earnings call. Not investment advice.