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What changed in ABERCROMBIE & FITCH CO /DE/'s 10-K — 2025 vs 2026

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Paragraph-level year-over-year comparison of ABERCROMBIE & FITCH CO /DE/'s 2025 and 2026 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2026 report.

+302 added−275 removedSource: 10-K (2025-03-31) vs 10-K (2024-04-01)

Top changes in ABERCROMBIE & FITCH CO /DE/'s 2026 10-K

302 paragraphs added · 275 removed · 239 edited across 10 sections

Item 1. Business

Business — how the company describes what it does

29 edited+4 added−2 removed33 unchanged
Biggest changeWe are subject to income taxes in many U.S. and foreign jurisdictions. In addition, our products are subject to import and excise duties and/or sales, consumption or value-added taxes (“VAT”) in many jurisdictions. We record tax expense based on our estimates of future payments, which include reserves for estimates of probable settlements of foreign and domestic tax audits.
Biggest changeFluctuations in our tax obligations and effective tax rate may result in volatility in our results of operations could have a material adverse impact on our business. We are subject to income taxes in many U.S. and foreign jurisdictions. In addition, our products are subject to import and excise duties and/or sales, consumption or value-added taxes (“VAT”) in many jurisdictions.
There is a risk that current or former associates, executives, directors, advisers or third party-service providers of the Company, or others who are actually or perceived to be affiliated with us, could engage, deliberately or recklessly, in misconduct or fraud that creates legal exposure for us and adversely affects our business.
There is a risk that current or former associates, executives, directors, advisers, third party-service providers or business partners of the Company, or others who are actually or perceived to be affiliated with us, could engage, deliberately or recklessly, in misconduct or fraud that creates legal exposure for us and adversely affects our business.
Stockholder activism, which could take many forms or arise in a variety of situations, remains popular with many public investors. Due to the potential volatility of our stock price and for a variety of other reasons, we may become the target of securities litigation or stockholder activism.
Stockholder activism, which could take many forms or arise in a variety of situations, remains popular with many public investors. Due to the volatility of our stock price and for a variety of other reasons, we may become the target of securities litigation or stockholder activism.
The agreements related to the ABL Facility and the Senior Secured Notes contain restrictive covenants that, subject to specified exemptions, restrict, among other things, the ability of the Company and its subsidiaries to: incur, assume or guarantee additional indebtedness; grant or incur liens; sell or otherwise dispose of assets, including capital stock of subsidiaries; make investments in certain subsidiaries; pay dividends or make distributions on our capital stock; redeem or repurchase capital stock; change the nature of our business; and consolidate or merge with or into, or sell substantially all of the assets of the Company or A&F Management to another entity.
The agreements related to the ABL Facility contain restrictive covenants that, subject to specified exemptions, restrict, among other things, the ability of the Company and its subsidiaries to: incur, assume or guarantee additional indebtedness; grant or incur liens; sell or otherwise dispose of assets, including capital stock of subsidiaries; make investments in certain subsidiaries; pay dividends or make distributions on our capital stock; redeem or repurchase capital stock; change the nature of our business; and consolidate or merge with or into, or sell substantially all of the assets of the Company or A&F Management to another entity.
Misconduct or illegal activities by our current and former associates, directors, advisers, third-party service providers, or others affiliated, or perceived to be affiliated, with the Company could subject to us to reputational harm, regulatory scrutiny or inquiries, or legal liability .
Misconduct or illegal activities by our current and former associates, directors, advisers, third-party service providers or business partners, or others affiliated, or perceived to be affiliated, with the Company could subject to us to reputational harm, regulatory scrutiny or inquiries, or legal liability .
In addition, there is no assurance that we would have the cash resources available to repay such accelerated obligations. Moreover, the Senior Secured Notes and ABL Facility are secured by certain of our real property, inventory, intellectual property, general intangibles and receivables, among other things, and lenders may exercise remedies against the collateral in an event of default.
In addition, there is no assurance that we would have the cash resources available to repay such accelerated obligations. Moreover, the ABL Facility is secured by certain of our real property, inventory, intellectual property, general intangibles and receivables, among other things, and lenders may exercise remedies against the collateral in an event of default.
Responding to stockholder activists campaigns may involve significant expense and diversion of management’s attention and resources without yielding any improvement in our results of operations or financial condition.
Responding to stockholder activists’ campaigns may involve significant expense and diversion of management’s attention and resources without yielding any improvement in our results of operations or financial condition.
If an event of default under either related agreement occurs, any outstanding obligations under the Senior Secured Notes and the ABL Facility could be declared immediately due and payable or the lenders or noteholders could foreclose on or exercise other remedies with respect to the assets securing the indebtedness under the Senior Secured Notes and the ABL Facility.
If an event of default under either related agreement occurs, any outstanding obligations under the ABL Facility could be declared immediately due and payable or the lenders or noteholders could foreclose on or exercise other remedies with respect to the assets securing the indebtedness under the ABL Facility.
The agreements related to A&F Management’s senior secured asset-based revolving credit facility and senior secured notes include restrictive covenants that limit our flexibility in operating our business and our inability to obtain additional credit on reasonable terms in the future could have an adverse impact on our business.
The agreements related to A&F Management’s senior secured asset-based revolving credit facility includes restrictive covenants that limit our flexibility in operating our business and our inability to obtain additional credit on reasonable terms in the future could have an adverse impact on our business.
Furthermore, Section 22 of the Securities Act creates concurrent jurisdiction for state and federal courts over all suits brought to enforce any duty or liability created by the Securities Act or the rules and regulations thereunder. Abercrombie & Fitch Co. 25 2023 Form 10-K Table of Contents Item 1B. Unresolved Staff Comments None.
Furthermore, Section 22 of the Securities Act creates concurrent jurisdiction for state and federal courts over all suits brought to enforce any duty or liability created by the Securities Act or the rules and regulations thereunder. Abercrombie & Fitch Co. 24 2024 Form 10-K Table of Contents Item 1B. Unresolved Staff Comments None.
The exclusive forum provisions will be applicable to the fullest extent permitted by applicable law, subject to certain exceptions. Section 27 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) creates exclusive federal jurisdiction over all suits brought to enforce any duty or liability created by the Exchange Act or the rules and regulations thereunder.
The exclusive forum provisions will be applicable to the fullest extent permitted by applicable law, subject to certain exceptions. Section 27 of the Exchange Act creates exclusive federal jurisdiction over all suits brought to enforce any duty or liability created by the Exchange Act or the rules and regulations thereunder.
Failure to register our trademarks or purchase or license the right to use our trademarks or logos in these jurisdictions could limit our ability to obtain supplies from, or manufacture in, less costly markets or penetrate new markets should our business plan include selling our merchandise in those non-U.S. jurisdictions.
Failure to register our trademarks or purchase or license the right to use our trademarks or logos in these jurisdictions could limit our ability to obtain supplies from, or manufacture in, less costly markets or penetrate new markets should our business plan include selling our merchandise or granting rights to our franchise, wholesale, and licensing partners in those non-U.S. jurisdictions.
There can be no assurance that we would be able to obtain sufficient funds to enable us to repay or refinance our debt obligations on commercially reasonable terms, or at all. Changes in market conditions could potentially impact the size and terms of a replacement facility or facilities in the future.
We may, from time to time, incur indebtedness. There can be no assurance that we would be able to obtain sufficient funds to enable us to repay or refinance any future obligations on commercially reasonable terms, or at all. Changes in market conditions could potentially impact the size and terms of a replacement facility or facilities in the future.
Abercrombie & Fitch Co. 24 2023 Form 10-K Table of Contents Our amended and restated bylaws provide that certain courts in the State of Delaware or the federal district courts of the United States will be the sole and exclusive forum for substantially all disputes between us and our stockholders, which could limit our shareholders’ ability to obtain a favorable judicial forum for disputes with us or our directors, officers, or employees.
Our amended and restated bylaws provide that certain courts in the State of Delaware or the federal district courts of the United States will be the sole and exclusive forum for substantially all disputes between us and our stockholders, which could limit our shareholders’ ability to obtain a favorable judicial forum for disputes with us or our directors, officers, or employees.
Additionally, we could fail to meet our public reporting requirements on a timely basis, and be subject to fines, penalties, investigations or judgements, all of which could negatively affect investor confidence and adversely impact our stock price. LEGAL, TAX, REGULATORY AND COMPLIANCE RISKS.
Additionally, we could fail to meet our public reporting requirements on a timely basis, and be subject to fines, penalties, investigations or judgements, all of which could negatively affect investor confidence and adversely impact our stock price. Abercrombie & Fitch Co. 21 2024 Form 10-K Table of Contents LEGAL, TAX, REGULATORY AND COMPLIANCE RISKS.
For example, Michael Jeffries, who served as chief executive officer of the Company from 1992 to 2014, has been accused of sexual abuse and exploitation, which include claims relating to behavior that is alleged to have occurred during his tenure with us. Litigation has been filed against Mr. Jeffries and the Company that relates to this alleged behavior.
In particular, Michael Jeffries, who served as chief executive officer of the Company from 1992 to 2014, has been accused of sexual abuse and exploitation, which accusations include claims relating to behavior that is alleged to have occurred during his prior tenure with us. Criminal charges have been filed against Mr.
The Amended and Restated Credit Agreement (the “Amended and Restated Credit Agreement”) of Abercrombie & Fitch Management Co. (“A&F Management”), a wholly-owned indirect subsidiary of A&F, provides for a senior secured asset-based revolving credit facility of up to $400 million (the “ABL Facility”), which matures on April 29, 2026.
The Amended and Restated Credit Agreement (as amended, the “ABL Credit Agreement”) of Abercrombie & Fitch Management Co. (“A&F Management”), a wholly-owned indirect subsidiary of A&F, provides for a senior secured asset-based revolving credit facility of up to $500 million (the “ABL Facility”), which matures on August 2, 2029.
Abercrombie & Fitch Co. 22 2023 Form 10-K Table of Contents Litigation and any future stockholder activism could have a material adverse impact on our business. We, along with third parties we do business with, are involved, from time to time, in litigation arising in the ordinary course of business.
Litigation and any future stockholder activism could have a material adverse impact on our business. We, along with third parties we do business with, are involved, from time to time, in litigation arising in the ordinary course of business.
Abercrombie & Fitch Co. 21 2023 Form 10-K Table of Contents I f we identify a material weakness in our internal control over financial reporting, fail to remediate a material weakness, or fail to establish and maintain effective internal control over financial reporting, our ability to accurately and timely report our financial results could be adversely affected.
I f we identify a material weakness in our internal control over financial reporting, fail to remediate a material weakness, or fail to establish and maintain effective internal control over financial reporting, our ability to accurately and timely report our financial results could be adversely affected.
Patent and Trademark Office and the registries of countries in key markets within the Company’s sales and distribution channels. In addition, these trademarks are either registered, or the Company has applications for registration pending, with the registries of many of the foreign countries in which the manufacturers of the Company’s products are located.
In addition, these trademarks are either registered, or the Company has applications for registration pending, with the registries of many of the foreign countries in which the manufacturers of the Company’s products are located.
Although the U.S. has not yet enacted legislation implementing Pillar Two Rules, other countries where the Company does business, including the U.K. and Germany, have enacted legislation implementing Pillar Two Rules which are effective from January 1, 2024.
Although the U.S. effectively withdrew from the OECD global tax agreement in January 2025, other countries where the Company does business, including the U.K. and Germany, have enacted legislation implementing Pillar Two Rules, which are effective from January 1, 2024.
Failure to correctly calculate or remit the appropriate amounts could subject us to substantial fines and penalties that could have an adverse effect on our financial condition, results of operations or cash flows.
In some global markets, we are required to withhold and remit VAT to the appropriate local tax authorities. Failure to correctly calculate or remit the appropriate amounts could subject us to substantial fines and penalties that could have an adverse effect on our financial condition, results of operations or cash flows.
Litigation matters may include, but are not limited to, contract disputes, employment-related actions, labor relations, commercial litigation, intellectual property rights, product safety, environmental matters and shareholder actions. Litigation, in general, may be expensive and disruptive.
Litigation matters may include, but are not limited to, contract disputes, employment-related actions, alleged misconduct by current or former associates, labor relations, commercial litigation, intellectual property rights, privacy litigation, product safety, environmental matters and shareholder actions. Abercrombie & Fitch Co. 22 2024 Form 10-K Table of Contents Litigation, in general, may be expensive and disruptive.
Any changes in regulations, the imposition of additional regulations, or the enactment of any new or more stringent legislation including the areas referenced above, could adversely affect our business and results of operations. Laws and regulations at the local, state, federal and various global levels frequently change, and the ultimate cost of compliance cannot be precisely estimated.
Any changes in regulations, the imposition of additional regulations, or the enactment of any new or more stringent legislation including the areas referenced above, could adversely affect our business and results of operations.
Abercrombie & Fitch Co. 23 2023 Form 10-K Table of Contents Changes in the regulatory or compliance landscape could have a material adverse impact on our business.
Changes in the regulatory or compliance landscape could have a material adverse impact on our business.
ITEM 1. BUSINESS ,” our business could be adversely impacted.
ITEM 1. BUSINESS ” of this Annual Report on Form 10-K, our business could be adversely impacted.
At any time, many tax years are subject to audit by various taxing jurisdictions. The results of these audits and negotiations with taxing authorities may affect the ultimate settlement of these issues. As a result, we expect that throughout the year, there could be ongoing variability in our quarterly tax rates as taxable events occur and exposures are evaluated.
As a result, we expect that throughout the year, there could be ongoing variability in our quarterly tax rates as taxable events occur and exposures are evaluated.
In addition, in early March 2024, the Delaware Court of Chancery ruled that Mr. Jeffries was entitled to advancement by the Company of his defense costs for the litigation. Fluctuations in our tax obligations and effective tax rate may result in volatility in our results of operations could have a material adverse impact on our business.
In addition, in March 2024 and March 2025, the Delaware Court of Chancery ruled that Mr. Jeffries was entitled to advancement by the Company of his defense costs for the civil litigation and for his defense costs for the criminal prosecution against him, respectively.
The Company does not expect The Pillar Two Rules will have a material impact on the effective tax rate for fiscal 2024, but the rules will likely increase tax complexity, and may adversely affect our provision for income taxes. In some global markets, we are required to withhold and remit VAT to the appropriate local tax authorities.
The implementation of the Pillar Two Rules in each jurisdiction in which the Company operates did not have a material impact on its effective tax rate for Fiscal 2024, and the Company does not project a material impact on the effective tax rate for Fiscal 2025.
Removed
A&F Management’s senior secured notes (the “Senior Secured Notes””) have a fixed 8.75% interest rate and mature on July 15, 2025.
Added
Jeffries, and there are multiple pending civil actions against Mr. Jeffries and the Company that relate to this alleged behavior.
Removed
We have, and expect to continue to have, a level of indebtedness. In addition, we may, from time to time, incur additional indebtedness. We may need to refinance all or a portion of our existing indebtedness before maturity, including the Senior Secured Notes, and any indebtedness under the ABL Facility.
Added
We record tax expense based on our estimates of future payments, which include reserves for estimates of probable settlements of foreign and domestic tax audits. At any time, many tax years are subject to audit by various taxing jurisdictions. The results of these audits and negotiations with taxing authorities may affect the ultimate settlement of these issues.
Added
Patent and Trademark Office and the registries of countries in key markets within the Company’s owned and operated sales and distribution channels, and those in which the Company’s franchise, wholesale, and licensing partners have sales and distribution rights.
Added
Abercrombie & Fitch Co. 23 2024 Form 10-K Table of Contents Laws and regulations at the local, state, federal and various global levels frequently change, and the ultimate cost of compliance cannot be precisely estimated.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

