ABERCROMBIE & FITCH CO /DE/

RESULTS OF OPERATIONS

The estimated basis point (“BPS”) change disclosed throughout this Results of Operations section has been rounded based on the change in the percentage of net sales.

Net sales

Net sales by segment are presented by attributing revenues to a physical store location or geographical region that fulfills the order. The Company’s net sales by reportable segment for the thirteen weeks ended May 2, 2026 and May 3, 2025 were as follows:

(1)Comparable sales are calculated on a constant currency basis. Refer to“NON-GAAP FINANCIAL MEASURES,” for further details on the comparable sales calculation.

For the first quarter of Fiscal 2026, net sales increased 2%, as compared to the first quarter of Fiscal 2025. The increase was primarily attributable to low-single-digit AUR growth, driven by selected changes to tickets and promotions, coupled with an increase in new owned and operated stores and favorable foreign currency. The year-over-year increase in net sales reflects negative comparable sales of (1)%, as compared to the first quarter of Fiscal 2025. On a geographic basis for the first quarter of Fiscal 2026:

•Net sales growth in the Americas region of 3% and 1% on a reported and comparable sales basis, respectively. The reported increase was primarily attributable to low-single-digit AUR growth, and low-single-digit direct channel unit volume growth with an increases in Company-owned and operated stores, and digital channels. The comparable sales growth percentage is lower than net sales growth percentage, as comparable sales excludes the net impact of new store openings during the period which had a benefit on net sales growth.

•Net sales decline in the EMEA region of (10)% and (11)% on a reported and comparable sales basis, respectively. The reported decline was attributable lower third-party volume, particularly in the Middle East and other European markets as regional conflict conditions escalated during the quarter, partially offset by a low-single-digit AUR growth and favorable foreign currency. Direct unit channel volume decreased by high-single digits, with decreases in Company-owned and operated stores and digital channels.

•Net sales growth in the APAC region of 24% and 15% on a reported and comparable sales basis, respectively. The reported increase was led by high-single-digit AUR growth, higher third-party volume and favorable foreign currency. Direct unit channel volume increased low-double digits with increases in Company-owned and operated stores and digital channels. The comparable sales growth percentage is lower than net sales growth percentage, as comparable sales excludes the net impact of new store openings during the period which had a benefit on net sales growth.

The Company’s net sales by brand for the thirteen weeks ended May 2, 2026 and May 3, 2025 were as follows:

(1)Comparable sales are calculated on a constant currency basis. Refer to“NON-GAAP FINANCIAL MEASURES,” for further details on the comparable sales calculation.

Cost of sales, exclusive of depreciation and amortization

For the first quarter of Fiscal 2026, cost of sales, exclusive of depreciation and amortization, as a percentage of net sales decreased by approximately 80 basis points, as compared to the first quarter of Fiscal 2025. The percentage decrease was primarily attributable to cost of sales leverage from a 180 basis point decline in freight costs, a decline in foreign currency and AUR growth driven by selected changes to tickets and promotions, partially offset by 180 basis points of adverse tariff impacts, compared to the first quarter of Fiscal 2025.

Selling expense

For the first quarter of Fiscal 2026, selling expense increased by $31 million, as compared to the first quarter of Fiscal 2025. Selling expense as a percentage of net sales increased 230 basis points, as compared to the first quarter of Fiscal 2025. The increase in rate was primarily driven by expense deleverage, with an approximate 190 basis point increase in store occupancy, payroll and other controllable costs, an approximate 90 basis point increase in marketing, partially offset by an approximate 60 basis point decline in fulfillment expense.

General and administrative expense

For the first quarter of Fiscal 2026, general and administrative expense increased by $8 million, as compared to the first quarter of Fiscal 2025. General and administrative expense as a percentage of net sales increased 50 basis points, as compared to the first quarter of Fiscal 2025. The increase in expense rate was primarily driven by a 60 basis point increase in employee compensation costs, occupancy and other administrative expenses.

Other operating (income) loss, net

Operating income

(1) Segment operating income as a percentage of net sales is calculated by attributing the segment’s operating income with the respective net sales in the segment.

For the first quarter of Fiscal 2026, operating income decreased by $13 million, or 130 basis points, as a percentage of net sales, as compared to the first quarter of Fiscal 2025.

•Operating income for the Americas region increased $4 million, and decreased 20 basis points as a percentage of region net sales, as compared to the first quarter of Fiscal 2025. The decrease as a percent of sales was primarily attributed to deleverage in marketing investments and store-related expenses, partially offset by cost of sales leverage.

•Operating income for the EMEA region decreased $12.6 million or 670 basis points as a percentage of region net sales, as compared to the first quarter of Fiscal 2025. The decrease as a percent of sales is primarily attributed to deleverage in store-related expenses, partially offset by cost of sales leverage.

•Operating (loss) for the APAC region decreased by $3.5 million or 990 basis points as a percentage of region net sales, as compared to the first quarter of Fiscal 2025. The decrease as a percent of sales is primarily attributed to leverage in cost of sales, store-related, fulfillment and administrative expenses.

Interest income, net

For the first quarter of Fiscal 2026, interest income, net decreased $1.5 million, as compared to the first quarter of Fiscal 2025. The net decrease was a result of a reduction in interest income due to the decrease in balance and yield on time deposits and money market accounts compared to the first quarter of Fiscal 2025.

Income tax expense

The change in the effective tax rate for the first quarter of Fiscal 2026, as compared with the first quarter of Fiscal 2025, is due to jurisdictional mix and a lower tax benefit on share-based compensation compared with the prior-year period

Refer to Note 9, “INCOME TAXES.”

Net income attributable to A&F

Net income per share attributable to A&F

(1)Refer to “NON-GAAP FINANCIAL MEASURES” for further details.

EBITDA

(1)EBITDA is a supplemental financial measure that is not defined or prepared in accordance with GAAP. EBITDA is defined as net income before interest, income taxes and depreciation and amortization.