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    URBN
    Earnings call· Apr 2026(Q1 FY27)

    URBAN OUTFITTERS Q1 FY27 earnings call URBN

    May 20, 2026 Source

    Executive summary

    Urban Outfitters Q1 FY27 — Record Sales & EPS, Strong Brand Performance

    Urban Outfitters delivered its seventh consecutive quarter of record sales and EPS, driven by broad-based strength across its diversified brand portfolio, including strong retail segment comps and significant growth in Nuuly and Wholesale. The company is actively investing in AI-related projects and managing tariff and fuel cost headwinds, while maintaining a strong customer base interested in fashion over price.

    Highlights

    5

    • Net sales grew 11% to a record $1.5 billion.

    • EPS grew 12% to a record $1.30.

    • Retail segment comp sales increased 6%, with all brands delivering positive comps.

    • Nuuly revenue grew 35%, adding over 110,000 average active subscribers.

    • Wholesale segment revenue increased 25%.

    Concerns

    4

    • Gross profit rate decreased 16 basis points to 36.6% due to a prior-year one-time benefit.

    • SG&A increased 12%, deleveraging by 5 basis points, partly due to increased store payroll, marketing, and technology investments.

    • Higher inbound freight costs and delivery expenses due to fuel surcharges represent an unfavorable impact of approximately 70 basis points per quarter.

    • Uncertainty and ongoing payment requirements for Section 122 tariffs despite being ruled illegal.

    Guidance & targets

    28
    CategoryTargetConfidence
    Q2 Total Company Sales Growth
    high single digit
    high materiality
    High
    Q2 Retail Segment Comp Sales Growth
    mid-single digit
    medium materiality
    High
    Q2 Urban Outfitters Retail Segment Comp Sales Growth
    high single-digit positive
    medium materiality
    High
    Q2 FP Group Retail Segment Comp Sales Growth
    high single-digit positive
    medium materiality
    High
    Q2 Anthropologie Retail Segment Comp Sales Growth
    low to mid-single-digit positive
    medium materiality
    High
    Q2 Nuuly Revenue Growth
    mid- to high 20s
    medium materiality
    High
    Q2 Wholesale Segment Growth
    mid-teens
    medium materiality
    High
    Full-Year FY27 Total Company Sales Growth
    positive high single-digit
    high materiality
    High
    Full-Year FY27 Retail Segment Comp Sales Growth
    mid-single-digit
    medium materiality
    High
    Full-Year FY27 Nuuly Revenue Growth
    mid-20s
    medium materiality
    High
    Full-Year FY27 Wholesale Segment Growth
    high single-digit
    medium materiality
    High
    Full-Year FY27 Gross Profit Margins
    up approximately 25 basis points
    high materiality
    High
    Q2 Gross Profit Margins
    flat to down by approximately 25 basis points
    high materiality
    High
    Full-Year FY27 SG&A Growth
    in line with sales growth
    medium materiality
    High
    Q2 SG&A Growth
    at or slightly ahead of sales growth
    medium materiality
    High
    Full-Year FY27 Effective Tax Rate
    approximately 22.5%
    low materiality
    High
    Q2 Effective Tax Rate
    approximately 22.5%
    low materiality
    High
    Full-Year FY27 Inventory Levels Growth
    at or below sales growth
    medium materiality
    High
    Full-Year FY27 Capital Expenditures
    approximately $475 million
    high materiality
    High
    Full-Year FY27 New Store Openings
    approximately 54
    medium materiality
    High
    Full-Year FY27 Store Closures
    approximately 19
    medium materiality
    High
    Full-Year FY27 FP Movement New Store Openings
    21
    low materiality
    High
    Full-Year FY27 Free People New Store Openings
    12
    low materiality
    High
    Full-Year FY27 Anthropologie New Store Openings
    13
    low materiality
    High
    Full-Year FY27 Urban Outfitters New Store Openings
    8
    low materiality
    High
    Urban Outfitters Operating Profit Rate
    low single-digit
    medium materiality
    High
    Urban Outfitters Long-Term Operating Profit Rate
    high single-digit
    medium materiality
    High
    Tariff Planning Rate
    15%
    high materiality
    Medium