62 edited+14 added−3 removed80 unchanged
Biggest changeIndividual country laws and regulations governing the use and availability of these social media platforms continue to evolve, and if we are unable to effectively use social media platforms as marketing tools our ability to retain or acquire customers and our financial condition may suffer; • Retaining customers, including our loyalty club members, and the resulting increased marketing costs to acquire new customers; • Developing innovative, high-quality merchandise in styles that appeal to consumers and in ways that favorably distinguish us from our competitors; • Countering the pricing and promotional activities of our competitors without diminishing the aspirational nature of our brands and brand equity; and Abercrombie & Fitch Co. 13 2023 Form 10-K Table of Contents • Identifying and assessing disruptive innovation, by existing or new competitors, that could alter the competitive landscape by: improving the customer experience and heightening customer expectations; transforming supply chain and corporate operations through digital technologies and artificial intelligence; and enhancing management decision-making through use of data analytics to develop new, consumer insights.
Biggest changeIndividual country laws and regulations governing the use and availability of these social media platforms continue to evolve, and if we are unable to effectively use social media platforms as marketing tools our ability to retain or acquire customers and our financial condition may suffer; • Effectively establishing and maintaining relationships with key brand representatives, influencers, athletes, and other celebrities as part of our marketing strategy to promote our brands and products; • Retaining customers, including our loyalty club members, and the resulting increased marketing costs to acquire new customers; • Developing innovative, high-quality merchandise in styles that appeal to consumers and in ways that favorably distinguish us from our competitors; • Operating in a highly promotional retail environment; Abercrombie & Fitch Co. 12 2024 Form 10-K Table of Contents • Engaging in promotional activity and appropriately pricing our products without diminishing the aspirational nature of our brands and brand equity; and • Identifying and assessing disruptive innovation, by existing or new competitors, that could alter the competitive landscape by: improving the customer experience and heightening customer expectations; transforming supply chain and corporate operations through changes to digital technologies and innovations, including the use of artificial intelligence (“AI”) and machine learning; and enhancing management decision-making through use of data analytics to develop new, consumer insights.
In addition, we could be criticized for the speed of adoption of such initiatives or goals, or the scope of such initiatives or goals. As a result, we could suffer negative publicity and our reputation could be adversely impacted, which in turn could have a negative impact on investor perception and our products' acceptance by consumers.
In addition, we could be criticized for the speed of adoption of such initiatives and goals, or the scope of such initiatives or goals. As a result, we could suffer negative publicity and our reputation could be adversely impacted, which in turn could have a negative impact on investor perception and our products' acceptance by consumers.
The increased focus by investors and other stakeholders on the ESG practices of publicly traded companies, like us, has included or may in the future include expanding mandatory and voluntary reporting, diligence, and disclosure on topics such as climate change, human capital, labor and risk oversight, and could expand the nature, scope, and complexity of matters that we are required to control, assess and report.
The focus by investors and other stakeholders on the ESG practices of publicly traded companies, like us, has included or may in the future include expanding mandatory and voluntary reporting, diligence, and disclosure on topics such as climate change, human capital, labor and risk oversight, and could expand the nature, scope, and complexity of matters that we are required to control, assess and report.
Furthermore, the existence or threat of any other unforeseen interruption of commerce, including as a result of geopolitical or armed conflict and the possible interference with international trade, supplier deliveries or freight costs, could negatively impact our business by interfering with the availability of raw materials or our ability to obtain merchandise from foreign manufacturers.
Furthermore, the existence or threat of any other unforeseen interruption of commerce, including as a result of geopolitical or armed conflict and the possible interference with international trade, supplier deliveries, freight costs, or tariffs, could negatively impact our business by interfering with the availability of raw materials or our ability to obtain merchandise from foreign manufacturers.
During the second quarter of 2023, to drive ongoing brand growth and leverage the knowledge and experience of its regional teams, the company reorganized its structure and now primarily manages its business on a geographic basis, consisting of three reportable segments: Americas; Europe; the Middle East and Africa (EMEA) and Asia-Pacific (APAC).
During the second quarter of Fiscal 2023, to drive ongoing brand growth and leverage the knowledge and experience of its regional teams, the Company reorganized its structure and now primarily manages its business on a geographic basis, consisting of three reportable segments: Americas; Europe; the Middle East and Africa (EMEA) and Asia-Pacific (APAC).
For example, the recent attacks on cargo vessels in the Red Sea have resulted in delayed deliveries and may result in increased freight costs, and a prolonged or escalating armed conflict may result in additional costs, including any impact from using air freight instead of ocean freight to mitigate inventory delays.
For example, the attacks on cargo vessels in the Red Sea have resulted in delayed deliveries and increased freight costs, and a prolonged or escalating armed conflict may result in additional costs, including any impact from using air freight instead of ocean freight to mitigate inventory delays.
The retail industry in particular has been the target of many cyber-attacks and it is possible that an individual or group could defeat our security measures, or those of a third-party service provider, and access confidential information about our business, customers and associates.
The retail industry in particular has been the target of many cyber-attacks and it is possible that an individual or group could defeat our security measures, or those of a third-party service provider or business partner, and access confidential information about our business, customers and associates.
In order to compete in this highly competitive and constantly evolving industry, at times, we may launch new concepts or brands to expand our portfolio, or we may also enter into strategic partnerships with third parties to expand our global brand reach.
In order to compete in this highly competitive and constantly evolving industry, at times, we may enter into new strategic partnerships with third parties to expand our global brand reach, or we may launch new concepts or brands to expand our portfolio.
We face a variety of challenges in the highly competitive and constantly evolving retail industry, including: • Anticipating and responding to changing consumer shopping preferences more quickly than our competitors; • Maintaining favorable brand recognition; • Effectively marketing our products to consumers across diverse demographic markets, including through social media platforms which have become increasingly important in order to stay connected to our customers, as our digital sales penetration has increased.
We face a variety of challenges in the highly competitive and constantly evolving retail industry, including: • Anticipating and responding to changing consumer shopping preferences more quickly than our competitors; • Maintaining favorable brand recognition; • Effectively marketing our products to consumers across varying demographic markets, including through social media platforms which have become increasingly important in order to stay connected to our customers, as our digital sales penetration has increased.
Such risks include, but are not limited to, the following: • addressing the different operational requirements present in each country in which we operate, including those related to employment and labor, transportation, logistics, real estate, lease provisions and local reporting or legal requirements; • supporting global growth by successfully implementing local customer and product-facing teams and certain corporate support functions at our regional headquarters located in Shanghai, China and London, United Kingdom; • supporting global growth by decentralizing execution of our commercial strategy authority from our global home office to our regional headquarters located in Shanghai, China and London, United Kingdom; • hiring, training and retaining qualified personnel; • maintaining good labor relations with individual associates and groups of associates; • avoiding work stoppages or other labor-related issues in our European stores, where some associates are represented by workers’ councils and unions; • retaining acceptance from local customers; • managing inventory effectively to meet the needs of existing stores on a timely basis; • political, civil and social unrest, such as the conflicts between Russia and Ukraine or Israel and Hamas and conflict in the surrounding areas; • government regulations affecting trade between the U.S. and other countries, including tariffs and customs laws; • tax rate volatility and our ability to realize tax benefits resulting from non-U.S. operations; • managing foreign currency exchange rate risks effectively; • substantial investments of time and resources in our global operations may not result in achievement of acceptable levels of returns; for example, we recently have experienced year-over-year declines in revenues from our global operations; and • continued and sustained declines in our global revenues could lead to store closures, restructuring costs, and impairment losses, all of which could adversely impact our business, profitability, and results of operations.
Such risks include, but are not limited to, the following: • addressing the different operational requirements present in each country in which we operate, including those related to employment and labor, transportation, logistics, real estate, lease provisions and local reporting or legal requirements; • supporting global growth by successfully implementing local customer and product-facing teams and certain corporate support functions at our regional headquarters located in Shanghai, China and London, United Kingdom; • supporting global growth by decentralizing execution of our commercial strategy authority from our global home office to our regional headquarters located in Shanghai, China and London, United Kingdom; • hiring, training and retaining qualified personnel; • maintaining good labor relations with individual associates and groups of associates; • avoiding work stoppages or other labor-related issues in our European stores, where some associates are represented by workers’ councils and unions; • retaining acceptance from local customers; • managing inventory effectively to meet the needs of existing stores on a timely basis; • political, civil and social unrest, such as the conflict between Russia and Ukraine or conflict in the Middle East; • government regulations affecting trade between the U.S. and other countries, including tariffs and customs laws; • tax rate volatility and our ability to realize tax benefits resulting from non-U.S. operations; • managing foreign currency exchange rate risks effectively; • substantial investments of time and resources in our global operations may not result in achievement of acceptable levels of returns; for example, we have experienced year-over-year declines in revenues from our global operations; and • continued and sustained declines in our global revenues could lead to store closures, restructuring costs, and impairment losses, all of which could adversely impact our business, profitability, and results of operations.
If any of our overseas operations, or our associates or agents, violate such laws, we could become subject to sanctions or other penalties that could negatively affect our reputation, business and operating results. Our failure to appropriately address Environmental, Social, and Governance (ESG) matters could have a material adverse impact on our reputation and, as a result, our business.
If any of our overseas operations, or our associates or agents, violate such laws, we could become subject to sanctions or other penalties that could negatively affect our reputation, business and operating results. Our failure to appropriately address environmental, social, and governance (ESG) topics could have a material adverse impact on our reputation and, as a result, our business.
In addition, we cannot guarantee that we will be able to find adequate temporary or seasonal personnel to staff our operations when needed. For example, as automation, artificial intelligence and similar technological advancements continue to evolve, we may need to compete for talent that is familiar with these advancements in technologies in order to compete effectively with our industry peers.
In addition, we cannot guarantee that we will be able to find adequate temporary or seasonal personnel to staff our operations when needed. For example, as automation, AI and similar technological advancements continue to evolve, we may need to compete for talent that is familiar with these advancements in technologies in order to compete effectively with our industry peers.
The sale of apparel, personal care products and accessories for men, women and kids is a highly competitive business with numerous participants, including individual and chain specialty apparel retailers, local, regional, national and global department stores, discount stores and online-exclusive businesses.
The sale of apparel, personal care products and accessories for men, women and kids is a highly competitive business with numerous participants, including individual and chain specialty apparel retailers, local, regional, national and global department stores, discount stores, digitally-native brands, and online-exclusive businesses.
Our failure to optimize our global store network could have a material adverse impact on our business. With the evolution of digital and omnichannel capabilities, customer expectations have shifted and there has been greater pressure for a seamless omnichannel experience across all channels.
Our failure to evaluate and manage our global store network could have a material adverse impact on our business. With the evolution of digital and omnichannel capabilities, customer expectations have shifted and there has been greater pressure for a seamless omnichannel experience across all channels.
Despite efforts to prevent such an occurrence, our information technology systems may be vulnerable, from time to time, to damage or interruption from computer viruses, power interruptions or outages or other system failures, third-party intrusions, inadvertent or intentional breaches by our associates or third-party service providers, and other technical malfunctions.
Despite efforts to prevent such an occurrence, our information technology systems may be vulnerable, from time to time, to damage or interruption from computer viruses, power interruptions or outages or other system failures, third-party intrusions, inadvertent or intentional breaches by our associates, third-party service providers or business partners, or threat actors, and other technical malfunctions.
If we, or a third-party partner, were to fall victim to a successful cyber-attack or suffer intentional or unintentional data and security breaches by associates or third-parties, it could have a material adverse impact on our business, especially an event that compromises customer data or results in the unauthorized release of confidential business or customer information.
If we, or a third-party who has access to our info, were to fall victim to a successful cyber-attack or suffer intentional or unintentional data and security breaches by associates or third-parties, it could have a material adverse impact on our business, especially an event that compromises customer data or results in the unauthorized release of confidential business or customer information.
Our business is subject to factors that are impacted by worldwide economic conditions, including heightened inflation levels (which has occurred), unemployment levels, consumer credit availability, consumer debt levels, reductions in consumer net worth based on declines in the financial, residential real estate and mortgage markets, bank failures, sales and personal income tax rates, fuel and energy prices, global food supplies, interest rates, consumer confidence in future economic and political conditions, consumer perceptions of personal well-being and security, the value of the U.S. dollar versus foreign currencies, geopolitical conflicts, and other macroeconomic factors.
Our business is subject to factors that are impacted by worldwide economic conditions, including heightened inflation levels (which has occurred), unemployment levels, consumer credit availability, consumer debt levels, reductions in consumer net worth based on declines in the financial, residential real estate and mortgage markets, bank failures, sales and personal income tax rates, fuel and energy prices, global food supplies, rising or uncertain interest rates, new increased tariffs, trade disputes, consumer confidence in future economic and political conditions, consumer perceptions of personal well-being and security, the value of the U.S. dollar versus foreign currencies, geopolitical conflicts, and other macroeconomic factors.
Such partnerships may include wholesale, franchise, licensing arrangements in which we license our brands and intellectual property for use on products produced and marketed by third parties, and licensing arrangements in which we license intellectual property from third parties.
Such strategic partnerships may include wholesale, franchise, or licensing arrangements in which we license our brands and intellectual property for use on products produced, marketed and/or sold by third parties, and licensing arrangements in which we license intellectual property from third parties.
Proliferation of the digital channel within the last few years has encouraged the entry of many new competitors and an increase in competition from established companies. These increases in competition could reduce our ability to retain and grow sales, resulting in an adverse impact to our operating results and business.
Proliferation of the digital channel has encouraged the entry of many new competitors and an increase in competition from established companies. These increases in competition could reduce our ability to retain and grow sales, resulting in an adverse impact to our operating results and business.
Further, the sophistication, availability and use of artificial intelligence by threat actors present an increased level of risk. If our systems are damaged, fail to function properly, or are obsolete in comparison to those of our competition, we may have to make monetary investments to repairs or replace the systems and we could endure delays in our operations.
Further, the sophistication, availability and use of AI by threat actors present an increased level of risk. If our systems are damaged, fail to function properly, or are outdated in comparison to those of our competition, we may have to make monetary investments to repairs or replace the systems and we could endure delays in our operations.
Our ability to maintain our reputation is critical and public perception about our products or operations, whether justified or not, could impair our reputation, involve us in litigation, damage our brands and have a material adverse impact on our business.
OPERATIONAL RISKS. Failure to protect our reputation could have a material adverse impact on our business. Our ability to maintain our reputation is critical and public perception about our products or operations, whether justified or not, could impair our reputation, involve us in litigation, damage our brands and have a material adverse impact on our business.
In addition, in recent years there has been an increase in media platforms, particularly, social media and our use of social media platforms is an important element of our omnichannel marketing efforts. For example, we maintain various social media accounts for our brands, including Instagram, TikTok, Facebook, Twitter and Pinterest accounts.
In addition, in recent years there has been an increase in media platforms, particularly, social media and our use of social media platforms is an important element of our omnichannel marketing efforts. For example, we maintain various social media accounts for our brands, including Instagram, TikTok, Facebook, X (f/k/a Twitter), SnapChat, and Pinterest accounts.
Our sales at these stores, as well as sales at our flagship locations, are partially dependent upon the volume of traffic in those shopping centers and the surrounding area which, for some centers, has been in decline.
Our sales at these stores are partially dependent upon the volume of traffic in those shopping centers and the surrounding area which, for some centers, has been in decline.
Events that could jeopardize our reputation, include, but are not limited to, the following: • We fail to maintain high standards for merchandise quality and integrity; • We fall victim to a cyber-attack, resulting in customer data being compromised; • We fail to comply with ethical, social, product, labor, health and safety, legal, accounting or environmental standards, or related political considerations; • Third parties with which we have a business relationship, including our brand representatives and influencer network, and our wholesale, franchise licensing, or marketplace partners, fail to represent our brands in a manner consistent with our brand image or act in a way that harms their reputation; • Third-party vendors fail to comply with our Vendor Code of Conduct or any third parties with which we have a business relationship fail to represent our brands in a manner consistent with our brand image; • Unfavorable media publicity and consumer perception of our products, operations, brand or experience; and • Our position or perceived lack of position on ESG, public policy or other similar issues and any perceived lack of transparency about those matters.
Events that could jeopardize our reputation, include, but are not limited to, the following: • We fail to maintain high standards for merchandise quality and integrity; • We fall victim to a cyber-attack, resulting in customer data being compromised; • We fail to comply with ethical, social, product, labor, health and safety, legal, accounting or environmental standards, or related political considerations; • Third parties with which we have a business relationship, including our brand representatives and influencer network, and our wholesale, franchise licensing, or marketplace partners, fail to represent our brands in a manner consistent with our brand image or act in a way that harms their reputation; • Misconduct or illegal activities by our current and former associates, directors, advisors, third-party business partners, or others affiliated, or perceived to be affiliated, with the Company; • Third-party vendors fail to comply with our Vendor Code of Conduct or any third parties with which we have a business relationship fail to represent our brands in a manner consistent with our brand image; • Unfavorable media publicity, influencer reviews on social media, or negative consumer perception of our products, operations, brand or experience; and • Our position or perceived lack of position on ESG topics, public policy or other similar issues and any perceived lack of transparency about those matters.
We cannot control the loss of a significant tenant in a shopping mall or area attraction, the development of new shopping malls in the U.S. or around the world, the availability or cost of appropriate locations or the success of individual shopping malls and there is competition with other retailers for prominent locations.
We cannot control the loss of a significant tenant in a shopping mall or area attraction, the development of new shopping malls in the U.S. or around the world, the availability or cost of appropriate locations, the success of individual shopping malls, or the increasing impact of digital channels on shopping mall traffic and there is competition with other retailers for prominent locations.
We have experienced, and expect to continue to experience, increased costs associated with protecting confidential information through the implementation of security technologies, processes and procedures, including training programs for associates to raise awareness about phishing, malware and other cyber risks, especially as we implement new technologies, such as new payment capabilities or updates to our mobile apps and websites.
Abercrombie & Fitch Co. 18 2024 Form 10-K Table of Contents We have experienced, and expect to continue to experience, increased costs associated with protecting confidential information through the implementation of security technologies, processes and procedures, including training programs for associates to raise awareness about phishing, malware and other cyber risks, especially as we implement new technologies, such as new payment capabilities or updates to our mobile apps and websites.
Our retail stores, corporate offices, distribution centers, infrastructure projects and digital operations, as well as the operations of our vendors and manufacturers, are vulnerable to disruption from natural disasters, such as hurricanes, tornadoes, floods, earthquakes, extreme cold events and other adverse weather events; negative climate patterns, such as those in domestic and global water-stressed regions; public health crises, such as pandemics and epidemics; political crises, such as terrorists attacks, war, labor, unrest and other political instability; significant power interruptions or outages; and other unexpected, catastrophic events.
Our retail stores, corporate offices, distribution centers, infrastructure projects and digital operations, as well as the operations of our vendors and manufacturers, are vulnerable to disruption from natural disasters, such as hurricanes, tornadoes, floods, earthquakes, extreme cold events, unseasonably warm weather, and other adverse weather events; negative climate patterns, such as those in domestic and global water-stressed regions; public health crises, such as pandemics and epidemics; political crises, such as terrorists attacks, war, geopolitical uncertainty, labor, unrest, and other political instability (including, without limitation, the ongoing conflict between Russia and Ukraine and the conflict in the Middle East); significant power interruptions or outages; and other unexpected, catastrophic events.
There is an increased focus from certain government regulators, investors, customers, associates, business partners and other stakeholders concerning ESG matters. The expectations related to ESG matters are rapidly evolving.
There is increased focus from certain government regulators, investors, customers, associates, business partners and other stakeholders concerning ESG matters. The expectations related to ESG matters continue to rapidly evolve and diverge.
As a result, the continued success of our operations is tied to our timely receipt of quality merchandise from third-party manufacturers. We source the majority of our merchandise outside of the U.S. through arrangements with approximately 130 vendors, primarily located in southeast Asia.
We depend on third parties for the manufacture and delivery of our merchandise. As a result, the continued success of our operations is tied to our timely receipt of quality merchandise from third-party manufacturers. We source the majority of our merchandise outside of the U.S. through arrangements with approximately 150 vendors, primarily located in southeast Asia.
Certain events, such as the conflicts between Russia and Ukraine or Israel and Hamas and the surrounding areas, uncertainty with respect to trade policies, tariffs and government regulations and actions affecting trade between the U.S. and other countries, have increased global economic and political uncertainty in recent years and could result in volatility of foreign currency exchange rates as these events develop.
Certain events could cause uncertainty with respect to trade policies, tariffs and government regulations and actions affecting trade between the U.S. and other countries, have increased global economic and political uncertainty in recent years and could result in volatility of foreign currency exchange rates as these events develop.
Fluctuations in the cost of transportation could also have a material adverse effect on our cost of sales and ability to meet customer demand. We primarily use six contract carriers to ship merchandise and related materials to our North American customers, and several contract carriers for our global customers.
Abercrombie & Fitch Co. 19 2024 Form 10-K Table of Contents Fluctuations in the cost of transportation could also have a material adverse effect on our cost of sales and ability to meet customer demand. We primarily use six contract carriers to ship merchandise and related materials to our North American customers, and several contract carriers for our global customers.
This reliance on third parties makes our operations vulnerable to a failure by any one of these parties to perform adequately or maintain effective internal controls. We regularly evaluate our information technology systems and requirements to ensure appropriate functionality and use in response to business demands.
This reliance on third parties makes our operations vulnerable to a failure by any one of these parties to perform adequately or maintain effective internal controls. We regularly evaluate our information technology systems and requirements to ensure appropriate functionality and use in response to business demands. For example, in 2022, we began the multi-year process of upgrading our ERP system.
Such investments and operational changes include the development of localized fulfillment, shipping and customer service operations, investments in digital media to attract new customers, and the rollout of omnichannel capabilities listed in “ ITEM 1.
Such investments and operational changes include the development of localized fulfillment, shipping and customer service operations, investments in digital media to attract new customers, and the rollout of omnichannel capabilities listed in “ ITEM 1. BUSINESS ” of this Annual Report on Form 10-K.
In addition, to the extent natural disasters cause physical losses to our stores, distribution centers or offices, we may incur costs that exceed our applicable insurance coverage for any necessary repairs to damages or business disruption. Abercrombie & Fitch Co. 15 2023 Form 10-K Table of Contents STRATEGIC RISKS. Our failure to successfully execute on our 2025 Always Forward Plan.
In addition, to the extent natural disasters cause physical losses to our stores, distribution centers or offices, we may incur costs that exceed our applicable insurance coverage for any necessary repairs to damages or business disruption. Abercrombie & Fitch Co. 14 2024 Form 10-K Table of Contents STRATEGIC RISKS.
Further events of this nature, domestic or abroad, including international and domestic unrest and the ongoing conflicts between Russia and Ukraine or Israel and Hamas and the surrounding areas, may disrupt commerce and undermine consumer confidence and consumer spending by causing a decline in traffic, store closures and a decrease in digital demand adversely affecting our operating results.
Further events of this nature, domestic or abroad, including international and domestic unrest, may disrupt commerce and undermine consumer confidence and consumer spending by causing a decline in traffic, store closures and a decrease in digital demand adversely affecting our operating results.
As a result, global store network optimization is an important part of our business and failure to optimize our global store network could have an adverse impact on our results of operations. The ability to modify existing leases, to remodel or repurpose existing locations, and to open new stores experiences requires partnership with our landlords.
Modernizing and growing our store fleet is an important part of our business strategy and failure to evaluate and manage our global store network could have an adverse impact on our results of operations. The ability to modify existing leases, to remodel or repurpose existing locations, and to open new stores experiences requires partnership with our landlords.
Because we may enter into agreements for the manufacture and purchase of merchandise well in advance of the applicable selling season, we are vulnerable to changes in consumer preferences and demand, pricing shifts, and the sub-optimal selection and timing of merchandise purchases.
Because we may enter into agreements for the manufacture and purchase of merchandise well in advance of the applicable selling season, we are vulnerable to changes in consumer preferences and demand, pricing shifts, and the sub-optimal selection and timing of merchandise purchases. We expect continuously changing fashion-related trends and consumer tastes to influence future demand for our products.
Our failure to realize the anticipated objectives or sustain the financial objectives, which may be due to our inability to execute on the various elements of our 2025 Always Forward Plan, changes in consumer demand, competition, macroeconomic conditions (including inflation), retention of key talent, and other risks described herein, could have a material adverse effect on our business.
Our failure to realize the anticipated objectives or sustain the financial objectives established in our long-term strategic plans, which may be due to our inability to execute established long-term target or goals, changes in consumer demand, competition, macroeconomic conditions (including inflation or tariffs), retention of key talent, and other risks described herein, could have a material adverse effect on our business.
BUSINESS .” While we must keep up to date with technology trends in the retail environment in order to manage our successful omnichannel shopping experience, it is possible these initiatives may not provide the anticipated benefits or desired rates of return.
Abercrombie & Fitch Co. 17 2024 Form 10-K Table of Contents While we must keep up to date with technology trends in the retail environment in order to manage our successful omnichannel shopping experience, it is possible these initiatives may not provide the anticipated benefits or desired rates of return.
If we announce certain initiatives and goals, related to ESG matters, such as those through our participation in the United Nations Global Compact, we could fail, or be perceived to fail, to accurately set, meet or accurately report our progress on such initiatives and goals. We could fail, or be perceived to fail, to act responsibly in our ESG efforts.
Furthermore, if we announce certain initiatives and goals related to ESG matters we could fail, or be perceived to fail, to accurately set, meet or report our progress on such initiatives and goals and/or we could fail, or be perceived to fail, to act responsibly in our ESG efforts.
We believe that our 2025 Always Forward Plan will lead to long-term revenue growth and profitability, however, there is no assurance regarding the extent to which we will realize the anticipated objectives or sustain the financial objectives, if at all, or regarding the timing of such anticipated benefits.
While we believe that our successful execution and ability to attain certain established goals and targets of our Always Forward Plan led to long-term revenue growth and profitability, there is no assurance regarding the extent to which we will realize the anticipated objectives or sustain the financial objectives, if at all, or regarding the timing of such anticipated benefits.
Abercrombie & Fitch Co. 14 2023 Form 10-K Table of Contents Our ability to attract customers to our stores depends, in part, on the success of the shopping malls or area attractions that our stores are located in or around. Our stores are primarily located in shopping malls and other shopping centers.
Our ability to attract customers to our stores depends, in part, on the success of the shopping malls or area attractions that our stores are located in or around. Our stores are primarily located in shopping malls and other shopping centers.
BUSINESS .” While we have successfully executed certain goals in our 2025 Always Forward Plan, our continued ability to effectively execute on and maintain the results of our 2025 Always Forward Plan is subject to various risks and uncertainties as described herein.
While we have successfully executed certain goals in our Always Forward Plan, our continued ability to effectively execute on and maintain the results of our Always Forward Plan is subject to various risks and uncertainties as described herein. In addition, we may modify or adjust future long-term strategies to meet changes in our business environment.
There is also uncertainty regarding the implementation of laws, regulations, and policies related to ESG and global environmental sustainability matters, including disclosure obligations and reporting on such matters, and appropriately responding to potentially competing and/or contradictory regulatory requirements and expectations in the jurisdictions in which we operate.
This may also impact our ability to attract and retain talent to compete in the marketplace Abercrombie & Fitch Co. 16 2024 Form 10-K Table of Contents There is also uncertainty regarding the implementation of laws, regulations, and policies related to ESG and global environmental sustainability matters, including disclosure obligations and reporting on such matters, and appropriately responding to potentially competing and/or contradictory regulatory requirements and expectations in the jurisdictions in which we operate.
Abercrombie & Fitch Co. 18 2023 Form 10-K Table of Contents If our information technology systems are disrupted or cease to operate effectively, it could have a material adverse impact on our business.
If our information technology systems are disrupted or cease to operate effectively, it could have a material adverse impact on our business.
Increased global uncertainty has also impacted and may in the future impact the cost, availability and quality of the fabrics or other raw materials used to manufacture our merchandise, and compliance with sanctions, customs trade orders and sourcing laws, such as those issued by the U.S. government related to the ongoing conflict in Russia and Ukraine and entities and individuals connected to China’s Xinjiang Uyghur Autonomous Region, could impact the price of cotton in the marketplace and the global supply chain.
Increased global uncertainty has also impacted and may in the future impact the cost, availability and quality of the fabrics or other raw materials used to manufacture our merchandise, and compliance with sanctions, customs trade orders and sourcing laws could impact the price of cotton in the marketplace and the global supply chain.
Refer to “ ITEM 1. BUSINESS ,” for a listing of certain distribution centers on which we rely. We rely on the experience and skills of our executive officers and associates, and the failure to attract or retain this talent, effectively manage succession, and establish a diverse workforce could have a material adverse impact on our business.
We rely on the experience and skills of our executive officers and associates, and the failure to attract or retain this talent, effectively manage succession, and establish a workforce that can best serve the communities in which we operate could have a material adverse impact on our business.
We may not be able to pass all or a portion of higher labor costs on to our customers, which could adversely affect our gross margin and results of operations.
We may not be able to pass all or a portion of higher labor costs on to our customers, which could adversely affect our gross margin and results of operations. Changes in tax or tariff policy regarding merchandise produced in, and raw materials sourced from, certain countries could adversely affect our business.
If the continued execution and maintenance of our 2025 Always Forward Plan is not successful, or we do not realize the full objectives to the extent or in the timeline that we anticipate, our financial condition and reputation could be adversely affected. Our failure to attract, retain, and effectively manage strategic partnerships with third parties.
If the continued execution and maintenance of our long-term business strategy is not successful, or we do not realize the full objectives to the extent or in the timeline that we anticipate, our financial condition and reputation could be adversely affected.
Our distribution center operations are susceptible to local and regional factors, such as system failures, accidents, labor disputes, economic and weather conditions, natural disasters, significant power interruptions or outages, demographic and population changes, and other unforeseen events and circumstances. We rely on both company-operated and third-party distribution centers to manage the receipt, storage, sorting, packing and distribution of our merchandise.
Our reliance on our distribution centers makes us susceptible to disruptions or adverse conditions affecting our supply chain. Our distribution center operations are susceptible to local and regional factors, such as system failures, accidents, labor disputes, economic and weather conditions, natural disasters, significant power interruptions or outages, demographic and population changes, and other unforeseen events and circumstances.
Other events that could disrupt the timely delivery of our merchandise include new trade law provisions or regulations, reliance on a limited number of shipping carriers and associated alliances, weather events, significant labor disputes, port congestion and other unexpected events. Our reliance on our distribution centers makes us susceptible to disruptions or adverse conditions affecting our supply chain.
Abercrombie & Fitch Co. 20 2024 Form 10-K Table of Contents Other events that could disrupt the timely delivery of our merchandise include new trade law provisions or regulations, reliance on a limited number of shipping carriers and associated alliances, weather events, significant labor disputes, port congestion and other unexpected events.
Moreover, there can be no assurance that we will continue to anticipate consumer demands and macroeconomic events or to be successful in accurately planning inventory in the future. Changing consumer preferences and fashion trends, and our ability to anticipate, identify and swiftly respond to them, could adversely impact our sales.
Changes in consumer tastes, fashion trends and brand reputation can have an impact on our financial performance. Moreover, there can be no assurance that we will continue to anticipate consumer demands and macroeconomic events or to be successful in accurately planning inventory in the future.
Inventory levels for certain merchandise styles no longer considered to be “on trend” may increase, leading to higher markdowns to sell through excess inventory and, therefore, lower than planned margins.
Changing consumer preferences, spending patterns, and fashion trends, and our ability to anticipate, identify and swiftly respond to them, could adversely impact our sales. Inventory levels for certain merchandise styles no longer considered to be “on trend” may increase, leading to higher markdowns to sell through excess inventory and, therefore, lower than planned margins.
We may incur significant costs related to compliance with these laws and failure to comply with these regulatory standards, and others, could have a material adverse impact on our business.
We may incur significant costs related to compliance with these laws and failure to comply with these regulatory standards, and others, could have a material adverse impact on our business. We have also implemented a flexible work policy allowing most of our corporate associates to work remotely, from time to time, as have certain of our third-party vendors.
We could also be subjected to negative responses by governmental actors (such as anti-ESG legislation or retaliatory legislative treatment) or consumers (such as boycotts or negative publicity campaigns) that could adversely affect our reputation, results of operations, financial condition and cash flows.
We may not be able to meet the diverging expectations and perspectives on these topics, and we could be subjected to negative responses by consumers (such as boycotts or negative publicity campaigns) that could adversely affect our reputation, results of operations, financial condition and cash flows.
Although we attempt to open new stores in prominent locations, it is possible that locations which were prominent when we opened our stores may lose favor over time. Our failure to realize the anticipated benefits of our recent transition to a regional-based organizational model could have a negative impact on our business.
Although we attempt to open new stores in prominent locations, it is possible that locations which were prominent when we opened our stores may lose favor over time.
For example, changes in inventory purchase assumptions have resulted in changes in the effectiveness to certain of our hedging instruments, and we could see similar impacts in future periods. Fluctuations in foreign currency exchange rates could adversely impact consumer spending, delay or prevent successful penetration into new markets or adversely affect the profitability of our global operations.
For example, changes in inventory purchase assumptions have resulted in changes in the effectiveness to certain of our hedging instruments, and we could see similar impacts in future periods.
Abercrombie & Fitch Co. 16 2023 Form 10-K Table of Contents Our inability to effectively conduct business in global markets, including as a result of legal, tax, regulatory, political and economic risks could have a material adverse impact on our business.
In addition, realization of the anticipated benefits of this new regional-based organizational model is dependent on the effectiveness of this new operating structure. Our inability to effectively conduct business in global markets, including as a result of legal, tax, regulatory, political and economic risks could have a material adverse impact on our business.
Abercrombie & Fitch Co. 20 2023 Form 10-K Table of Contents We depend upon independent third parties for the manufacture and delivery of all our merchandise, and a disruption of the manufacture or delivery of our merchandise could have a material adverse impact on our business. We do not own or operate any manufacturing facilities.
These risks could adversely affect our revenues, reduce our profitability, and negatively impact our business. We depend upon independent third parties for the manufacture and delivery of our merchandise, and a disruption of the manufacture or delivery of our merchandise could have a material adverse impact on our business.
For example, in 2022 we started a multi-year process of upgrading our merchandising enterprise resource planning ("ERP") system. We are aware of the inherent risks associated with replacing and modifying these systems, including inaccurate system information, system disruptions and user acceptance and understanding.
We are continuing to execute this plan in Fiscal 2025 and currently anticipate implementation in Fiscal 2026. We are aware of the inherent risks associated with replacing and modifying these systems, including system disruptions, inaccurate system information, and user acceptance and understanding.
This may also impact our ability to attract and retain talent to compete in the marketplace. In addition, we could be criticized by ESG detractors for the scope or nature of our ESG initiatives or goals or for any revisions to these goals.
In addition, in recent years there has been a rise in the prevalence of the anti-ESG movement, and we could be criticized for the scope or nature of our ESG initiatives and goals or for any revisions to our goals.
Abercrombie & Fitch Co. 17 2023 Form 10-K Table of Contents OPERATIONAL RISKS. Failure to protect our reputation could have a material adverse impact on our business.
Abercrombie & Fitch Co. 15 2024 Form 10-K Table of Contents Our failure to realize the anticipated benefits of our recent transition to a regional-based organizational model could have a negative impact on our business.
Removed
In 2022 we introduced our 2025 Always Forward Plan as our long-term strategic plan, as described in “ ITEM 1.
Added
Abercrombie & Fitch Co. 13 2024 Form 10-K Table of Contents Fluctuations in foreign currency exchange rates could adversely impact consumer spending, delay or prevent successful penetration into new markets or adversely affect the profitability of our global operations.
Removed
In addition, realization of the anticipated benefits of this new regional-based organizational model is dependent on the effectiveness of this new operating structure.
Added
Changes to our long-term business strategy or a failure to successfully execute on our long-term strategic plans could adversely impact our financial condition and reputation.
Removed
Abercrombie & Fitch Co. 19 2023 Form 10-K Table of Contents We have also implemented a flexible work policy allowing most of our corporate associates to work remotely, from time to time, as have certain of our third-party vendors.
Added
Our failure to attract, retain, and effectively manage strategic partnerships with third parties could have a material adverse impact on our business.
Added
Through our multi-year global store network optimization initiative, we have taken actions to optimize our store productivity by remodeling, right-sizing or relocating stores to smaller square footage locations, and closing legacy stores.
Added
A predominant portion of the merchandise we sell is originally manufactured in countries other than the United States. Refer to Note 6, “ INVENTORIES ,” of the Notes to Consolidated Financial Statements included in “ITEM 8.
Added
FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA” of this Annual Report on Form 10-K for a summary of inventory sourced based on vendor location during Fiscal 2024. Additionally, many of the raw materials used to manufacture our apparel is sourced internationally.
Added
International trade disputes that result in tariffs and other protectionist measures could adversely affect our business, including disruption and cost increases in our established patterns for sourcing raw materials and our merchandise and increased uncertainties in planning our sourcing strategies and forecasting our margins.
Added
For example, the United States has imposed significant new tariffs on China related to the importation of certain product categories. It is also possible that additional tariffs may be imposed on imports from other countries, including the foreign countries where our apparel is predominantly manufactured.
Added
The imposition of any such tariffs would likely increase the cost of our merchandise and negatively impact our operating results. Although such changes would have implications across the entire industry, we may fail to effectively adapt to and manage the adjustments in strategy that would be necessary in response to those changes.
Added
We are working with our current suppliers to mitigate our exposure to current or potential tariffs and seeking opportunities to engage other suppliers, but there can be no assurance that we will be able to offset any increased costs or secure other suppliers.
Added
In addition, other countries may change their business and trade policies in anticipation of or in response to the U.S.’s increased import tariffs and other changes in U.S. trade policy and regulations already enacted or that may be enacted in the future.
Added
In addition to the general uncertainty and overall risk from potential changes in trade laws and policies, as we make business decisions in the face of such uncertainty, we may incorrectly anticipate the outcomes, miss out on business opportunities, or fail to effectively adapt our business strategies and manage the adjustments that are necessary in response to those changes.
Added
We rely on both company-operated and third-party distribution centers to manage the receipt, storage, sorting, packing and distribution of our merchandise.
Added
Refer to “ ITEM 1. BUSINESS ” of this Annual Report on Form 10-K, for a listing of certain distribution centers on which we rely.

Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

12 edited+0 added−2 removed9 unchanged
Biggest changeThe Company implements and maintains a set of controls to manage information risk, establishes guidelines for the use of information technology, and defines standards for identifying and mitigating information risks, considering controls from multiple security frameworks, such as the Center for Internet Security’s Critical Security Control and the Payment Card Industry Data Security Standard.
Biggest changeThe controls are developed based on risk assessments and a review of controls from multiple security frameworks, such as the Center for Internet Security’s Critical Security Control and the Payment Card Industry Data Security Standard. The Company, internally and through third parties, conducts multiple information risk assessments each year.
Although the risks from cybersecurity threats have not materially affected our business strategy, results of operations, or financial condition to date, they may in the future and we continue to closely monitor cyber risk. See ITEM 1A. RISK FACTORS for additional information regarding the Company’s cybersecurity risks and which should be read in conjunction with this Item 1C.
Although the risks from cybersecurity threats have not materially affected our business strategy, results of operations, or financial condition to date, they may in the future and we continue to closely monitor cyber risk. See “ ITEM 1A. RISK FACTORS ” for additional information regarding the Company’s cybersecurity risks and which should be read in conjunction with this Item 1C.
The Company leverages third-party security firms in different capacities to implement or operate various aspects of the Company’s information security program, including to conduct risk assessments and penetration testing.
The Company leverages third-party security firms in different capacities to implement or operate various aspects of the Company’s information assets and information security program, including to conduct risk assessments and penetration testing.
To effectively manage oversight of our cybersecurity risk management practices, since 2019 the Board has delegated such responsibility to the Company’s Audit and Finance Committee.
To manage oversight of our cybersecurity risk management practices, since 2019 the Board has delegated such responsibility to the Company’s Audit and Finance Committee.
The Company’s information security program is established at the executive level, with regular reporting to, and oversight by, the Company’s Board of Directors (the “Board”) as described below. At the highest level, the Company’s program includes multi-layered governance by management, the Audit and Finance Committee of the Board and the Board, as described in greater detail below.
The Company’s information security program is managed at the executive level, with regular reporting to, and oversight by, the Board as described below. The Company’s program includes multi-layered governance by management, the Audit and Finance Committee of the Board and the Board, as described in greater detail below.
The CISO has approximately two decades of experience in technology risk management, including over a decade with the Company, and has passed examinations and received certifications as a SANS Global Information Security Leader and a Certified Information Systems Auditor.
The CISO has approximately two decades of experience in technology risk management, including over a decade with the Company, and has passed examinations and received certifications as a SANS Global Information Security Leader and a Certified Information Systems Auditor. The CISO reports directly to the Company’s Chief Digital and Technology Officer.
The Company uses a variety of processes to address cybersecurity threats related to the use of third-party technology and services, such as conducting risk assessments of third-party vendors where the Company has determined it to be appropriate.
The Company uses a variety of processes to address cybersecurity threats associated with third parties, including our use of third-party technology and services, such as conducting risk assessments and reviewing contractual requirements where the Company has determined it to be appropriate.
Information Security processes include escalation of certain risks and incidents, including those that originate or occur at third parties, to the CISO and the executive team as appropriate based on the severity or potential severity.
The Company’s Information Security team, under the direction of the CISO, implements and provides governance and functional oversight for cybersecurity controls and services. Information Security processes include escalation of certain risks and incidents, including those that originate or occur at third parties, to the CISO and the executive team as appropriate based on the severity or potential severity.
At the executive and management level, the CISO has primary responsibility for the architecture, implementation, and management of the Company’s information security program.
Abercrombie & Fitch Co. 25 2024 Form 10-K Table of Contents At the executive and management level, the CISO has primary responsibility for the architecture, implementation, and management of the Company’s information security program.
The IRP includes certain steps to be taken by the Information Security team to, among other things, assess the severity of an incident, determine the appropriate escalation, and mitigate or remediate the incident.
In addition, the Company’s Incident Response Plan (“IRP”) provides an outline for the Company on how to identify and address a significant cybersecurity incident. The IRP includes certain steps to be taken by the Information Security team to, among other things, assess the severity of an incident, determine the appropriate escalation, and mitigate or remediate the incident.
The Company, internally and through third parties, conducts multiple information risk assessments each year. Risks identified in such assessments are considered for inclusion in the Company’s information risk portfolio and are then prioritized and addressed where appropriate through the Company’s broader information security programs.
Risks identified in such assessments are considered and evaluated for inclusion in the Company’s information risk portfolio and are then prioritized and addressed where appropriate to update the Company’s information security programs. Assessments, along with risk-based analysis and judgment, are used by the Company to determine how it should manage these risks.
The Company’s policies and procedures identify how cybersecurity measures and controls are developed, implemented, and regularly reviewed and updated.
The Company’s policies and procedures identify how cybersecurity measures and controls are developed, implemented, and regularly reviewed and updated. The Company implements and maintains a set of controls to manage information risk, establishes guidelines for the use of information technology, and defines standards for identifying and mitigating information risks.
Removed
Assessments along with risk-based analysis and judgment are used by the Company to determine what the Company believes to be the optimal way to manage these risks. In addition, the Company’s Incident Response Plan (“IRP”) provides an outline for the Company on how to identify and address a significant cybersecurity incident.
Removed
The CISO reports Abercrombie & Fitch Co. 26 2023 Form 10-K Table of Contents directly to the Company’s Chief Digital and Technology Officer. The Company’s Information Security team, under the direction of the CISO, implements and provides governance and functional oversight for cybersecurity controls and services.

Item 2. Properties

Properties — owned and leased real estate

1 edited+0 added−0 removed3 unchanged
Biggest changeAs of February 3, 2024, the Company operated 765 retail stores across its brands. The Company does not believe that any individual store lease is material; however, certain geographic areas may have a higher concentration of store locations.
Biggest changeAs of February 1, 2025, the Company operated 789 retail stores across its brands. The Company does not believe that any individual store lease is material; however, certain geographic areas may have a higher concentration of store locations.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

0 edited+1 added−1 removed9 unchanged
Removed
Item 3. Legal Proceedings The Company is a defendant in lawsuits and other adversary proceedings arising in the ordinary course of business.
Added
Item 3. Legal Proceedings The Company and its affiliates are parties to lawsuits and other adversary proceedings that may range from individual actions involving a single plaintiff to class action lawsuits.