    Segment performance

    9
    SegmentRevenueYoYQoQMargin
    URBN Total
    Achieved record Q1 sales and operating income, marking the seventh consecutive quarter of record sales and profits.
    		$1.5 billion11%—$140 million operating income
    Retail Segment (Total)
    All retail segment brands delivered positive comparable sales.
    Digital comps: slightly exceeding store comps
    		—6% comp——
    Anthropologie
    Rebounded from a slow start in February with positive comps in March and April, driven by fresh spring receipts and strength in core women's categories and home furniture. Q2 guidance: low to mid-single-digit positive comps.
    Positive comps: 5+ years consecutiveWomen's apparel comps: positiveShoes comps: positiveHome comps: positiveAccessories comps: negative
    		—2% retail segment comp——
    Urban Outfitters
    Continued to build meaningful momentum with strong performance across North America and Europe. European team produced a remarkable 12% retail segment comp. Q2 guidance: high single-digit positive Retail segment comps. Targeting low single-digit operating profit rate for FY27, high single-digit long-term.
    North America digital comps: outpaced store compsEurope Retail segment comp: 12%Europe store business: led digital channelNorth America women's apparel comps: positiveNorth America accessories comps: positiveNorth America home comps: positiveReg price sales: outpaced total comp
    		over 11% total sales growth9% global Retail segment comp——
    Nuuly
    Delivered strong performance, scaling subscriber base and financial results. Improvement driven by operating leverage and effective marketing. Q2 guidance: mid- to high 20s revenue growth.
    Average active subscribers growth: 33% (+110,000 YoY)Current active subscribers: nearing 0.5 millionOperating profit rate: 6%
    		35% revenue growth35%—$10 million operating profit
    Wholesale Segment
    Delivered exceptional double-digit revenue growth across both specialty and department store accounts. Q2 guidance: mid-teens growth.
    		25% increase in revenue25%——
    Free People Group (Total)
    Delivered an exceptionally strong quarter with sustained momentum across both wholesale and retail segments. Achieved record low markdown rates due to exceptional regular price selling.
    Retail segment growth: 14%Retail segment comp: 10%Wholesale revenue surge: 26%Consecutive positive Retail segment comps: 24 quarters
    		17% total revenue increase17%—record first quarter profitability
    Free People (Brand)
    Showed broad-based strength across the entire assortment and benefited from positive traffic, conversion, and higher transaction values.
    Wholesale growth: 16%Retail segment growth: 11%Retail segment comp: 9%Store performance: outpaced digital across North America and Europe
    		12% total revenue growth12%——
    FP Movement
    Continued its impressive trajectory with strong non-comp performance and strategic emphasis on bottoms and bra categories. Disciplined execution led to year-over-year merchandise margin improvements despite IMU headwinds.
    Retail segment comp: 15%Wholesale growth: 48%New store openings (Q1): 6 units
    		32% total brand revenue growth32%——

    Operational metrics

    24
    Net sales
    $1.5 billion11% YoY growth
    Q1 FY27

    Record quarterly sales.

    EPS
    $1.3012% YoY growth
    Q1 FY27

    Record quarterly earnings per share.

    Gross profit dollars
    11% increaseYoY
    Q1 FY27

    Increase in absolute gross profit.

    Gross profit rate
    36.6%decreased 16 bps YoY
    Q1 FY27

    Decrease primarily due to a one-time benefit in the prior year, partially offset by markdown rate improvements.

    SG&A dollars
    12% increaseYoY
    Q1 FY27

    Increase in absolute SG&A expenses.

    SG&A deleverage
    5 bps
    Q1 FY27

    SG&A deleveraging, partially offset by a legal matter benefit.