Item 4. Mine Safety Disclosures

Mine Safety Disclosures — required of mining issuers

9 edited+4 added−1 removed1 unchanged
Biggest changeAbercrombie & Fitch Co. 28 2023 Form 10-K Table of Contents Equity Securities The following table provides information regarding the purchase of shares of Common Stock made by or on behalf of A&F or any “affiliated purchaser” as defined in Rule 10b-18(a)(3) under the Exchange Act during each fiscal month of the fourteen weeks ended February 3, 2024: Period (fiscal month) Total Number of Shares Purchased (1) Average Price Paid per Share Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (2) Maximum Number of Shares (or Approximate Dollar Value) that May Yet Be Purchased Under the Plans or Programs (3) October 29, 2023 through November 25, 2023 913 $ 69.80 — $ 232,184,768 November 26, 2023 through December 30, 2023 3,449 77.09 — 232,184,768 December 31, 2023 through February 3, 2024 635 109.47 — 232,184,768 Total 4,997 $ 79.87 — 232,184,768 (1) An aggregate of 4,997 shares of A&F’s Common Stock purchased during the fourteen weeks ended February 3, 2024 were withheld for tax payments due upon the vesting of employee restricted stock units and exercise of employee stock appreciation rights.
Biggest changeAbercrombie & Fitch Co. 27 2024 Form 10-K Table of Contents Equity Securities The following table provides information regarding the purchase of shares of Common Stock made by or on behalf of A&F or any “affiliated purchaser” as defined in Rule 10b-18(a)(3) under the Exchange Act during each fiscal month of the thirteen weeks ended February 1, 2025: Period (fiscal month) Total Number of Shares Purchased (1) Average Price Paid per Share Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (2) Maximum Number of Shares (or Approximate Dollar Value) that May Yet Be Purchased Under the Plans or Programs (3) November 3, 2024 through November 30, 2024 887 $ 144.64 — $ 102,378,203 December 1, 2024 through January 4, 2024 395,178 148.05 391,975 44,342,876 January 5, 2024 through February 1, 2025 300,172 139.80 300,172 2,378,213 Total 696,237 $ 144.49 692,147 2,378,213 (1) An aggregate of 4,090 shares of A&F’s Common Stock purchased during the thirteen weeks ended February 1, 2025 were withheld for tax payments due upon the vesting of employee restricted stock units.
Performance Graph The following graph shows the changes, over the five-year period ended February 3, 2024 (the last day of A&F’s Fiscal 2023) in the value of $100 invested in (i) shares of Common Stock; (ii) Standard & Poor’s 500 Stock Index (the “S&P 500”); and (iii) Standard & Poor’s Apparel Retail Composite Index (the “S&P Apparel Retail”), including reinvestment of dividends.
Performance Graph The following graph shows the changes, over the five-year period ended February 1, 2025 (the last day of A&F’s Fiscal 2024) in the value of $100 invested in (i) shares of Common Stock; (ii) Standard & Poor’s 500 Stock Index (the “S&P 500”); and (iii) Standard & Poor’s Apparel Retail Composite Index (the “S&P Apparel Retail”), including reinvestment of dividends.
(1) This performance graph shall not be deemed to be “soliciting material” or to be “filed” with the SEC or subject to Regulation 14A or to the liabilities of Section 18 of the Exchange Act, except to the extent that A&F specifically requests that the performance graph be treated as soliciting material or specifically incorporates it by reference into a filing under the Securities Act of 1933, as amended (the “Securities Act”), or the Exchange Act.
(1) This performance graph shall not be deemed to be “soliciting material” or to be “filed” with the SEC or subject to Regulation 14A or to the liabilities of Section 18 of the Exchange Act, except to the extent that A&F specifically requests that the performance graph be treated as soliciting material or specifically incorporates it by reference into a filing under the Securities Act or the Exchange Act.
Copyright© 2024 Standard & Poor’s, a division of S&P Global. All rights reserved.
Copyright© 2025 Standard & Poor’s, a division of S&P Global. All rights reserved.
However, when including investors holding shares of Common Stock in broker accounts under street name, A&F estimates that there were approximately 167,000 stockholders.
However, when including investors holding shares of Common Stock in broker accounts under street name, A&F estimates that there were approximately 215,300 stockholders.
Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Market Information and Holders A&F’s Class A Common Stock, $0.01 par value (“Common Stock”) is traded on the New York Stock Exchange under the symbol “ANF.” As of April 1, 2024, there were approximately 2,400 stockholders of record.
Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Market Information and Holders A&F’s Class A Common Stock, $0.01 par value (“Common Stock”) is traded on the New York Stock Exchange under the symbol “ANF.” As of March 31, 2025, there were approximately 2,200 stockholders of record.
Item 4. Mine Safety Disclosures Not applicable. Abercrombie & Fitch Co. 27 2023 Form 10-K Table of Contents PART II Item 5.
Item 4. Mine Safety Disclosures Not applicable. Abercrombie & Fitch Co. 26 2024 Form 10-K Table of Contents PART II Item 5.
(2) On November 23, 2021, we announced that the Board of Directors approved a new $500 million share repurchase authorization, replacing the prior 2021 share repurchase authorization of 10.0 million shares, which had approximately 3.9 million shares remaining available (3) The number shown represents, as of the end of each period, the approximate dollar value of Common Stock that may yet be purchased under A&F’s publicly announced stock repurchase authorization described in footnote 2 above.
(2) On November 23, 2021, we announced that the Board of Directors approved a $500 million share repurchase authorization (the “2021 Authorization”). (3) The number shown represents, as of the end of each period, the approximate dollar value of Common Stock that may yet be purchased under A&F’s publicly announced stock repurchase authorization described in footnote 2 above.
PERFORMANCE GRAPH (1) COMPARISON OF 5 YEAR CUMULATIVE TOTAL RETURN* Among A&F, the S&P 500 Index and the S&P Apparel Retail Index 02/02/19 02/01/20 01/30/21 01/29/22 01/28/23 02/03/24 A&F $ 100.00 $ 80.09 $ 114.88 $ 181.70 $ 135.99 $ 545.10 S&P 500 100.00 121.54 142.49 172.39 160.93 199.26 S&P Apparel Retail 100.00 116.51 127.14 140.78 168.22 203.80 * $100 invested on February 02, 2019, including reinvestment of dividends.
PERFORMANCE GRAPH (1) COMPARISON OF 5 YEAR CUMULATIVE TOTAL RETURN* Among A&F, the S&P 500 Index and the S&P Apparel Retail Index 02/01/20 01/30/21 01/29/22 01/28/23 02/03/24 02/01/25 A&F $ 100.00 $ 143.43 $ 226.87 $ 169.79 $ 680.60 $ 742.21 S&P 500 100.00 117.23 141.84 132.41 163.95 202.41 S&P Apparel Retail 100.00 109.13 120.83 144.39 174.93 214.25 * $100 invested on February 01, 2020, including reinvestment of dividends.
Removed
The shares may be purchased, from time to time, depending on business and market conditions.
Added
As described below, on March 5, 2025, the Company announced that the Board of Directors authorized the 2025 Authorization (defined below). The 2025 Authorization replaced the 2021 Authorization and shares may no longer be repurchased pursuant to the 2021 Authorization.
Added
On March 5, 2025, the Company announced that the Board of Directors authorized a new $1.3 billion share repurchase program (the “2025 Authorization”), which replaced the 2021 Authorization. The 2025 Authorization does not have an expiration date.
Added
Under the 2025 Authorization, the Company may repurchase shares from time to time in open market or private transactions in such manner as may be deemed advisable from time to time (including, without limitation, pursuant to accelerated share repurchase programs, one or more 10b5-1 trading plans, or any other method deemed advisable) and may be discontinued at any time.
Added
The timing and amount of any such repurchases will be determined based on an evaluation of market conditions, the Company’s share price, legal requirements, and other factors.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

34 edited+11 added−13 removed18 unchanged
Biggest changeA reconciliation of financial metrics on a constant currency basis to GAAP for Fiscal 2023 and Fiscal 2022 is as follows: (in thousands, except change in net sales, gross profit rate, operating margin and per share data) Net sales Fiscal 2023 Fiscal 2022 % Change GAAP $ 4,280,677 $ 3,697,751 16% Impact from changes in foreign currency exchange rates — 6,500 0% Net sales on a constant currency basis $ 4,280,677 $ 3,704,251 16% Gross profit Fiscal 2023 Fiscal 2022 BPS Change (1) GAAP $ 2,693,412 $ 2,104,538 600 Impact from changes in foreign currency exchange rates — (8,969) 30 Gross profit on a constant currency basis $ 2,693,412 $ 2,095,569 630 Operating income Fiscal 2023 Fiscal 2022 BPS Change (1) GAAP $ 484,671 $ 92,648 880 Excluded items (2) (4,436) (14,031) (30) Adjusted non-GAAP $ 489,107 $ 106,679 850 Impact from changes in foreign currency exchange rates — (9,608) 30 Adjusted non-GAAP on a constant currency basis $ 489,107 $ 97,071 880 Net income per diluted share attributable to A&F Fiscal 2023 Fiscal 2022 $ Change GAAP $ 6.22 $ 0.05 $6.17 Excluded items, net of tax (2) (0.06) (0.20) (0.14) Adjusted non-GAAP $ 6.28 $ 0.25 $6.03 Impact from changes in foreign currency exchange rates — (0.13) 0.13 Adjusted non-GAAP on a constant currency basis $ 6.28 $ 0.12 $6.16 (1) The estimated basis point change has been rounded based on the percentage of net sales change.
Biggest changeA reconciliation of financial metrics on a constant currency basis to GAAP for Fiscal 2024 and Fiscal 2023 is as follows: (in thousands, except change in net sales, operating margin and per share data) Net sales Fiscal 2024 Fiscal 2023 % Change GAAP $ 4,948,587 $ 4,280,677 16% Impact from changes in foreign currency exchange rates — (3,769) 0% Net sales on a constant currency basis $ 4,948,587 $ 4,276,908 16% Operating income Fiscal 2024 Fiscal 2023 BPS Change (1) GAAP $ 740,820 $ 484,671 370 Excluded items (2) — 4,436 (10) Adjusted non-GAAP $ 740,820 $ 489,107 360 Impact from changes in foreign currency exchange rates — 2,955 (10) Adjusted non-GAAP on a constant currency basis $ 740,820 $ 492,062 350 Net income per diluted share attributable to A&F Fiscal 2024 Fiscal 2023 $ Change GAAP $ 10.69 $ 6.22 $4.47 Excluded items, net of tax (2) — 0.06 0.06 Adjusted non-GAAP $ 10.69 $ 6.28 $4.41 Impact from changes in foreign currency exchange rates — 0.05 (0.05) Adjusted non-GAAP on a constant currency basis $ 10.69 $ 6.33 $4.36 (1) The estimated basis point change has been rounded based on the percentage of net sales change.
Comparable sales At times, the Company provides comparable sales, defined as the year-over-year percentage change in the aggregate of (1) sales for stores that have been open as the same brand at least one year and whose square footage has not been expanded or reduced by more than 20% within the past year, with the prior year’s net sales converted at the current year’s foreign currency exchange rates to remove the impact of foreign currency exchange rate fluctuations, and (2) digital sales with the prior year’s net sales converted at the current year’s foreign currency exchange rates to remove the impact of foreign currency exchange rate fluctuations.
Comparable sales At times, the Company provides comparable sales, defined as the year-over-year percentage change in the aggregate of (1) sales for stores that have been open as the same brand at least one year and whose square footage has not been expanded or reduced by more than 20% within the past year, with the prior fiscal year’s net sales converted at the current fiscal year’s foreign currency exchange rates to remove the impact of foreign currency exchange rate fluctuations, and (2) digital sales with the prior fiscal year’s net sales converted at the current fiscal year’s foreign currency exchange rates to remove the impact of foreign currency exchange rate fluctuations.
Management also uses financial information on a constant currency basis to award employee performance-based compensation. The effect from foreign currency exchange rates, calculated on a constant currency basis, is determined by applying the current period’s foreign currency exchange rates to the prior year’s results and is net of the year-over-year impact from hedging.
Management also uses financial information on a constant currency basis to award employee performance-based compensation. The effect from foreign currency exchange rates, calculated on a constant currency basis, is determined by applying the current period’s foreign currency exchange rates to the prior fiscal year’s results and is net of the year-over-year impact from hedging.
Deferred taxes are adjusted for enacted changes in tax rates and tax laws. Valuation allowances are recorded to reduce deferred tax assets when it is more likely than not that a tax benefit will not be realized. The Company does not expect material changes in the judgments, assumptions or interpretations used to calculate the tax provision for Fiscal 2024.
Deferred taxes are adjusted for enacted changes in tax rates and tax laws. Valuation allowances are recorded to reduce deferred tax assets when it is more likely than not that a tax benefit will not be realized. The Company does not expect material changes in the judgments, assumptions or interpretations used to calculate the tax provision for Fiscal 2025.
Financing activities - For Fiscal 2023, net cash used for financing activities primarily consisted of the purchase of $76.5 million of outstanding Senior Secured Notes for $78.0 million as well as amounts related to shares of Common Stock withheld (repurchased) to cover tax withholdings upon vesting of share-based compensation awards.
For Fiscal 2023, net cash used for financing activities primarily consisted of the purchase of $76.5 million of outstanding Senior Secured Notes for $78.0 million, as well as $29.5 million related to shares of Common Stock withheld (repurchased) to cover tax withholdings upon vesting of share-based compensation awards.
Abercrombie & Fitch Co. 42 2023 Form 10-K Table of Contents Financial Information on a Constant Currency Basis The Company provides certain financial information on a constant currency basis to enhance investors’ understanding of underlying business trends and operating performance by removing the impact of foreign currency exchange rate fluctuations.
Abercrombie & Fitch Co. 42 2024 Form 10-K Table of Contents Financial Information on a Constant Currency Basis The Company provides certain financial information on a constant currency basis to enhance investors’ understanding of underlying business trends and operating performance by removing the impact of foreign currency exchange rate fluctuations.
Abercrombie & Fitch Co. 41 2023 Form 10-K Table of Contents NON-GAAP FINANCIAL MEASURES This Annual Report on Form 10-K includes discussion of certain financial measures on both a GAAP and a non-GAAP basis. The Company believes that each of the non-GAAP financial measures presented in this “ ITEM 7.
Abercrombie & Fitch Co. 41 2024 Form 10-K Table of Contents NON-GAAP FINANCIAL MEASURES This Annual Report on Form 10-K includes discussion of certain financial measures on both a GAAP and a non-GAAP basis. The Company believes that each of the non-GAAP financial measures presented in this “ ITEM 7.
Amounts payable with known payment dates of $16.4 million have been classified in the contractual obligations table based on those scheduled payment dates. However, it is not reasonably practicable to estimate the timing and amounts for the remainder of these obligations, therefore, those amounts have been excluded in the contractual obligations table.
Amounts payable with known payment dates of $15.7 million have been classified in the contractual obligations table based on those scheduled payment dates. However, it is not reasonably practicable to estimate the timing and amounts for the remainder of these obligations; therefore, those amounts have been excluded in the contractual obligations table.
The Company does not expect material changes to the underlying assumptions used to measure the LCNRV estimate as of February 3, 2024. However, actual results could vary from estimates and could significantly impact the ending inventory valuation at cost, as well as gross profit.
The Company does not expect material changes to the underlying assumptions used to measure the LCNRV estimate as of February 1, 2025. However, actual results could vary from estimates and could significantly impact the ending inventory valuation at cost, as well as gross profit.
Refer to Note 2, “ SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Leases , ” and Note 7, “ LEASES ,” for further discussion. (2) Purchase obligations primarily consist of non-cancelable purchase orders for merchandise to be delivered during Fiscal 2024 and commitments for fabric expected to be used during upcoming seasons.
Refer to Note 2, “ SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Leases , ” and Note 8, “ LEASES ,” for further discussion. (2) Purchase obligations primarily consist of non-cancelable purchase orders for merchandise to be delivered during Fiscal 2025 and commitments for fabric expected to be used during upcoming seasons.
Fair value of the Company’s store-related assets is determined at the individual store level based on the highest and best use of the asset group. The key assumptions used in the Company’s fair value analysis are estimated sales growth and comparable market rents.
Fair value of the Company’s store-related assets is determined at the individual store level based on the highest and best use of the asset group. The key assumptions used in the Company’s fair value analysis is comparable market rents.
Operating lease obligations do not include variable payments related to both lease and nonlease components, such as contingent rent payments made by the Company based on performance, and payments related to taxes, insurance, and maintenance costs. Total variable lease cost was $168.9 million in Fiscal 2023.
Operating lease obligations do not include variable payments related to both lease and nonlease components, such as contingent rent payments made by the Company based on performance, and payments related to taxes, insurance, and maintenance costs. Total variable lease cost was $186.8 million in Fiscal 2024.
Due to uncertainty as to the amounts and timing of future payments, tax related to uncertain tax positions, including accrued interest and penalties, of $3.0 million as of February 3, 2024, is excluded from the contractual obligations table. Deferred taxes are also excluded in the contractual obligations table.
Due to uncertainty as to the amounts and timing of future payments, tax related to uncertain tax positions, including accrued interest and penalties, of $4.9 million as of February 1, 2025, is excluded from the contractual obligations table. Deferred taxes are also excluded in the contractual obligations table.
An increase or decrease in the LCNRV adjustment of 10% would have affected pre-tax loss by approximately $3.1 million for Fiscal 2023. Income Taxes The provision for income taxes is determined using the asset and liability approach.
An increase or decrease in the LCNRV adjustment of 10% would have affected pre-tax income by approximately $2.9 million for Fiscal 2024. Income Taxes The provision for income taxes is determined using the asset and liability approach.
For further discussion, refer to Note 11, “ INCOME TAXES .” As of February 3, 2024, the Company had recorded $4.7 million and $39.6 million of obligations related to its deferred compensation and supplemental retirement plans in accrued expenses and other liabilities on the Consolidated Balance Sheet, respectively.
For further discussion, refer to Note 11, “ INCOME TAXES .” As of February 1, 2025, the Company had recorded $4.4 million and $42.0 million of obligations related to its deferred compensation and supplemental retirement plans in accrued expenses and other liabilities on the Consolidated Balance Sheet, respectively.
The Company accrues for both state income taxes and foreign withholding taxes with respect to earnings and profits earned after February 2, 2019, in such a manner that these funds may be repatriated without incurring additional tax expense. As of February 3, 2024, $247.3 million of the Company’s $900.9 million of cash and equivalents were held by foreign affiliates.
The Company accrues for both state income taxes and foreign withholding taxes with respect to earnings and profits earned after February 2, 2019, in such a manner that these funds may be repatriated without incurring additional tax expense. As of February 1, 2025, $257.5 million of the Company’s $772.7 million of cash and equivalents were held by foreign affiliates.
Store assets that were tested for impairment as of February 3, 2024 and not impaired, had long-lived assets with a net book value of $11.8 million, which included $7.0 million of operating lease right-of-use assets as of February 3, 2024.
Store assets that were tested for impairment as of February 1, 2025 and not impaired, had long-lived assets with a net book value of $8.8 million, which included $8.1 million of operating lease right-of-use assets as of February 1, 2025.
RECENT ACCOUNTING PRONOUNCEMENTS The Company describes its significant accounting policies in Note 2, “ SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Recent accounting pronouncements .” The Company reviews recent accounting pronouncements on a quarterly basis and has excluded discussion of those not applicable to the Company and those that did not have, or are not expected to have, a material impact on the Company’s consolidated financial statements.
Abercrombie & Fitch Co. 40 2024 Form 10-K Table of Contents RECENT ACCOUNTING PRONOUNCEMENTS The Company describes its significant accounting policies in Note 2, “ SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Recent accounting pronouncements .” The Company reviews recent accounting pronouncements on a quarterly basis and has excluded discussion of those not applicable to the Company and those that did not have, or are not expected to have, a material impact on the Company’s consolidated financial statements.
In addition, purchase obligations include agreements to purchase goods or services, including, but not limited to, information technology, digital and marketing contracts, as well as estimated obligations related to the Company’s 13-year, 100% renewable energy supply agreement for its global home office and Company-owned distribution centers. (3) Long-term debt obligations consist of principal payments under the Senior Secured Notes.
In addition, purchase obligations include agreements to purchase goods or services, including, but not limited to, information technology, digital and marketing contracts, as well as estimated obligations related to the Company’s 13-year, 100% renewable energy supply agreement for its global home office and Company-owned distribution centers.
The Company did not have any borrowings outstanding under the ABL Facility as of February 3, 2024 or as of January 28, 2023.
The Company did not have any borrowings outstanding under the ABL Facility as of February 1, 2025 or as of February 3, 2024.
ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES ” of this Annual Report on Form 10-K for the amount remaining available for purchase under the Company’s publicly announced share repurchase authorization.
ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES ” of this Annual Report on Form 10-K for additional information regarding the Company’s publicly announced share repurchase authorization programs.
As of the end of Fiscal 2023 , the Company had recorded valuation allowances of $147.0 million Long-lived Assets Long-lived assets, primarily operating lease right-of-use assets, leasehold improvements, furniture, fixtures and equipment, are tested for recoverability whenever events or changes in circumstances indicate that the carrying amount of the long-lived asset group might not be recoverable.
Long-lived Assets Long-lived assets, primarily operating lease right-of-use assets, leasehold improvements, furniture, fixtures and equipment, are tested for recoverability whenever events or changes in circumstances indicate that the carrying amount of the long-lived asset group might not be recoverable.
(2) Refer to “ RESULTS OF OPERATIONS ,” for details on excluded items. The tax effect of excluded items is calculated as the difference between the tax provision on a GAAP basis and an adjusted non-GAAP basis. Abercrombie & Fitch Co. 43 2023 Form 10-K Table of Contents
(2) Refer to “ RESULTS OF OPERATIONS ,” for details on excluded items. The tax effect of excluded items is calculated as the difference between the tax provision on a GAAP basis and an adjusted non-GAAP basis.
Store assets that were previously impaired as of February 3, 2024, had a remaining net book value of $63.5 million, which included $53.8 million of operating lease right-of-use assets, as of February 3, 2024.
Store assets that were previously impaired as of February 1, 2025, had a remaining net book value of $77.6 million, which included $68.8 million of operating lease right-of-use assets, as of February 1, 2025.
Details regarding the remaining borrowing capacity under the ABL Facility as of February 3, 2024 follow: (in thousands) February 3, 2024 Loan cap $ 332,891 Less: Outstanding stand-by letters of credit (440) Borrowing capacity 332,451 Less: Minimum excess availability (1) (33,289) Borrowing capacity available $ 299,162 (1) The Company must maintain excess availability equal to the greater of 10% of the loan cap or $30 million under the ABL Facility.
Details regarding the remaining borrowing capacity under the ABL Facility as of February 1, 2025 follow: (in thousands) February 1, 2025 Loan cap $ 500,000 Less: Outstanding stand-by letters of credit (423) Borrowing capacity 499,577 Less: Minimum excess availability (1) (50,000) Borrowing capacity available $ 449,577 (1) Under the ABL Facility, the Company must maintain excess availability equal to the greater of 10% of the Loan Cap or $36 million.
However, changes in these judgments, assumptions or interpretations may occur and should those changes be significant, they could have a material impact on the Company’s income tax provision.
However, changes in these judgments, assumptions or interpretations may occur, and should those changes be significant, they could have a material impact on the Company’s income tax provision. As of the end of Fiscal 2024 , the Company had recorded valuation allowances of $151.8 million, of which $147.9 million relates to Switzerland.
Analysis of Cash Flows The table below provides certain components of the Company’s Consolidated Statements of Cash Flows for Fiscal 2023 and Fiscal 2022: (in thousands) Fiscal 2023 Fiscal 2022 Cash and equivalents, and restricted cash and equivalents, beginning of period $ 527,569 $ 834,368 Net cash provided by (used for) operating activities 653,422 (2,343) Net cash used for investing activities (157,182) (140,675) Net cash used for financing activities (111,201) (155,329) Effects of foreign currency exchange rate changes on cash (2,923) (8,452) Net increase (decrease) in cash and equivalents, and restricted cash and equivalents $ 382,116 $ (306,799) Cash and equivalents, and restricted cash and equivalents, end of period $ 909,685 $ 527,569 Operating activities - For Fiscal 2023 net cash provided by operating activities included increased cash receipts as a result of the 16% year-over-year increase in net sales partially offset by increased payments to vendors, including additional rent payments made during the period due to fiscal calendar shifting relative to monthly rent due dates.
Abercrombie & Fitch Co. 39 2024 Form 10-K Table of Contents Analysis of Cash Flows The table below provides certain components of the Company’s Consolidated Statements of Cash Flows for Fiscal 2024 and Fiscal 2023: (in thousands) Fiscal 2024 Fiscal 2023 Cash and equivalents, and restricted cash and equivalents, beginning of period $ 909,685 $ 527,569 Net cash provided by operating activities 710,376 653,422 Net cash used for investing activities (297,703) (157,182) Net cash used for financing activities (534,877) (111,201) Effects of foreign currency exchange rate changes on cash (7,086) (2,923) Net (decrease) increase in cash and equivalents, and restricted cash and equivalents $ (129,290) $ 382,116 Cash and equivalents, and restricted cash and equivalents, end of period $ 780,395 $ 909,685 Operating activities - For Fiscal 2024, net cash provided by operating activities included increased cash receipts as a result of the 16% year-over-year increase in net sales as compared to net cash provided by operating activities in Fiscal 2023.
Abercrombie & Fitch Co. 40 2023 Form 10-K Table of Contents CRITICAL ACCOUNTING ESTIMATES The Company’s discussion and analysis of its financial condition and results of operations are based upon the Company’s consolidated financial statements which have been prepared in accordance with GAAP.
CRITICAL ACCOUNTING ESTIMATES The Company’s discussion and analysis of its financial condition and results of operations are based upon the Company’s consolidated financial statements, which have been prepared in accordance with GAAP. The preparation of these consolidated financial statements requires the Company to make estimates and assumptions that affect the reported amounts.
The preparation of these consolidated financial statements requires the Company to make estimates and assumptions that affect the reported amounts. Since actual results may differ from those estimates, the Company revises its estimates and assumptions as new information becomes available.
Since actual results may differ from those estimates, the Company revises its estimates and assumptions as new information becomes available. Note 2, “ SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES ,” describes the significant accounting policies and methods used in the preparation of the Company’s consolidated financial statements.
Policy Effect if Actual Results Differ from Assumptions Inventory Valuation The Company reviews inventories on a quarterly basis.
The estimates and assumptions discussed below include those that the Company believes are the most critical to the portrayal of the Company’s financial condition and results of operations. Policy Effect if Actual Results Differ from Assumptions Inventory Valuation The Company reviews inventories on a quarterly basis.
For Fiscal 2022, net cash used for financing activities primarily consisted of the repurchase of approximately 4.8 million shares of Common Stock in the open market with a market value of approximately $126 million as well as the purchase of $8.0 million of outstanding Senior Secured Notes at a slight discount to par.
Financing activities - For Fiscal 2024, net cash used for financing activities primarily consisted of the repurchase of approximately 1.6 million shares of Common Stock in the open market with a market value of approximately $229.8 million, the repurchase of $9.3 million in the open market and the complete redemption of $214 million of outstanding Senior Secured Notes, and $70.2 million related to shares of Common Stock withheld (repurchased) to cover tax withholdings upon vesting of share-based compensation awards.
(4) Other obligations consists of: interest payments related to the Senior Secured Notes assuming normally scheduled principal payments; estimated asset retirement obligations; known and scheduled payments related to the Company’s deferred compensation and supplemental retirement plans; tax payments associated with the provisional, mandatory one-time deemed repatriation tax on accumulated foreign earnings, net payable over eight years pursuant to the The Tax Cuts and Jobs Act; and minimum contractual obligations related to leases signed but not yet commenced, primarily related to the Company’s stores.
(3) Other obligations consist of: estimated asset retirement obligations; known and scheduled payments related to the Company’s deferred compensation and supplemental retirement plans; and minimum contractual obligations related to leases signed but not yet commenced, primarily related to the Company’s stores. Refer to Note 8, “ LEASES ,” and Note 16, “ SAVINGS AND RETIREMENT PLANS ,” for further discussion.
Abercrombie & Fitch Co. 39 2023 Form 10-K Table of Contents Investing activities - For Fiscal 2023, net cash used for investing activities was primarily attributable to capital expenditures of $157.8 million as compared to net cash used for investing activities of $164.6 million in Fiscal 2022, primarily attributable to capital expenditures, partially offset by the proceeds from the withdrawal of $12.0 million of excess funds from Rabbi Trust assets and the sale of property and equipment of $11.9 million.
Investing activities - For Fiscal 2024, net cash used for investing activities was primarily attributable to capital expenditures of $182.9 million, as well as the purchase of $140 million in marketable securities and maturity of $25 million in marketable securities as compared to net cash used for investing activities of $157.8 million in Fiscal 2023, primarily attributable to capital expenditures.
In addition, the Amended and Restated Credit Agreement, as amended by the First Amendment, provides for the ABL Facility, which is a senior secured asset-based revolving credit facility of up to $400 million.
The Second Amendment amended the Amended and Restated Credit Agreement, dated as of April 29, 2021 (the “ABL Credit Agreement”), to, among other things (as described in greater detail below), provide for a $500 million senior secured asset-based revolving credit facility (the “ABL Facility”). The Company incurred customary fees and expenses in connection with the entry into the Second Amendment.
Removed
In May 2020, the Company announced that it had suspended its dividend program in order to preserve liquidity and maintain financial flexibility in light of COVID-19. The Company may in the future review its dividend program to determine, in light of facts and circumstances at that time, whether and when to reinstate.
Added
Abercrombie & Fitch Co. 38 2024 Form 10-K Table of Contents Senior Secured Notes On July 15, 2024 (the “Redemption Date”), Abercrombie & Fitch Management Co (“A&F Management”) redeemed all of its outstanding 8.75% Senior Secured Notes due in 2025 (the “Senior Secured Notes”), which had an aggregate principal amount of $214 million, pursuant to the terms of the indenture governing the Senior Secured Notes, at a redemption price equal to 100% of the principal amount, plus accrued and unpaid interest to, but excluding, the Redemption Date.
Removed
Any dividends are declared at the discretion of A&F’s Board of Directors.
Added
As of the Redemption Date, the Senior Secured Notes were no longer deemed outstanding and interest on the Senior Secured Notes ceased to accrue.
Removed
A&F’s Board of Directors reviews and establishes a dividend amount, if at all, based on A&F’s financial condition, results of operations, capital requirements, current and projected cash flows, business prospects and other factors, including any restrictions under the Company’s agreements related to the Senior Secured Notes and the ABL Facility.
Added
Credit Facility On August 2, 2024, A&F, as parent and a guarantor, A&F Management, as lead borrower, and certain of A&F’s direct and indirect wholly-owned subsidiaries, as additional borrowers and guarantors, entered into the Second Amendment to the Amended and Restated Credit Agreement (the “Second Amendment”), together with the lenders party thereto and Wells Fargo Bank, National Association, as administrative agent for the lenders.
Removed
There can be no assurance that the Company will declare and pay dividends in the future or, if dividends are paid, that they will be in amounts similar to past dividends.
Added
The Second Amendment amended the ABL Credit Agreement to, among other things: • increase the aggregate commitments thereunder from $400 million to $500 million; • establish a $100 million sub-facility for the benefit of Abfico Netherlands Distribution B.V.
Removed
Abercrombie & Fitch Co. 38 2023 Form 10-K Table of Contents Credit Facility and Senior Secured Notes As of February 3, 2024, the Company had $223.2 million of gross indebtedness outstanding under the Senior Secured Notes.
Added
(“Abfico”) and AFH Stores UK Limited (“AFH UK”) that is (i) secured by a first priority security interest in all assets (subject to specified exclusions) of each of Abfico and AFH UK, (ii) guaranteed by A&F and certain of its domestic direct and indirect wholly-owned subsidiaries, and (iii) subject to a borrowing base as described therein; • extend the maturity date from April 29, 2026 to August 2, 2029; • increase the letter of credit sub-limit from $50 million to $62.5 million; • decrease the swing line availability from $50 million to $30 million; • decrease the unused line fee from a variable rate of 25 basis points to 37.5 basis points to a flat rate of 25 basis points; and • increase pricing of the interest rate margin applicable to borrowings as follows: • from 1.25% to 1.50% when average availability is greater than or equal to 50% of the Loan Cap (as defined in the Second Amendment); and • from 1.50% to 1.75% when average availability is less than 50% of the Loan Cap.
Removed
During Fiscal 2023, A&F Management purchased $76.5 million of outstanding Senior Secured Notes and incurred a $2.0 million loss on extinguishment of debt, recognized in interest expense, net on the Consolidated Statements of Operations and Comprehensive Income (Loss) .
Added
Contractual Obligations As of February 1, 2025, the Company’s contractual obligations were as follows: Payments due by period (in thousands) Total Less than 1 year 1-3 years 3-5 years More than 5 years Operating lease obligations (1) $ 1,129,978 $ 267,902 $ 447,469 $ 270,912 $ 143,695 Purchase obligations (2) 356,880 274,825 73,433 7,461 1,161 Other obligations (3) 187,039 17,954 36,288 47,641 85,156 Total $ 1,673,897 $ 560,681 $ 557,190 $ 326,014 $ 230,012 (1) Operating lease obligations consist of the Company’s future undiscounted operating lease payments.
Removed
On March 15, 2023, the Company entered into the First Amendment to the Amended and Restated Credit Agreement to eliminate LIBO rate based loans and to use the current market definitions with respect to the Secured Overnight Financing Rate (“SOFR”)”, as well as to make other conforming changes.
Added
The most directly comparable GAAP financial measure is change in net sales.
Removed
Contractual Obligations As of February 3, 2024, the Company’s contractual obligations were as follows: Payments due by period (in thousands) Total Less than 1 year 1-3 years 3-5 years More than 5 years Operating lease obligations (1) $ 968,725 $ 228,719 $ 396,245 $ 247,000 $ 96,761 Purchase obligations (2) 289,241 242,469 32,110 4,438 10,224 Long-term debt obligations (3) 223,214 — 223,214 — — Other obligations (4) 119,975 49,546 21,064 20,123 29,242 Total $ 1,601,155 $ 520,734 $ 672,633 $ 271,561 $ 136,227 (1) Operating lease obligations consist of the Company’s future undiscounted operating lease payments.
Added
EBITDA and Adjusted EBITDA The Company provides EBITDA and Adjusted EBITDA as supplemental measures used by the Company's executive management to assess the Company's performance.
Removed
Refer to Note 12, “ BORROWINGS ,” for further discussion.
Added
We also believe that these supplemental performance measures are meaningful information for investors and other interested parties to use in computing the Company's core financial performance over multiple periods and with other companies by excluding the impact of differences in tax jurisdictions, debt service levels and capital investment.
Removed
Refer to Note 7, “ LEASES ,” Note 11, “ INCOME TAXES ,” Note 12, “ BORROWINGS ,” and Note 16, “ SAVINGS AND RETIREMENT PLANS ,” for further discussion.
Added
Reconciliations of non-GAAP EBITDA and Adjusted EBITDA to financial measures calculated and presented in accordance with GAAP for Fiscal 2024 and Fiscal 2023 were as follows: Fiscal 2024 Fiscal 2023 (in thousands, except ratios) % of Net Sales % of Net Sales Net income $ 574,016 11.6 % $ 335,413 7.8 % Income tax expense 194,661 3.9 148,886 3.5 Interest (income) expense, net (27,857) (0.6) 372 — Depreciation and amortization 153,773 3.2 141,104 3.3 EBITDA (1) $ 894,593 18.1 $ 625,775 14.6 Adjustments to EBITDA Asset impairment (1) — — 4,436 0.1 Adjusted EBITDA (1) $ 894,593 18.1 $ 630,211 14.7 (1) EBITDA and Adjusted EBITDA are supplemental financial measures that are not defined or prepared in accordance with GAAP.
Removed
A&F had historically paid quarterly dividends on Common Stock prior to the suspension of the dividend program in May 2020. Because the dividend program remains suspended and the payment of future dividends is subject to determination and approval by the Board of Directors, there are no amounts included in the contractual obligations table related to dividends.
Added
EBITDA is defined as net income before interest, income taxes and depreciation and amortization. Adjusted EBITDA is EBITDA adjusted for asset impairment. Abercrombie & Fitch Co. 43 2024 Form 10-K Table of Contents
Removed
Note 2, “ SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES ,” describes the significant accounting policies and methods used in the preparation of the Company’s consolidated financial statements. The estimates and assumptions discussed below include those that the Company believes are the most critical to the portrayal of the Company’s financial condition and results of operations.
Removed
The most directly comparable GAAP financial measure is change in net sales. In light of store closures related to COVID-19, comparable sales for periods prior to Fiscal 2023 included in this Annual Report on Form 10-K are not disclosed.

Item 6. [Reserved]

Selected Financial Data — reserved (removed by SEC in 2021)

63 edited+27 added−10 removed15 unchanged
Biggest changeAdditional details related to store count and gross square footage follow: Fifty-Three Weeks Ended February 3, 2024 AMERICAS (1) EMEA (2) APAC (3) Total Company Abercrombie (4) Hollister (5) Abercrombie (4) Hollister (5) Abercrombie (4) Hollister (5) Abercrombie (4) Hollister (5) Total (6) January 28, 2023 184 389 29 112 20 28 233 529 762 New 14 7 4 6 4 — 22 13 35 Permanently closed (4) (12) (4) (10) — (2) (8) (24) (32) February 3, 2024 194 384 29 108 24 26 247 518 765 Gross square footage (in thousands) : January 28, 2023 1,176 2,487 181 907 132 185 1,489 3,579 5,068 February 3, 2024 1,188 2,459 187 828 149 169 1,524 3,456 4,980 (1) The Americas segment includes the results of operations in North America and South America.
Biggest changeAdditional details related to store count and gross square footage follow: Fifty-Two Weeks Ended February 1, 2025 AMERICAS (1) EMEA (2) APAC (3) Total Company Abercrombie Hollister Abercrombie Hollister Abercrombie Hollister Abercrombie Hollister Total (4) February 3, 2024 194 384 29 108 24 26 247 518 765 New 25 15 5 1 10 9 40 25 65 Permanently closed (4) (14) (1) (9) (4) (9) (9) (32) (41) February 1, 2025 215 385 33 100 30 26 278 511 789 Gross square footage (in thousands) : February 3, 2024 1,188 2,459 187 828 149 169 1,524 3,456 4,980 February 1, 2025 1,305 2,478 214 769 174 154 1,693 3,401 5,094 (1) The Americas segment includes North America and South America.
The tax effect of pre-tax excluded items is the difference between the tax provision calculation on a GAAP basis and an adjusted non-GAAP basis. Refer to “NON-GAAP FINANCIAL MEASURES” for further details. The increase in income tax expense compared to Fiscal 2022 can be attributed to higher domestic income resulting from higher sales volume and higher AURs.
The tax effect of pre-tax excluded items is the difference between the tax provision calculation on a GAAP basis and an adjusted non-GAAP basis. Refer to “NON-GAAP FINANCIAL MEASURES” for further details. The increase in income tax expense compared to Fiscal 2023 can be attributed to higher domestic income resulting from higher sales volume and higher AURs.
A discussion of the Company’s long-term plans for growth and a summary of the Company’s performance over recent years, primarily Fiscal 2023 and Fiscal 2022. • Results of Operations . An analysis of certain components of the Company’s Consolidated Statements of Operations and Comprehensive Income (Loss) for Fiscal 2023 as compared to Fiscal 2022. • Liquidity and Capital Resources .
A discussion of the Company’s long-term plans for growth and a summary of the Company’s performance over recent years, primarily Fiscal 2024 and Fiscal 2023. • Results of Operations . An analysis of certain components of the Company’s Consolidated Statements of Operations and Comprehensive Income (Loss) for Fiscal 2024 as compared to Fiscal 2023. • Liquidity and Capital Resources .
During Fiscal 2023, the Company did not recognize income tax benefits on $103.0 million of pre-tax losses, primarily in Switzerland, resulting in adverse tax impacts of $15.6 million. The primary driver relates to expense deleverage within the APAC and EMEA regions, although to a lesser extent than in the prior year.
During Fiscal 2023, the Company did not recognize income tax benefits on $103.0 million of pre-tax losses, primarily in Switzerland, resulting in adverse tax impacts of $15.6 million. The primary driver relates to expense deleverage within the APAC and EMEA regions, although to a lesser extent than in Fiscal 2022.
All references herein to the Company’s fiscal years are as follows: Fiscal year Year ended/ ending Number of weeks Fiscal 2021 January 29, 2022 52 Fiscal 2022 January 28, 2023 52 Fiscal 2023 February 3, 2024 53 Fiscal 2024 February 1, 2025 52 Seasonality Historically, the Company’s operations have been seasonal in nature and consist of two principal selling seasons: the spring season, which includes the first and second fiscal quarters (“Spring”) and the fall season, which includes the third and fourth fiscal quarters (“Fall”).
All references herein to the Company’s fiscal years are as follows: Fiscal year Year ended/ ending Number of weeks Fiscal 2022 January 28, 2023 52 Fiscal 2023 February 3, 2024 53 Fiscal 2024 February 1, 2025 52 Fiscal 2025 January 31, 2026 52 Seasonality Historically, the Company’s operations have been seasonal in nature and consist of two principal selling seasons: the spring season, which includes the first and second fiscal quarters (“Spring”) and the fall season, which includes the third and fourth fiscal quarters (“Fall”).
The Company continues to use data to inform its focus on aligning store square footage with digital penetration and the Company delivered new store experiences across brands during Fiscal 2023 and Fiscal 2022.
The Company continues to use data to inform its focus on aligning store square footage with digital penetration and the Company delivered new store experiences across brands during Fiscal 2024 and Fiscal 2023.
BUSINESS - STRATEGY AND KEY BUSINESS PRIORITIES .” Examples of potential investment opportunities include, but are not limited to, new store experiences, and investments in the Company’s digital revolution initiatives.
BUSINESS - STRATEGY AND KEY BUSINESS PRIORITIES .” Examples of potential investment opportunities include, but are not limited to, new store experiences, and investments in the Company’s digital and omnichannel initiatives.
This typically results in a fifty-two-week year, but occasionally gives rise to an additional week, resulting in a fifty-three-week year, as is the case in Fiscal 2023.
This typically results in a fifty-two-week year, but occasionally gives rise to an additional week, resulting in a fifty-three-week year, as was the case in Fiscal 2023.
A discussion of the Company’s financial condition, changes in financial condition and liquidity as of February 3, 2024, which includes (i) an analysis of changes in cash flows for Fiscal 2023 as compared to Fiscal 2022, (ii) an analysis of liquidity, including availability under the Company’s credit facility, and outstanding debt and covenant compliance and (iii) a summary of contractual and other obligations as of February 3, 2024. • Recent Accounting Pronouncements .
A discussion of the Company’s financial condition, changes in financial condition and liquidity as of February 1, 2025, which includes (i) an analysis of changes in cash flows for Fiscal 2024 as compared to Fiscal 2023, (ii) an analysis of liquidity, including availability under the Company’s credit facility, and outstanding debt and covenant compliance and (iii) a summary of contractual and other obligations as of February 1, 2025. • Recent Accounting Pronouncements .
Refer to Note 11, “ INCOME TAXES ,” for further discussion on factors that impacted the effective tax rate in Fiscal 2023 and Fiscal 2022.
Refer to Note 11, “ INCOME TAXES ,” for further discussion on factors that impacted the effective tax rate in Fiscal 2024 and Fiscal 2023.
This section includes certain reconciliations between GAAP and non-GAAP financial measures and additional details on non-GAAP financial measures, including information as to why the Company believes the non-GAAP financial measures provided within MD&A are useful to investors. Abercrombie & Fitch Co. 30 2023 Form 10-K Table of Contents OVERVIEW Business Summary Abercrombie & Fitch Co.
This section includes certain reconciliations between GAAP and non-GAAP financial measures and additional details on non-GAAP financial measures, including information as to why the Company believes the non-GAAP financial measures provided within MD&A are useful to investors. Abercrombie & Fitch Co. 29 2024 Form 10-K Table of Contents OVERVIEW Business Summary Abercrombie & Fitch Co.
Item 6. [Reserved] Abercrombie & Fitch Co. 29 2023 Form 10-K Table of Contents Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations The following Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) generally discusses our results of operations for Fiscal 2023 and Fiscal 2022 and provides comparisons between such fiscal years.
Item 6. [Reserved] Abercrombie & Fitch Co. 28 2024 Form 10-K Table of Contents Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations The following Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) generally discusses our results of operations for Fiscal 2024 and Fiscal 2023 and provides comparisons between such fiscal years.
Historically, the Company has utilized free cash flow generated from operations to fund any discretionary capital expenditures, which have been prioritized towards new store experiences, as well as marketing, digital and omnichannel investments, information technology, and other projects. For Fiscal 2023, the Company used $157.8 million towards capital expenditures, down from $164.6 million of capital expenditures in Fiscal 2022.
Historically, the Company has utilized free cash flow generated from operations to fund any discretionary capital expenditures, which have been prioritized towards new store experiences, as well as marketing, digital and omnichannel investments, information technology, and other projects. For Fiscal 2024, the Company used $182.9 million towards capital expenditures, up from $157.8 million of capital expenditures in Fiscal 2023.
For discussion and comparison of Fiscal 2022 and Fiscal 2021, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7 of our Annual Report on Form 10-K for Fiscal 2022, filed with the SEC on March 27, 2023.
For discussion and comparison of Fiscal 2023 and Fiscal 2022, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7 of our Annual Report on Form 10-K for Fiscal 2023, filed with the SEC on April 1, 2024.
Historically, the Company has repurchased shares of its Common Stock from time to time, dependent on excess liquidity, market conditions, and business conditions, with the objectives of returning excess cash to shareholders and offsetting dilution from issuances of Common Stock associated with the exercise of employee stock appreciation rights and the vesting of restricted stock units.
Historically, the Company has repurchased shares of its Common Stock from time to time, which repurchases are dependent on excess liquidity, market conditions, and business conditions, with the objectives of returning excess cash to shareholders and offsetting dilution from issuances of Common Stock associated with the vesting of restricted stock units.
Abercrombie & Fitch Co. 32 2023 Form 10-K Table of Contents Global Store Network Optimization The Company has a goal of finding the right size, right location and right economics for omni-enabled stores that cater to local customers.
Abercrombie & Fitch Co. 31 2024 Form 10-K Table of Contents Global Store Network Modernization and Growth The Company has a goal of finding the right size, right location and right economics for omni-enabled stores that cater to local customers.
(6) This store count excludes temporary and international franchise stores. Pillar Two Model Rules In 2021, the Organization for Economic Cooperation and Development (“OECD”) released Pillar Two Global Anti-Base Erosion model rules (“Pillar Two Rules”), designed to ensure large corporations are taxed at a minimum rate of 15% in all countries of operation.
Pillar Two Model Rules In 2021, the Organization for Economic Cooperation and Development (“OECD”) released Pillar Two Global Anti-Base Erosion model rules (“Pillar Two Rules”), designed to ensure large corporations are taxed at a minimum rate of 15% in all countries of operation.
Key Performance Indicators The following measurements are among the key performance indicators reviewed by the Company’s management in assessing the Company’s results: • Changes in net sales and comparable sales; • Gross profit and gross profit rate; • Cost of sales, exclusive of depreciation and amortization, as a percentage of net sales; • Stores and distribution expense as a percentage of net sales; • Marketing, general and administrative expense as a percentage of net sales; • Operating income and operating income as a percentage of net sales (“operating margin”); • Net income and net income attributable to A&F; • Cash flow and liquidity measures, such as the Company’s working capital, operating cash flow, and free cash flow; • Inventory metrics, such as inventory turnover; • Return on invested capital and return on equity; • Store metrics, such as net sales per gross square foot, and store four-wall operating margins; • Digital and omnichannel metrics, such as total shipping expense as a percentage of digital sales, and certain metrics related to our purchase-online-pickup-in-store and order-in-store programs; • Transactional metrics, such as traffic and conversion, performance across key product categories, average unit retail (“AUR’), average unit cost (“AUC”), average units per transaction and average transaction values, return rates, shrink; and • Customer-centric metrics such as customer satisfaction, customer retention and acquisition, and certain metrics related to the loyalty programs.
Key Performance Indicators The following measurements are among the key performance indicators reviewed by the Company’s management in assessing the Company’s results: • Net sales and comparable sales by region and brand; • Cost of sales, exclusive of depreciation and amortization, as a percentage of net sales; • Gross profit and gross profit rate; • Selling expense as a percentage of net sales; • General and administrative expense as a percentage of net sales; • Operating income, including by region, and operating income as a percentage of net sales (“operating margin”); • Earnings before interest, taxes, depreciation and amortization (“EBITDA”) • Net income and net income attributable to A&F; • Net income per diluted share attributable to A&F; • Cash flow and liquidity measures, such as the Company’s working capital, operating cash flow, and free cash flow; • Inventory metrics, such as inventory turnover; • Return on invested capital and return on equity; • Store metrics, such as net sales per gross square foot, and store four-wall operating margins; • Digital and omnichannel metrics; • Transactional metrics, such as traffic and conversion, performance across key product categories, average unit retail (“AUR’), average unit cost (“AUC”), average units per transaction and average transaction values, return rates, shrink; and • Customer-centric metrics such as customer retention and acquisition, and certain metrics related to the loyalty programs.
In addition, the Company continuously evaluates potential opportunities to strategically deploy excess cash and/or deleverage the balance sheet, depending on various factors, such as market and business conditions, including the Company’s ability to accelerate investments in the business. Such opportunities may include, but are not limited to, purchasing outstanding Senior Secured Notes or share repurchases.
In addition, management continuously evaluates potential opportunities to strategically deploy excess cash and/or deleverage the balance sheet, in consideration on various factors, such as market and business conditions, and the Company’s ability to accelerate investments in the business. Such opportunities may include, but are not limited to, share repurchases.
In periods of perceived or actual unfavorable economic conditions, consumers may reallocate available discretionary spending, which may adversely impact demand for our products.
In periods of perceived or actual unfavorable economic conditions, consumers may reallocate available discretionary spending or determine that they have fewer funds available for discretionary spending, which may adversely impact demand for our products.
The 2025 Always Forward Plan is anchored on our strategic growth principles, which are to: • Execute focused growth plans; • Accelerate an enterprise-wide digital revolution; and • Operate with financial discipline The 2025 Always Forward Plan growth principles serve as a framework for the Company achieving sustainable and profitable growth and profitability in Fiscal 2024.
The Always Forward Plan is anchored on our strategic growth principles, which are to: • Execute focused growth plans; • Accelerate an enterprise-wide digital revolution; and • Operate with financial discipline While the Company has significantly outperformed certain financial targets set forth in the Always Forward Plan, the growth principles continue to serve as a framework for the Company achieving sustainable and profitable growth and profitability.
Net Income Per Diluted Share Attributable to A&F Fiscal 2023 Fiscal 2022 $ Change Net income per diluted share attributable to A&F $ 6.22 $ 0.05 $6.17 Excluded items, net of tax (1) 0.06 0.20 (0.14) Adjusted non-GAAP net income per diluted share attributable to A&F $ 6.28 $ 0.25 $6.03 Impact from changes in foreign currency exchange rates — (0.13) 0.13 Adjusted non-GAAP net income per diluted share attributable to A&F on a constant currency basis (2) $ 6.28 $ 0.12 $6.16 (1) Excludes items presented above under “ Operating Income , ” and “ Income Tax Expense . ” (2) Refer to “ NON-GAAP FINANCIAL MEASURES ,” for further details.
Net Income Per Diluted Share Attributable to A&F Fiscal 2024 Fiscal 2023 $ Change Net income per diluted share attributable to A&F $ 10.69 $ 6.22 $ 4.47 Excluded items, net of tax (1) — 0.06 (0.06) Adjusted non-GAAP net income per diluted share attributable to A&F $ 10.69 $ 6.28 $ 4.41 Impact from changes in foreign currency exchange rates — 0.05 (0.05) Adjusted non-GAAP net income per diluted share attributable to A&F on a constant currency basis (2) $ 10.69 $ 6.33 $ 4.36 (1) Excludes items presented above under “ Operating Income , ” and “ Income Tax Expense . ” (2) Refer to “ NON-GAAP FINANCIAL MEASURES ,” for further details.
Details related to these new store experiences follow: Type of new store experience Fiscal 2023 Fiscal 2022 New stores 35 59 Remodels 13 1 Right-sizes 9 8 Total 57 68 During Fiscal 2023, the Company opened 35 new stores, while closing 32 stores. This compares with 59 new stores and 26 closures during Fiscal 2022 .
Details related to these new store experiences follow: Type of new store experience Fiscal 2024 Fiscal 2023 New stores 65 35 Remodels 48 13 Right-sizes 12 9 Total 125 57 During Fiscal 2024, the Company opened 65 new stores, while closing 41 stores. This compares with 35 new stores and 32 closures during Fiscal 2023 .
Although the U.S. has not yet enacted legislation implementing Pillar Two Rules, other countries where the Company does business, including the U.K. and Germany, have enacted legislation implementing Pillar Two Rules which are effective from January 1, 2024.
Although the U.S. withdrew the U.S. from the OECD’s global tax agreement in January 2025, other countries where the Company does business, including the U.K. and Germany, have enacted legislation implementing Pillar Two Rules, which are effective from January 1, 2024.
Other Operating Income, Net Fiscal 2023 Fiscal 2022 (in thousands) % of Net Sales % of Net Sales BPS Change Other operating income, net $ 5,873 0.1% $ 2,674 0.1% — For Fiscal 2023, other operating income, net, increased as compared to Fiscal 2022, primarily due to $0.9 million foreign currency gain recognized in Fiscal 2023.
Other Operating Income, Net Fiscal 2024 Fiscal 2023 (in thousands) % of Net Sales % of Net Sales BPS Change Other operating income, net $ 6,632 0.1% $ 5,873 0.1% — For Fiscal 2024, other operating income, net, increased as compared to Fiscal 2023, primarily due to $0.7 million foreign currency gains recognized in Fiscal 2024.
The Company evaluates opportunities for investments in the business that are in line with initiatives that position the business for sustainable long-term growth that align with its strategic pillars as described within “ ITEM 1.
When evaluating opportunities for investments in the business, management considers alignment with initiatives that position the business for sustainable long-term growth that align with its strategic pillars as described within “ ITEM 1.
INTRODUCTION MD&A is provided as a supplement to the accompanying Consolidated Financial Statements and notes thereto to help provide an understanding of the Company’s results of operations, financial condition, and liquidity. MD&A is organized as follows: • Overview .
Prior period amounts have been reclassified to conform to the current fiscal year’s presentation. INTRODUCTION MD&A is provided as a supplement to the accompanying Consolidated Financial Statements and notes thereto to help provide an understanding of the Company’s results of operations, financial condition, and liquidity. MD&A is organized as follows: • Overview .
Cost of Sales, Exclusive of Depreciation and Amortization Fiscal 2023 Fiscal 2022 (in thousands) % of Net Sales % of Net Sales BPS Change Cost of sales, exclusive of depreciation and amortization $ 1,587,265 37.1% $ 1,593,213 43.1% (600) For Fiscal 2023, cost of sales, exclusive of depreciation and amortization, as a percentage of net sales decreased approximately 600 basis points as compared to Fiscal 2022.
Cost of Sales, Exclusive of Depreciation and Amortization Fiscal 2024 Fiscal 2023 (in thousands) % of Net Sales % of Net Sales BPS Change Cost of sales, exclusive of depreciation and amortization $ 1,773,926 35.8 % $ 1,587,265 37.1 % (130) For Fiscal 2024, cost of sales, exclusive of depreciation and amortization, as a percentage of net sales decreased approximately 130 basis points as compared to Fiscal 2023.
Over the next twelve months, the Company expects its primary cash requirements to be directed towards prioritizing investments in the business and continuing to fund operating activities, including the acquisition of inventory, and obligations related to compensation, marketing, data and technology, leases and any lease buyouts or modifications it may exercise, taxes and other operating activities.
The Company also has the ABL Facility available as a source of additional funding, which is described further below under “ Credit Facility.” Over the next twelve months, the Company expects its primary cash requirements to be directed towards prioritizing investments in the business and continuing to fund operating activities, including the acquisition of inventory, and obligations related to compensation, marketing, data and technology, leases and any lease buyouts or modifications it may exercise, taxes and other operating activities.
Certain components of the Company’s Consolidated Balance Sheets as of February 3, 2024 and January 28, 2023 and Consolidated Statements of Cash Flows for Fiscal 2023 and Fiscal 2022 were as follows: (in thousands) Balance Sheets data February 3, 2024 January 28, 2023 Cash and equivalents $ 900,884 $ 517,602 Gross borrowings outstanding, carrying amount 223,214 299,730 Inventories 469,466 505,621 Statements of Cash Flows data Fiscal 2023 Fiscal 2022 Net cash provided by (used for) operating activities $ 653,422 $ (2,343) Net cash used for investing activities (157,182) (140,675) Net cash used for financing activities (111,201) (155,329) Abercrombie & Fitch Co. 34 2023 Form 10-K Table of Contents RESULTS OF OPERATIONS The estimated basis point (“BPS”) changes disclosed throughout this Results of Operations have been rounded based on the change in the percentage of net sales.
Certain components of the Company’s Consolidated Balance Sheets as of February 1, 2025 and February 3, 2024 and Consolidated Statements of Cash Flows for Fiscal 2024 and Fiscal 2023 were as follows: (in thousands) Balance Sheets data February 1, 2025 February 3, 2024 Cash and equivalents $ 772,727 $ 900,884 Marketable securities 116,221 — Gross borrowings outstanding, carrying amount — 223,214 Inventories 575,005 469,466 Statements of Cash Flows data Fiscal 2024 Fiscal 2023 Net cash provided by operating activities $ 710,376 $ 653,422 Net cash used for investing activities (297,703) (157,182) Net cash used for financing activities (534,877) (111,201) Abercrombie & Fitch Co. 33 2024 Form 10-K Table of Contents RESULTS OF OPERATIONS The estimated basis point (“BPS”) changes disclosed throughout this Results of Operations have been rounded based on the change in the percentage of net sales.
Abercrombie & Fitch Co. 33 2023 Form 10-K Table of Contents Summary of Results A summary of results for Fiscal 2023 and Fiscal 2022 follows: GAAP Non-GAAP (1) (in thousands, except change in net sales, gross profit rate, operating income margin and per share amounts) Fiscal 2023 Fiscal 2022 Fiscal 2023 Fiscal 2022 Net sales $ 4,280,677 $ 3,697,751 Change in net sales from the prior fiscal year 16 % — % Comparable sales (2) 13 % — % Gross profit rate (3) 62.9 % 56.9 % Operating income $ 484,671 $ 92,648 $ 489,107 $ 106,679 Operating income margin 11.3 % 2.5 % 11.4 % 2.9 % Net income attributable to A&F $ 328,123 $ 2,816 $ 331,328 $ 13,045 Net income per diluted share attributable to A&F $ 6.22 $ 0.05 $ 6.28 $ 0.25 (1) Refer to “ RESULTS OF OPERATIONS ” for details on excluded items.