    Operating income
    $140 million9% YoY growth
    Q1 FY27

    Record Q1 operating income.

    Net income
    $116 million
    Q1 FY27

    Total net income for the quarter.

    Share repurchases
    $300 million
    Q1 FY27

    Amount spent on share repurchases during the quarter.

    Nuuly average active subscribers
    +110,000YoY increase
    Q1 FY27

    Increase in average active subscribers for Nuuly compared to the prior year.

    Nuuly active subscribers
    nearing 0.5 million
    as of call date

    Current number of active subscribers for Nuuly.

    Fuel cost impact on IMU
    45 bpsnegative impact
    Q1 FY27

    Impact of higher inbound freight costs due to fuel surcharges.

    Fuel cost impact on outbound delivery and freight
    25 bpsnegative impact
    Q1 FY27

    Impact of increased fuel surcharges on delivery expenses.

    Total fuel cost impact
    70 bpsunfavorable impact
    per quarter

    Combined unfavorable impact of fuel surcharges on inbound and outbound costs.

    IEEPA tariff refunds
    $100 million
    Q2 FY27

    Expected refunds from IEEPA tariffs ruled illegal, to be recorded as a one-time benefit.

    Capital expenditures
    $475 million
    FY27

    Planned capital expenditures for the fiscal year, broken down by purpose.

    New store openings
    54
    FY27

    Total planned new store openings for the fiscal year.

    Store closures
    19
    FY27

    Total planned store closures for the fiscal year.

    Net new store growth
    35
    FY27

    Net new store growth for the fiscal year (54 openings - 19 closures).

    FP Movement new store openings
    6
    Q1 FY27

    New store openings for FP Movement during the first quarter.

    FP Movement new store openings plan
    >20
    FY27

    Planned new store openings for FP Movement for the current fiscal year.

    Free People European locations
    13
    current

    Number of Free People locations currently operating in Europe.

    Urban Outfitters operating profit rate
    low single-digit
    FY27

    Target operating profit rate for the Urban Outfitters brand for the full fiscal year.

    Urban Outfitters long-term operating profit rate
    high single-digit
    long-term

    Long-term target operating profit rate for the Urban Outfitters brand.

    Industry KPIs

    9
    MetricValueDetails
    Sg a OPEX ratio5 bpsbps
    Comparable sales6%%
    Store count growth54units
    Gross margin drivers36.6%%
    Active customers nspacnearing 0.5 millionsubscribers
    Share buyback capital return$300 millionUSD
    Inventory position markdown riskat or below sales growth
    Same sku like for like inflation15%%
    Distribution supply chain cost economics45 bpsbps

    Deals & partnerships

    2
    DoorDashExpanded delivery partnership for Urban Outfitters

    Urban Outfitters launched its partnership with DoorDash in April, which successfully expanded through May, showing encouraging early conversion and reach.

    Barry'sCollaboration for FP Movement

    FP Movement successfully activated a key partnership with Barry's, a high-intensity training studio chain, expanding into Selfridges in London.

    Risks & headwinds

    5
    Higher inbound freight costsremainder of the year

    45 basis points impact on IMU

    Mitigation: None explicitly stated, but linked to oil price declines for potential reduction.

    Higher delivery expenses due to fuel surchargesremainder of the year

    25 basis points impact on outbound delivery and freight

    Mitigation: None explicitly stated, but linked to oil price declines for potential reduction.

    Section 122 tariffsmid-March through end of July

    10% tariff

    Mitigation: Possible future refunds, despite being ruled illegal.

    Uncertainty regarding post-Section 122 tariffssecond half of FY27

    Planning for a 15% across-the-board tariff for imports

    Mitigation: Conservative planning assumption; potential for net favorable benefit to IMU if 15% rate is accurate.

    Soft European marketcurrent

    Economies struggling, high energy prices

    Mitigation: Strong product and market share gains by Urban and Free People brands.