Abercrombie & Fitch Co. 32 2024 Form 10-K Table of Contents Summary of Results A summary of results for Fiscal 2024 and Fiscal 2023 follows: GAAP Non-GAAP (1) (in thousands, except change in net sales, operating income margin and per share amounts) Fiscal 2024 Fiscal 2023 Fiscal 2024 Fiscal 2023 Net sales $ 4,948,587 $ 4,280,677 Change in net sales from the prior fiscal year 16 % 16 % Comparable sales (2) 17 % 13 % Operating income $ 740,820 $ 484,671 $ 489,107 Operating income margin 15.0 % 11.3 % 11.4 % Net income attributable to A&F $ 566,223 $ 328,123 $ 331,328 Net income per diluted share attributable to A&F $ 10.69 $ 6.22 $ 6.28 (1) Refer to “ RESULTS OF OPERATIONS ” for details on excluded items.
Net Income Attributable to A&F Fiscal 2023 Fiscal 2022 (in thousands) % of Net Sales % of Net Sales BPS Change Net income attributable to A&F $ 328,123 7.7% $ 2,816 0.1% 760 Excluded items, net of tax (1) 3,205 0.1% 10,229 0.3% (20) Adjusted non-GAAP net income attributable to A&F (2) $ 331,328 7.7% $ 13,045 0.4% 730 (1) Excludes items presented above under “ Operating Income , ” and “ Income Tax Expense . ” (2) Refer to “ NON-GAAP FINANCIAL MEASURES ,” for further details.
Abercrombie & Fitch Co. 36 2024 Form 10-K Table of Contents Net Income Attributable to A&F Fiscal 2024 Fiscal 2023 (in thousands) % of Net Sales % of Net Sales BPS Change Net income attributable to A&F $ 566,223 11.4 % $ 328,123 7.7 % 370 Excluded items, net of tax (1) — — 3,205 0.1 (10) Adjusted non-GAAP net income attributable to A&F (2) $ 566,223 11.4 $ 331,328 7.7 370 (1) Excludes items presented above under “ Operating Income , ” and “ Income Tax Expense . ” (2) Refer to “ NON-GAAP FINANCIAL MEASURES ,” for further details.
During Fiscal 2022, the Company did not recognize income tax benefits on $136.5 million of pre-tax losses, primarily in Switzerland, resulting in adverse tax impacts of $20.0 million. The primary driver relates to lower sales volume, higher AUC and overall expense deleverage within the APAC and EMEA regions.
During Fiscal 2024, the Company did not recognize income tax benefits on $53.8 million of pre-tax losses, primarily in Switzerland, resulting in adverse tax impacts of $8.2 million. The primary driver relates to expense deleverage within the APAC and EMEA regions.
Total capital expenditures for Fiscal 2024 are expected to be approximately $170 million. Share Repurchases and Dividends In November 2021, A&F’s Board of Directors approved a $500 million share repurchase authorization. During Fiscal 2023, the Company did not repurchase any shares of its common stock pursuant to this share repurchase authorization.
Total capital expenditures for Fiscal 2025 are expected to be approximately $200 million. Share Repurchases In November 2021, A&F’s Board of Directors approved a $500 million share repurchase authorization (the “2021 Authorization”). During Fiscal 2024, the Company repurchased $230 million, or 1.6 million shares, of its Common Stock pursuant to the 2021 Authorization.
Global Events and Supply Chain Disruptions As a global multi-brand omnichannel specialty retailer, with operations in North America, Europe, the Middle East, and Asia, among other regions, management is mindful of macroeconomic risks, global challenges and the changing global geopolitical environment, including the ongoing armed conflicts between Russia and Ukraine or Israel and Hamas, and conflict in the surrounding areas, which could adversely impact certain areas of the business.
Global Events and Supply Chain Disruptions As a global multi-brand omnichannel specialty retailer, with operations in North America, Europe, the Middle East, and Asia, among other regions, management is mindful of macroeconomic risks, global challenges and the changing global geopolitical environment.
The Company generally experiences its greatest sales activity during the Fall season, due to the back-to-school and holiday sales periods. The Company relies on excess operating cash flows, which are largely generated in Fall, to fund operations throughout the year and to reinvest in the business to support future growth.
The Company relies on excess operating cash flows, which are largely generated in Fall, to fund operations throughout the fiscal year and to reinvest in the business to support future growth.
The Company has taken certain mitigating actions in response to these events, including increasing air freight usage where appropriate and prioritizing critical orders earlier to allow for longer lead times. Further mitigating actions may be needed as we continue in to Fiscal 2024, particularly if there is prolonged or escalating conflict in the Red Sea.
The Company has taken certain mitigating actions in response to these disruptions, including increasing air freight usage where appropriate and prioritizing critical orders earlier to allow for longer lead times. Further mitigating actions may be needed, particularly if there is prolonged port congestion or transportation delays, and could result in higher freight costs in the near-term and beyond.
The net decrease can be attributable to higher interest income due to the increase in balance and rates received on deposits and money market accounts as compared to Fiscal 2022.
Additionally, interest income increased due to the increase in balance and rates received on time deposits and money market accounts as compared to Fiscal 2023.
Corporate functions and other income and expenses are evaluated on a consolidated basis and are not allocated to the Company’s segments, and therefore are included as a reconciling item between segment and total operating income (loss). There was no impact on consolidated net sales, operating income (loss) or net income (loss) as a result of these changes.
Corporate functions and other income and expenses are evaluated on a consolidated basis and are not allocated to the Company’s segments, and therefore are included as a reconciling item between segment and total operating income (loss). The Company’s brand families includes Abercrombie brands and Hollister brands.
While freight costs decreased in Fiscal 2023, the recent disruptions in the Red Sea may offset anticipated future freight cost benefits. Management continues to monitor global events and assess the potential impacts that these events and similar events may have on the business in future periods.
Management continues to monitor global events and assess the potential impacts that these and similar events may have on the business in future periods.
Abercrombie & Fitch Co. 36 2023 Form 10-K Table of Contents Income Tax Expense Fiscal 2023 Fiscal 2022 (in thousands, except ratios) Effective Tax Rate Effective Tax Rate Income tax expense $ 148,886 30.7% $ 56,631 84.5% Excluded items: Tax effect of pre-tax excluded items (1) 1,231 3,802 Adjusted non-GAAP income tax expense $ 150,117 30.7% $ 60,433 74.6% (1) Refer to “ Operating Income ” for details of pre-tax excluded items.
Income Tax Expense Fiscal 2024 Fiscal 2023 (in thousands, except ratios) Effective Tax Rate Effective Tax Rate Income tax expense $ 194,661 25.3 % $ 148,886 30.7 % Excluded items: Tax effect of pre-tax excluded items (1) — 1,231 Adjusted non-GAAP income tax expense $ 194,661 25.3 $ 150,117 30.7 (1) Refer to “ Operating Income ” for details of pre-tax excluded items.
Interest Expense, Net Fiscal 2023 Fiscal 2022 (in thousands) % of Net Sales % of Net Sales BPS Change Interest expense $ 30,352 0.7% $ 30,236 0.8% (10) Interest income (29,980) (0.7)% (4,604) (0.1)% (60) Interest expense, net $ 372 —% $ 25,632 0.7% (70) For Fiscal 2023, interest expense, net, decreased 70 basis points as compared to Fiscal 2022.
Interest (Income) Expense, Net Fiscal 2024 Fiscal 2023 (in thousands) % of Net Sales % of Net Sales BPS Change Interest expense $ 12,077 0.2 % $ 30,352 0.7 % (50) Interest income (39,934) (0.8) (29,980) (0.7) (10) Interest (income) expense, net $ (27,857) (0.6) $ 372 — (60) For Fiscal 2024, interest (income) expense, net, increased 60 basis points as compared to Fiscal 2023.
Refer to “ NON-GAAP FINANCIAL MEASURES, ” for further details on the comparable sales calculation. (2) Abercrombie brands includes Abercrombie & Fitch and abercrombie kids. (3) Hollister brands includes Hollister and Gilly Hicks.
Refer to “ NON-GAAP FINANCIAL MEASURES, ” for further details on the comparable sales calculation.
Abercrombie & Fitch Co. 31 2023 Form 10-K Table of Contents CURRENT TRENDS AND OUTLOOK Focus Areas for Fiscal 2024 In June of Fiscal 2022, we announced our 2025 Always Forward Plan, which outlines our long-term strategy and goals, including growing shareholder value.
Abercrombie & Fitch Co. 30 2024 Form 10-K Table of Contents CURRENT TRENDS AND OUTLOOK Focus Areas for Fiscal 2025 The Company introduced the Always Forward Plan in June of Fiscal 2022.
The year-over-year increase in net sales reflects positive comparable sales of 13%, as compared to Fiscal 2022, with comparable sales growth in the Americas, EMEA, and APAC segments.
The year-over-year increase in net sales reflects positive comparable sales of 17%, as compared to Fiscal 2023. • Net sales growth in the Americas region of 17% on both a reported and comparable sales basis.
The Company does not expect the implementation of the Pillar Two Rules in each jurisdiction in which it operates will have a material impact on the Company’s effective tax rate. The Company will continue to evaluate the impact as jurisdictions implement legislation and provide further guidance.
The implementation of Pillar Two Rules in each jurisdiction in which the Company operates did not have a material impact on the Company’s effective tax rate for Fiscal 2024, and the Company does not project a material impact on the effective tax rate for Fiscal 2025.
Below are some additional details specific to Fiscal 2024 objectives within the 2025 Always Forward Plan: Execute focused growth plans by: • driving sales growth across regions and brands primarily through marketing and store investment. • using our playbooks globally to align the brands’ products, voices, and experiences with customers, both digitally and in-store; and • using testing and chase strategies to deliver compelling assortments and product collections across genders.
Execute focused growth plans by: • driving sales growth across regions and brand families primarily through marketing and store investments in our owned and operating channels, while pursuing new geographies and markets via franchise, wholesale and licensing partnerships; • using our regionally relevant brand playbooks globally to align the brands’ products, voices, and experiences with customers, both digitally and in-store; and • using testing and chase strategies to deliver compelling assortments and product collections across genders.
The Company’s net sales by brand for Fiscal 2023 and Fiscal 2022 were as follows: (in thousands) Fiscal 2023 Fiscal 2022 $ Change % Change Comparable Sales (1) Abercrombie (2) $ 2,201,686 $ 1,734,866 $ 466,820 27% 23% Hollister (3) 2,078,991 1,962,885 116,106 6% 4% Total Company $ 4,280,677 $ 3,697,751 $ 582,926 16% 13% (1) Comparable sales are calculated on a constant currency basis.
The Company’s net sales by brand for Fiscal 2024 and Fiscal 2023 were as follows: (in thousands) Fiscal 2024 Fiscal 2023 $ Change % Change Comparable Sales (1) Abercrombie $ 2,556,434 $ 2,201,686 $ 354,748 16 % 15 % Hollister 2,392,153 2,078,991 313,162 15 19 Total Company $ 4,948,587 $ 4,280,677 $ 667,910 16 17 (1) Comparable sales are calculated on a constant currency basis.
For a discussion of the Company’s share repurchase activity and suspended dividend program, please see below under “Share repurchases and dividends.” Primary Sources and Uses of Cash The Company’s business has two principal selling seasons: the spring season, which includes the first and second fiscal quarters (“Spring”) and the fall season, which includes the third and fourth fiscal quarters (“Fall”).
For a discussion of the Company’s share repurchase activity, please see below under “Share Repurchases.” Primary Sources and Uses of Cash The Company’s business has two principal selling seasons: Spring and Fall. The Company generally experiences its greatest sales activity during the Fall season, due to the back-to-school and holiday sales periods.
Abercrombie & Fitch Co. 37 2023 Form 10-K Table of Contents LIQUIDITY AND CAPITAL RESOURCES Overview The Company’s capital allocation strategy and priorities are reviewed by the A&F’s Board of Directors quarterly considering both liquidity and valuation factors. The Company believes that it will have adequate liquidity to fund operating activities for the next twelve months.
EBITDA is defined as net income before interest, income taxes and depreciation and amortization. Adjusted EBITDA is EBITDA adjusted for asset impairment. Abercrombie & Fitch Co. 37 2024 Form 10-K Table of Contents LIQUIDITY AND CAPITAL RESOURCES Overview The Company’s capital allocation strategy and priorities are reviewed by A&F’s Board of Directors quarterly considering both liquidity and valuation factors.
Net Sales Net sales by segment are presented by attributing revenues on the basis of the segment that fulfills the order.
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 Fiscal 2023 and Fiscal 2022 were as follows: (in thousands) Fiscal 2023 Fiscal 2022 $ Change % Change Comparable Sales (1) Americas $ 3,455,674 $ 2,920,157 $ 535,517 18% 13% EMEA 687,095 658,794 28,301 4% 7% APAC 137,908 118,800 19,108 16% 26% Total Company $ 4,280,677 $ 3,697,751 $ 582,926 16% 13% (1) Comparable sales are calculated on a constant currency basis.
The Company’s net sales by reportable segment for Fiscal 2024 and Fiscal 2023 were as follows: (in thousands) Fiscal 2024 Fiscal 2023 $ Change % Change Comparable Sales (1) Americas $ 4,027,514 $ 3,455,674 $ 571,840 17 % 17 % EMEA 770,519 687,095 83,424 12 16 APAC 150,554 137,908 12,646 9 19 Total Company $ 4,948,587 $ 4,280,677 $ 667,910 16 17 (1) Comparable sales are calculated on a constant currency basis.
Continued inflationary pressures and pricing volatility could further impact expenses and have a long-term impact on the Company because increasing costs may impact its ability to maintain satisfactory margins.
In addition, freight costs have remained heightened since the start of the second quarter of Fiscal 2024, which we expect to continue through the first half of Fiscal 2025. Continued inflationary pressures could further impact expenses and have a long-term impact on the Company, as increasing costs may impact its ability to maintain satisfactory margins.
During the second quarter of Fiscal 2023, to leverage the knowledge and experience of our regional teams to drive brand growth, the Company reorganized its structure and now primarily manages its business on a geographic basis, consisting of three reportable segments: Americas; Europe, the Middle East and Africa (EMEA); and Asia-Pacific (APAC).
The Company manages its business on a geographic basis, consisting of three reportable segments: Americas; Europe, the Middle East and Africa (“EMEA”); and Asia-Pacific (“APAC”).
Refer to “ NON-GAAP FINANCIAL MEASURES , ” for further details on the comparable sales calculation. For Fiscal 2023, net sales increased 16%, as compared to Fiscal 2022, primarily due to an increase in units sold and AUR. The additional week in fiscal 2023 benefited net sales by approximately $50 million.
Refer to “ NON-GAAP FINANCIAL MEASURES , ” for further details on the comparable sales calculation. For Fiscal 2024, net sales increased 16%, as compared to Fiscal 2023. The increase was primarily attributable to a high-single-digit increase in AUR from lower promotional activity and category mix into higher ticket items.
(2) The EMEA segment includes the results of operations in Europe, the Middle East and Africa. (3) The APAC segment includes the results of operations in the Asia-Pacific region, including Asia and Oceania. (4) Abercrombie brands includes Abercrombie & Fitch and abercrombie kids. (5) Hollister brands includes Hollister and Gilly Hicks.
(2) The EMEA segment includes Europe, the Middle East and Africa. (3) The APAC segment includes the Asia-Pacific region, including Asia and Oceania. (4) This store count excludes temporary and international franchise stores.
Shares may be repurchased in the open market, including pursuant to trading plans established in accordance with Rule 10b5-1 of the Exchange Act through privately negotiated transactions or other transactions or by a combination of such methods. Refer to “
Shares may be repurchased in the open market or in private transactions in such manner as be deemed advisable from time to time (including, without limitation, pursuant to accelerated share repurchase programs, one or more trading plans established in accordance with Rule 10b5-1 of the Exchange Act, or any other method deemed advisable) and may be discontinued at any time.
The decrease was primarily driven by expense leverage as a result of net sales growth, slightly offset by an increase of $18 million in store occupancy expense compared to Fiscal 2022.
The decrease as a percent of net sales was partially offset by an increase of 40 basis points in marketing expense, primarily due to media campaigns and content, as compared to Fiscal 2023.
The Company monitors financing market conditions and may in the future determine whether and when to amend, modify, repurchase, or restructure its ABL Facility and/or the Senior Secured Notes.
The Company believes that it will have adequate liquidity to fund operating activities for the next twelve months. The Company monitors financing market conditions and may in the future determine whether and when to repurchase shares of its Common Stock.
Refer to the discussion below in “ NON-GAAP FINANCIAL MEASURES ,” for further details on the comparable sales calculation. In light of store closures related to COVID-19, comparable sales for periods prior to Fiscal 2023 included in this Annual Report on Form 10-K are not disclosed. (3) Gross profit is derived from cost of sales, exclusive of depreciation and amortization.
Refer to the discussion below in “ NON-GAAP FINANCIAL MEASURES ,” for further details on the comparable sales calculation.
Operating Income Fiscal 2023 Fiscal 2022 (in thousands) % of Net Sales % of Net Sales BPS Change Operating income $ 484,671 11.3% $ 92,648 2.5% 880 Excluded items: Asset impairment charges (1) 4,436 0.1% 14,031 0.4% (30) Adjusted non-GAAP operating income $ 489,107 11.4% $ 106,679 2.9% 850 (1) Refer to “ NON-GAAP FINANCIAL MEASURES ,” for further details.
Operating Income Fiscal 2024 Fiscal 2023 (in thousands) % of Net Sales (1) % of Net Sales (1) BPS Change Americas $ 1,210,493 24.5 % $ 940,292 22.0 % 250 EMEA 109,821 2.2 81,216 1.9 30 APAC (12,011) (0.2) (10,558) (0.2) — Operating loss not attributed to segments (567,483) (11.5) (526,279) (12.3) 80 Operating income $ 740,820 15.0 $ 484,671 11.3 370 Excluded items: Asset impairment charges (2) — — 4,436 0.1 (10) Adjusted non-GAAP operating income $ 740,820 15.0 $ 489,107 11.4 360 (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.
Marketing, General and Administrative Expense Fiscal 2023 Fiscal 2022 (in thousands) % of Net Sales % of Net Sales BPS Change Marketing, general and administrative expense $ 642,877 15.0% $ 517,602 14.0% 100 For Fiscal 2023, marketing, general and administrative expense, as a percentage of net sales increased 100 basis points as compared to Fiscal 2022, primarily due to an increase in incentive compensation, marketing, the 53rd reporting week and digital and technology expenses.
General and administrative expense, as a percentage of net sales decreased 70 basis points as compared to Fiscal 2023. The decrease in expense rate was primarily driven by expense leverage from higher net sales, including 100 basis points in employee compensation costs, partially offset by 40 basis points in information technology expense.
Current Macroeconomic Conditions Macroeconomic conditions, including inflation, the geopolitical landscape, political uncertainty including elections in several countries, higher interest rates, foreign exchange rate fluctuations, and declines in consumer discretionary spending continue to negatively impact our business.
Current Macroeconomic Conditions Macroeconomic conditions, such as a volatile interest rate environment, ongoing inflation, the geopolitical landscape, and foreign exchange rate fluctuations, continue to impact the global economy. In addition, recent changes in legislation and regulations, including enacted and proposed tariffs and other trade policies, have introduced additional uncertainty in the global economy.
Removed
All prior periods presented are recast to conform to the new segment presentation. The Company’s brands include Abercrombie brands, which includes Abercrombie & Fitch and abercrombie kids, and Hollister brands, which includes Hollister and Gilly Hicks.
Added
In prior periods, the Company included stores and distribution expense and marketing, general and administrative expense as individual expense categories on the Consolidated Statements of Operations and Comprehensive Income (Loss). Stores & distribution expense was recaptioned as selling expense, while marketing, general and administrative expense was recaptioned as general and administrative expense.
Removed
Operate with financial discipline by: • actively managing inventory levels and positioning Abercrombie brands and Hollister brands to chase inventory as appropriate throughout the year; and • funding our growth strategies while properly balancing investments, impacts of inflation and efficiency efforts.
Added
In conjunction with these changes, all marketing expenses, including amounts previously presented in marketing, general and administrative expense, were moved into selling expense, while certain management and IT costs were moved out of stores and distribution expense and into general and administrative expense.
Removed
While freight costs have decreased in Fiscal 2023 and cotton costs waned towards the end of Fiscal 2023, there continues to be pricing volatility with respect to freight, cotton and other raw materials.
Added
The net changes associated with these reclassifications results in selling expense that is $38.3 million and $35.0 million lower than the stores and distribution expense that was previously presented for Fiscal 2023 and Fiscal 2022, respectively, and in general and administrative expense that is $38.3 million and $35.0 million higher than the marketing, general, and administrative expense that was previously presented for Fiscal 2023 and Fiscal 2022, respectively.
Removed
In addition, these macroeconomic conditions may result in delays in merchandise fulfillment and deliveries, increased costs to meet consumer demand (which we may not be able to pass on to customers through average unit retail (“AUR”)), or reduced consumer confidence.
Added
The Company’s strategic priorities continue to evolve based on changing consumer demands and new strategic opportunities, and management reviews and prioritizes investments and strategic focus areas to address such demands and opportunities.
Removed
Starting in late Fiscal 2023, disruptions to ocean vessels in the Red Sea have resulted in delayed deliveries to the EMEA region. Such disruptions have also led to increased freight costs, which could impact the Company in Fiscal 2024.
Added
Operate with financial discipline by: • using our agile inventory model and pricing strategies to position the Company to support customer demand throughout the year; and • maintaining our durable balance sheet and consistent free cash flow profile, underpinned by our disciplined investment philosophy while balancing against macro environment impacts and efficiency efforts.
Removed
Gross profit rate is is derived from cost of sales, exclusive of depreciation and amortization as a percentage of total net sales.
Added
The global supply chain also continues to be negatively impacted by various factors, including disruptions in major maritime routes, port congestion, higher operational costs, and increased competition for supply chain availability due to uncertainty regarding tariffs and trade policy.
Removed
The decrease was primarily attributable to approximately 340 basis points of higher average unit retail and approximately 300 basis points from the combination of lower freight costs and higher raw materials compared to Fiscal 2022. These benefits were partially offset by approximately 30 basis points from the adverse impact of exchange rates.
Added
The Company will continue to evaluate the impact as additional jurisdictions enact legislation and provide further guidance.
Removed
Gross Profit, Exclusive of Depreciation and Amortization Fiscal 2023 Fiscal 2022 % of Net Sales % of Net Sales BPS Change Gross profit, exclusive of depreciation and amortization $ 2,693,412 62.9% $ 2,104,538 56.9% 600 Abercrombie & Fitch Co. 35 2023 Form 10-K Table of Contents Stores and Distribution Expense Fiscal 2023 Fiscal 2022 (in thousands) % of Net Sales % of Net Sales BPS Change Stores and distribution expense $ 1,571,737 36.7% $ 1,496,962 40.5% (380) For Fiscal 2023, stores and distribution expense, as a percentage of net sales, decreased 380 basis points as compared to Fiscal 2022.
Added
High-single-digit growth in unit volume also contributed to the increase in net sales, following increases in traffic and transactions in Company-owned and operated channels.
Removed
The Company also has the ABL Facility available as a source of additional funding, which is described further below under “ Credit Facility and Senior Secured Notes” .