    What to watch in Q2 FY27

    5

    Anthropologie comp sales

    Q2 FY27
    Current2% (Q1 FY27)
    Targetlow to mid-single-digit positive

    Why it matters

    Demonstrates sustained turnaround from a slow start and continued brand health.

    Overall, we are pleased with the brand's execution and based on our current plans, we believe the brand has the ability to deliver low to mid-single-digit positive comps in the second quarter.

    Q&A highlights

    7

    What drove Anthropologie's rebound in Q1, how did it impact margins, and what is the confidence level for continued profitable positive comps?

    Anthropologie's Q1 rebound was driven by fresh spring receipts in March and April, strong performance in core women's categories (pants, denim, dresses, shoes), and home furniture sales. The brand achieved a 2% comp, with increases in traffic and average unit retail. Management is confident in delivering low to mid-single-digit positive comps in Q2.

    “The results were really driven by the strength in core women's categories like pants, denim, dresses and shoes as well as Mother's Day gifting categories like beauty. In addition to the continued momentum we're seeing in full-price furniture sales really drove our home comps nicely positive. We ended the quarter with a 2 comp, driven by a full price comp increase as well as increases in traffic and AUR in both channels.”

    asked by Lorraine Maikis · answered by Tricia Smith

    2 min read6 chapters

    Detailed Narrative

    01

    Record Performance and Diversified Growth

    Urban Outfitters achieved its seventh consecutive quarter of record sales and EPS, with net sales growing 11% to $1.5 billion and EPS increasing 12% to $1.30. This consistent performance is attributed to the company's diversified brand portfolio, which allows for overall stability even when individual brands experience varying results. All retail segment brands delivered positive comparable sales, complemented by strong double-digit revenue growth in Nuuly and the Wholesale segment.

    02

    Brand-Specific Momentum and Turnarounds

    Anthropologie successfully rebounded from a slow start in Q1, achieving a 2% retail segment comp driven by fresh spring receipts and strong performance in women's apparel and home. Urban Outfitters continued its strong momentum with an 11% total sales growth and a 9% global retail segment comp, excelling in both North America and Europe. Free People and FP Movement maintained exceptional growth, with FP Group revenue up 17% and FP Movement specifically growing 32%.

    03

    Nuuly's Scaling and Profitability

    Nuuly demonstrated robust growth, with total revenue increasing 35% and average active subscribers rising 33%, adding over 110,000 new subscribers year-over-year and nearing 0.5 million active subscribers. The brand generated an operating profit of $10 million, representing a 6% operating profit rate, indicating strong operating leverage and scalability. Management remains committed to scaling Nuuly towards its long-term potential while improving profitability.

    04

    Navigating Tariff and Fuel Cost Headwinds

    The company is actively managing complex tariff changes and rising fuel costs. It expects to receive approximately $100 million in refunds in Q2 FY27 from previously imposed IEEPA tariffs that were ruled illegal. However, it continues to pay Section 122 tariffs and is conservatively planning for a 15% blended tariff on imports in the second half of FY27. Higher fuel surcharges are projected to have an unfavorable impact of approximately 70 basis points on gross margins per quarter.

    05

    Strategic Investments in AI and Technology

    Urban Outfitters is aggressively deploying AI and machine learning across various business functions to enhance efficiency and customer experience. These investments span personalization, search, fraud screening, logistics optimization, customer service, and product development. The company views AI as a significant long-term unlock for accelerating product life cycles and improving overall operational effectiveness.

    06

    Store Expansion and Capital Allocation

    For fiscal year 2027, URBN plans capital expenditures of approximately $475 million, with 35% allocated to retail store expansion, 50% to logistics investments, and 15% to technology and home office expansion. The company intends to open 54 new stores and close 19, resulting in a net increase of 35 stores, primarily driven by growth in FP Movement, Free People, and Anthropologie locations.

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