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Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeLipesky, Executive Vice President, Chief Financial Officer and Chief Operating Officer Age: 49 Executive Roles: • Executive Vice President, Chief Financial Officer and Chief Operating Officer of the Company (May 2023 to present) • Executive Vice President and Chief Financial Officer of the Company (April 2021 to May 2023) • Senior Vice President and Chief Financial Officer of the Company (October 2017 to April 2021) • Prior to rejoining the Company, formerly served as Chief Financial Officer of American Signature, Inc., a privately-held home furnishings company (October 2016 to October 2017) • Formerly held various leadership roles and finance positions with the Company (November 2007 to October 2016) including: Chief Financial Officer, Hollister Brand (September 2014 to October 2016); Vice President, Merchandise Finance (March 2013 to September 2014); Vice President, Financial Planning and Analysis (November 2012 to March 2013); and Senior Director, Financial Planning and Analysis (November 2010 to November 2012) • Former Corporate Finance Director with FTI Consulting Inc., a global financial services advisory firm • Former Director of Corporate Business Development with The Goodyear Tire & Rubber Company • Formerly held position as a Certified Public Accountant with PricewaterhouseCoopers LLP Samir Desai, Executive Vice President, Chief Digital and Technology Officer Age: 43 Executive Roles: • Executive Vice President, Chief Digital and Technology Officer of the Company (July 2021 to present) • Formerly held various leadership and technology positions at Equinox Group, a luxury fitness company that operates several lifestyle brands (October 2005 to June 2021), including: Chief Technology Officer (April 2016 to June 2021), Vice President, Technology (April 2013 to April 2016), Senior Director Technology (April 2011 to April 2013), Director Technology (October 2005 to April 2011) • Formerly held technology roles at Intertex Apparel Group, a manufacturer and importer of branded and private label apparel (July 2002 to October 2005), including Director, Information Technology Abercrombie & Fitch Co. 11 2023 Form 10-K Table of Contents Gregory J.
Biggest changeLipesky, Executive Vice President, Chief Operating Officer Age: 50 Executive Roles: • Executive Vice President, Chief Operating Officer of the Company (November 2024 to present) • Executive Vice President, Chief Financial Officer and Chief Operating Officer of the Company (May 2023 to November 2024) • Executive Vice President and Chief Financial Officer of the Company (April 2021 to May 2023); Senior Vice President and Chief Financial Officer of the Company (October 2017 to April 2021) • Prior to rejoining the Company, formerly served as Chief Financial Officer of American Signature, Inc., a privately-held home furnishings company (October 2016 to October 2017) • Formerly held various leadership roles and finance positions with the Company including: Chief Financial Officer, Hollister Brand (September 2014 to October 2016); Vice President, Merchandise Finance (March 2013 to September 2014); Vice President, Financial Planning and Analysis (November 2012 to March 2013); and Senior Director, Financial Planning and Analysis (November 2010 to November 2012) • Former Corporate Finance Director with FTI Consulting Inc., a global financial services advisory firm • Former Director of Corporate Business Development with The Goodyear Tire & Rubber Company • Formerly held position as a Certified Public Accountant with PricewaterhouseCoopers LLP Robert J.
OTHER INFORMATION A&F makes available free of charge on its website, corporate.abercrombie.com, under the “Investors – Financials/SEC Filings” section, its annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and amendments to those reports filed or furnished pursuant to Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), as soon as reasonably practicable after A&F electronically files such material with, or furnishes it to, the Securities and Exchange Commission (the “SEC”).
OTHER INFORMATION A&F makes available free of charge on its website, corporate.abercrombie.com, under the “Investors – Financials & Filings - SEC Filings” section, its Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and amendments to those reports filed or furnished pursuant to Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), as soon as reasonably practicable after A&F electronically files such material with, or furnishes it to, the Securities and Exchange Commission (the “SEC”).
The Company provides support to global organizations in the form of cash donations, volunteerism and in-kind support. In partnership with its vendor partners, customers and associates, the Company is proud to support community partners serving youth, teens, and young adults with a focus on mental health and wellness, empowerment, and inclusion and diversity.
The Company provides support to global organizations in the form of cash donations, volunteerism and in-kind support. In partnership with its vendor partners, customers and associates, the Company is proud to support community partners serving youth, teens, and young adults with a focus on mental health and wellness, empowerment, and inclusion.
The Company provides benefits-eligible associates and their families with access to free and confidential counseling through our Employee Assistance Program, as well as free access to Headspace, a mediation and mindfulness app. The Company also provides regular programming on financial planning and mental health.
The Company provides benefits-eligible associates and their families with access to free and confidential counseling through our Employee Assistance Program, as well as free access to a mediation and mindfulness app. The Company also provides regular programming on financial planning and mental health.
Henchel, Executive Vice President, General Counsel and Corporate Secretary Age: 56 Executive Roles: • Executive Vice President, General Counsel and Corporate Secretary of the Company (October 2021 to present) • Senior Vice President, General Counsel and Corporate Secretary of the Company (October 2018 to October 2021) • Former Executive Vice President, Chief Legal Officer and Secretary of HSN, Inc., a $3+ billion multi-channel retailer (February 2010 to December 2017) • Former Senior Vice President and General Counsel of Tween Brands, Inc., a specialty retailer (October 2005 to February 2010) and Secretary (August 2008 to February 2010) • Formerly held various roles at Cardinal Health, Inc., a global medical device, pharmaceutical and healthcare technology company, including Assistant General Counsel (2001 to October 2005), and Senior Litigation Counsel (May 1998 to 2001) • Formerly held position as a litigation associate with the law firm of Jones Day (September 1993 to May 1998) Jay Rust, Executive Vice President, Global Human Resources Age: 37 Executive Roles: • Executive Vice President, Global Human Resources of the Company (May 2023 to present) • Senior Vice President, Global Human Resources of the Company (March 2022 to May 2023) • Group Vice President, Interim Head of Global Human Resources of the Company (October 2021 to March 2022) • Vice President, Human Resources of the Company (June 2019 to October 2021) • Formerly held various leadership roles of increasing responsibility in the Company’s human resources department since February 2013, including roles supporting employee relations, learning and development, talent acquisition, and other human resources functions • Formerly held roles in the Company’s merchandising department GOVERNMENT REGULATIONS As a global organization, the Company is subject to the laws and regulations of the U.S. and multiple foreign jurisdictions in which it operates.
Henchel, Executive Vice President, General Counsel and Corporate Secretary Age: 57 Executive Roles: • Executive Vice President, General Counsel and Corporate Secretary of the Company (October 2021 to present) • Senior Vice President, General Counsel and Corporate Secretary of the Company (October 2018 to October 2021) • Former Executive Vice President, Chief Legal Officer and Secretary of HSN, Inc., a $3+ billion multi-channel retailer (February 2010 to December 2017) • Former Senior Vice President and General Counsel of Tween Brands, Inc., a specialty retailer (October 2005 to February 2010) and Secretary (August 2008 to February 2010) • Formerly held various roles at Cardinal Health, Inc., a global medical device, pharmaceutical and healthcare technology company, including Assistant General Counsel (2001 to October 2005), and Senior Litigation Counsel (May 1998 to 2001) • Formerly held position as a litigation associate with the law firm of Jones Day (September 1993 to May 1998) Jay Rust, Executive Vice President, Global Human Resources Age: 38 Executive Roles: • Executive Vice President, Global Human Resources of the Company (May 2023 to present) • Senior Vice President, Global Human Resources of the Company (March 2022 to May 2023) • Group Vice President, Interim Head of Global Human Resources of the Company (October 2021 to March 2022) • Vice President, Human Resources of the Company (June 2019 to October 2021) • Formerly held various leadership roles of increasing responsibility in the Company’s human resources department since February 2013, including roles supporting employee relations, learning and development, talent acquisition, and other human resources functions • Formerly held roles in the Company’s merchandising department GOVERNMENT REGULATIONS As a global organization, the Company is subject to the laws and regulations of the U.S. and multiple foreign jurisdictions in which it operates.
We also support our associates and their families beyond our competitive compensation with comprehensive benefits offerings, providing eligible associates with paid parental leave in the United States and internationally based on local law, as well as adoption and fertility support benefits to all eligible associates globally. • Improving associate engagement through open communication channels with a focus on development.
We also support our associates and their families beyond our competitive compensation with comprehensive benefits offerings, providing eligible associates with paid parental leave in the United States and internationally based on local law, as well as adoption and fertility support benefits to all eligible associates globally. • Improving associate engagement through open communication channels with a focus on associate experience.
The Company regularly holds all-company meetings to communicate with its associates. The Company also collects feedback through various engagement surveys to better understand associate experience and drive improvements, with the most recent organization-wide survey conducted in July 2023. • Fostering associate development by providing a wide variety of growth and development opportunities throughout associates’ careers.
The Company regularly holds all-company meetings to communicate with its associates. The Company also collects feedback through various engagement surveys throughout the year to better understand the associate experience and drive improvements, with the most recent organization-wide survey conducted in October 2024. • Fostering associate development by providing a wide variety of growth and development opportunities throughout associates’ careers.
Highlights of our key human capital management programs and efforts include the following: • Living a corporate purpose of “Being here for you on the journey to being and becoming who you are.” The Company’s corporate purpose was developed after conducting listening sessions with its associates and its customers, and by weaving in key themes from each of the brand purposes. • Offering competitive compensation and benefits , to help the Company attract, motivate, and retain the key talent necessary to achieve outstanding business and financial results.
Highlights of our key human capital management programs and efforts include the following: Abercrombie & Fitch Co. 8 2024 Form 10-K Table of Contents • Living a corporate purpose of “Being here for you on the journey to being and becoming who you are.” The Company’s corporate purpose was developed after conducting listening sessions with its associates and its customers, and by weaving in key themes from each of the brand purposes. • Offering competitive compensation and benefits to help the Company attract, motivate, and retain the key talent necessary to achieve outstanding business and financial results.
Set forth below is certain information regarding the executive officers of the Company as of April 1, 2024: Fran Horowitz, Chief Executive Officer and Director Age: 60 Executive Roles: • Chief Executive Officer, and member of the Board of Directors of the Company (February 2017 to present) • Former President and Chief Merchandising Officer for all brands of the Company (December 2015 to February 2017), former member of the Office of the Chairman of the Company (December 2014 to February 2017) and former Brand President of Hollister (October 2014 to December 2015) • Former President of Ann Taylor Loft, at that time a division of ANN Inc.
Set forth below is certain information regarding the executive officers of the Company as of March 31, 2025: Fran Horowitz, Chief Executive Officer and Director Age: 61 Executive Roles: • Chief Executive Officer, and member of the Board of Directors of the Company (February 2017 to present) • Former President and Chief Merchandising Officer for all brands of the Company (December 2015 to February 2017), former member of the Office of the Chairman of the Company (December 2014 to February 2017) and former Brand President of Hollister (October 2014 to December 2015) • Former President of Ann Taylor Loft, at that time a division of ANN Inc.
This includes stretch assignments, internal career pathing, self-awareness exercises, and active coaching. The Company also uses leadership standards to help associates identify the core behaviors essential for their career growth, as well as personal growth, on their journey at the Company.
This includes structured development programs, access to online skill development platforms, stretch assignments, internal career pathing, self-awareness exercises, and active coaching. The Company also uses leadership standards to help associates identify the core behaviors essential for their career growth, as well as personal growth, on their journey at the Company.
Abercrombie & Fitch Co. 10 2023 Form 10-K Table of Contents Board Oversight A&F’s Board of Directors (the “Board of Directors”) and its committees oversee human capital issues. The Compensation and Human Capital Committee of the Board of Directors oversees the Company’s overall compensation structure, policies and programs, as well as administration of our cash-based and equity-based performance award programs.
Board Oversight A&F’s Board of Directors (the “Board of Directors”) and its committees oversee human capital matters. The Compensation and Human Capital Committee of the Board of Directors oversees the Company’s overall compensation structure, policies and programs, as well as administration of the Company’s cash-based and equity-based performance award programs.
The Company’s compensation offerings include cash-based and equity-based incentive awards in order to align the interests of associates and stockholders. In addition, the Company continues to evolve its approach to work flexibility, including supporting remote work arrangements for key roles and “work from anywhere days and weeks” for our corporate home office associates where feasible.
The Company’s compensation offerings include cash-based and equity-based incentive awards in order to align the interests of associates and stockholders. In addition, the Company continues to provide hybrid and remote work arrangements for corporate home office associates where feasible, including “work from anywhere” days and weeks.
Abercrombie & Fitch Co. 12 2023 Form 10-K Table of Contents
Abercrombie & Fitch Co. 11 2024 Form 10-K Table of Contents
The Company also has policies and practices in place that are focused on creating a culture and work environment free from abuse, harassment or discrimination of any kind.
Therefore, the Company believes that the attraction, retention, and management of qualified talent are integral to its success. The Company has policies and practices in place that are focused on creating a culture and work environment free from abuse, harassment or discrimination of any kind.
Associates The Company employed approximately 31,700 associates globally as of February 3, 2024, of whom approximately 25,000 were part-time associates. As of February 3, 2024, the Company employed approximately 25,200 associates in the U.S., and employed approximately 6,500 associates outside of the U.S.
Associates The Company employed approximately 39,200 associates globally as of February 1, 2025, of whom approximately 32,600 were part-time associates. As of February 1, 2025, the Company employed approximately 31,400 associates in the U.S., and employed approximately 7,800 associates outside of the U.S.
The Company believes that the strength of its unique culture is a competitive advantage, and intends to continue building upon that culture to improve performance across its business.
HUMAN CAPITAL MANAGEMENT The Company strives to create a culture that drives strategic and key business priorities forward, while being welcoming and inclusive, encouraging associates to impact their global communities positively. The Company believes that the strength of its unique culture is a competitive advantage, and intends to continue building upon that culture to improve performance across its business.
Resources in support of these efforts include the Company’s internal job board, which empowers associates to apply for open roles and/or to seek advancement opportunities within the Company. • Embracing inclusion and diversity in all forms, including gender, race, ethnicity, disability, nationality, religion, age, veteran status, LGBTQIA+ status, and other factors.
Resources in support of these efforts include the Company’s internal job board, which empowers associates to apply for open roles and/or to seek advancement opportunities within the Company, as well as formalized talent reviews to discuss associate development opportunities. • Creating a culture of belonging and working to ensure that all our associates feel respected and represented.
Additionally, the Environmental, Social and Governance Committee of the Board of Directors oversees the Company’s strategies, policies and practices regarding social issues and trends, including inclusion and diversity initiatives, health and safety, and philanthropy and community investment matters. INFORMATION ABOUT OUR EXECUTIVE OFFICERS The Company’s executive officers serve at the pleasure of the Board of Directors.
Additionally, the Environmental, Social and Governance Committee of the Board of Directors is responsible for the oversight of risks associated with our environmental and social strategies. Abercrombie & Fitch Co. 9 2024 Form 10-K Table of Contents INFORMATION ABOUT OUR EXECUTIVE OFFICERS The Company’s executive officers serve at the pleasure of the Board of Directors.
Additionally, the Company invests in inclusion and diversity learning and development opportunities for associates on topics relating to the fundamentals of inclusion and diversity, including trainings, learning sessions, and workshops. • Encouraging community involvement of its associates by promoting various charitable, philanthropic, and social awareness programs, which the Company believes fosters a collaborative and rewarding work environment.
The Company follows core principles to embed a sense of community into our organization, including having a workforce that reflects the communities we serve, building a leadership team that is representative of our workforce, offering voluntary training and inviting all associates to participate in any of our various associate resource groups to promote inclusion and belonging, and driving fairness through our compensation and benefits offerings. • Encouraging community involvement of its associates by promoting various charitable, philanthropic, and social awareness programs, which the Company believes fosters a collaborative and rewarding work environment.
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Abercrombie & Fitch Co. 9 2023 Form 10-K Table of Contents HUMAN CAPITAL MANAGEMENT The Company strives to create a culture that drives strategic and key business priorities forward, while is also welcoming, inclusive, and diverse, and encourages associates to create a positive impact in their global communities.
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We believe that when we do this, we are stronger across every aspect of our business.
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Therefore, the Company believes that the attraction, retention, and management of qualified talent representing diverse backgrounds, experiences, and skill sets - and fostering a diverse, equitable, and inclusive work environment - are integral to its success.
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Ball, Senior Vice President, Chief Financial Officer Age: 45 Executive Roles: • Senior Vice President, Chief Financial Officer of the Company (November 2024 to present) • Senior Vice President, Corporate Finance, Investor Relations, and Treasury of the Company (May 2023 to November 2024) • Formerly held various finance and leadership positions with the Company including: Group Vice President, Corporate Finance and Transformation Management Office (August 2022 to May 2023); Vice President/Group Vice President, Corporate Finance (January 2018 to August 2022); and Chief Financial Officer, Abercrombie & Fitch and abercrombie kids Brand (September 2014 to January 2018) • Formerly held roles of increasing responsibility in the Company’s finance department, including roles in financial reporting, financial planning and analysis, and real estate accounting (January 2003 to September 2014) Samir Desai, Executive Vice President, Chief Digital and Technology Officer Age: 44 Executive Roles: • Executive Vice President, Chief Digital and Technology Officer of the Company (July 2021 to present) • Formerly held various leadership and technology positions at Equinox Group, a luxury fitness company that operates several lifestyle brands (October 2005 to June 2021), including: Chief Technology Officer (April 2016 to June 2021), Vice President, Technology (April 2013 to April 2016), Senior Director Technology (April 2011 to April 2013), Director Technology (October 2005 to April 2011) • Formerly held technology roles at Intertex Apparel Group, a manufacturer and importer of branded and private label apparel (July 2002 to October 2005), including Director, Information Technology Abercrombie & Fitch Co. 10 2024 Form 10-K Table of Contents Gregory J.
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The Company regularly reviews metrics including representation, retention, pay, and promotion among associates from diverse backgrounds, including those in leadership positions.
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The Company also encourages associates to enhance their understanding of inclusion and diversity through participating in the Company’s various associate resource groups, which allow associates from different business functions around the world to have discussions, attend activities, and receive materials focused on allyship, community, celebration, and education.

Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeOn July 2, 2020, the Company issued the Senior Secured Notes due in 2025 with an 8.75% fixed interest rate per annum and repaid all outstanding borrowings under the ABL Facility and its prior term loan facility, thereby eliminating any then existing cash flow market risk due to changes in interest rates.
Biggest changeOn July 2, 2020, the Company issued the Senior Secured Notes and repaid all outstanding borrowings under the Term Loan Facility and the ABL Facility, thereby eliminating any then-existing cash flow market risk due to changes in interest rates. On July 15, 2024, the Company redeemed all of its outstanding Senior Secured Notes, thereby eliminating that interest rate risk.
INTEREST RATE RISK Prior to July 2, 2020, the Company’s exposure to market risk due to changes in interest rates related primarily to the increase or decrease in the amount of interest expense from fluctuations in the LIBO rate, or an alternate base rate associated with the ABL Facility and the Company’s former term loan facility (the “Term Loan Facility”).
INTEREST RATE RISK Prior to July 2, 2020, the Company’s exposure to market risk due to changes in interest rates related primarily to the increase or decrease in the amount of interest expense from fluctuations in the LIBO rate, or an alternate base rate associated with the Company’s former term loan facility (the “Term Loan Facility”) and the ABL Facility.
On March 15, 2023, the Company entered into the First Amendment to the Amended and Restated Credit Agreement to eliminate LIBO rate based loans and to use the current market definitions with respect to the Secured Overnight Financing Rate (“SOFR”), as well as to make other conforming changes.
On March 15, 2023, the Company entered into the First Amendment to the Amended and Restated Credit Agreement to eliminate LIBO rate-based loans and to use the current market definitions with respect to the Secured Overnight Financing Rate, as well as to make other conforming changes.
For a detailed discussion of material risk factors that have the potential to cause our actual results to differ materially from our expectations, refer to “ ITEM 1A. RISK FACTORS ,” included in this Annual Report on Form 10-K. Abercrombie & Fitch Co. 44 2023 Form 10-K Table of Contents
For a detailed discussion of material risk factors that have the potential to cause our actual results to differ materially from our expectations, refer to “ ITEM 1A. RISK FACTORS ,” included in this Annual Report on Form 10-K. Abercrombie & Fitch Co. 44 2024 Form 10-K Table of Contents
In July 2017, the Financial Conduct Authority (the authority that regulates LIBO rate) announced it intended to stop compelling banks to submit rates for the calculation of LIBO rate after 2021. Certain publications of the LIBO rate were phased out at the end of 2021 and all LIBO rate publications will cease after June 30, 2023.
In July 2017, the Financial Conduct Authority (the authority that regulates LIBO rate) announced it intended to stop compelling banks to submit rates for the calculation of LIBO rate after 2021. Certain publications of the LIBO rate were phased out at the end of 2021 and all LIBO rate publications ceased after June 30, 2023.
The Company assessed the risk of loss in fair values from the effect of a hypothetical 10% devaluation of the U.S. dollar against the exchange rates for foreign currencies under forward contracts. Such a hypothetical devaluation would decrease derivative instrument fair values by approximately $9.0 million.
The Company assessed the risk of loss in fair values from the effect of a hypothetical 10% devaluation of the U.S. dollar against the exchange rates for foreign currencies under forward contracts. Such a hypothetical devaluation would decrease derivative instrument fair values by approximately $17.2 million.
FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA ” of this Annual Report on Form 10-K for the fair value of outstanding foreign currency exchange forward contracts included in other current assets and accrued expenses as of February 3, 2024 and January 28, 2023.
FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA ” of this Annual Report on Form 10-K for the fair value of outstanding foreign currency exchange forward contracts included in other current assets and accrued expenses as of February 1, 2025 and February 3, 2024.
Due to the short-term nature of these instruments, changes in interest rates are not expected to materially affect the fair value of these financial instruments. Refer to Note 9, “ RABBI TRUST ASSETS ,” of the Notes to Consolidated Financial Statements included in “ ITEM 8.
Due to the short-term nature of these instruments, changes in interest rates are not expected to materially affect the fair value of these financial instruments. Refer to Note 5, “ INVESTMENTS ,” of the Notes to Consolidated Financial Statements included in “ ITEM 8.
Item 7A. Quantitative and Qualitative Disclosures About Market Risk INVESTMENT SECURITIES The Company’s investment securities consist of cash equivalents in financial instruments, primarily money market funds and time deposits, with original maturities of three months or less.
Item 7A. Quantitative and Qualitative Disclosures About Market Risk INVESTMENT SECURITIES The Company maintains its cash equivalents in financial instruments, primarily time deposits and money market funds, with original maturities of three months or less. Recently, the Company invested in short-term marketable securities with maturities less than twelve months.
The Senior Secured Notes are exposed to interest rate risk that is limited to changes in fair value. This analysis for Fiscal 2024 may differ from actual results due to potential changes in gross borrowings outstanding under the ABL Facility and potential changes in interest rate terms and limitations described within the Amended and Restated Credit Agreement.
This analysis for Fiscal 2025 may differ from actual results due to potential changes in gross borrowings outstanding under the ABL Facility and potential changes in interest rate terms and limitations described within the ABL Credit Agreement.

Other ANF 10-K year-over-year comparisons