American Eagle reports strong sales, fuelled by Sydney Sweeney ad
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The company said it gained new shoppers in “every single county in the US” and saw sellouts of Sweeney’s signature jeans.
PHOTO: AFP
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NEW YORK - American Eagle Outfitters wanted actress Sydney Sweeney to be a brand reset. It worked.
The apparel company saw shares soar 25 per cent in postmarket trading on Sept 3 after it reported higher-than-expected quarterly sales and cited the success of its controversial ad campaign featuring the star, which ignited a social media firestorm.
“In just six weeks, the campaign has generated unprecedented new customer acquisition,” chief marketing officer Craig Brommers said in a call with analysts.
He said the company gained new shoppers in “every single county in the US” and saw sellouts of her’s signature jeans.
For the second quarter ended Aug 2, American Eagle reported same-store sales down 1 per cent, surpassing the average analyst estimate compiled by Bloomberg. Revenue also outpaced expectations.
The company said it expects its mitigated tariff impact to be US$20 million (S$25.8 million) in this quarter, and between US$40 million to US$50 million in the fourth quarter.
American Eagle has faced steep competition from rivals including Gap, Levi Strauss & Co and Abercrombie & Fitch, with sales falling for four quarters straight on an annual basis.
The apparel company has tried to reignite excitement with buzzy, celeb-driven ads.
Launched in July, its “Sydney Sweeney has great jeans” campaign faced swift backlash, with some accusing the company of referencing eugenics.
The attention captured the interest of US President Donald Trump, who called it the “HOTTEST ad out there” in a post on Truth Social.
American Eagle also tied up with National Football League player Travis Kelce’s clothing brand Tru Kolors for a limited edition apparel line-up, creating buzz among shoppers as the news followed his engagement to pop star Taylor Swift.
It had previously entered into partnerships with tennis player Coco Gauff and actress Jenna Ortega, eyeing Gen Z shoppers.
The company’s focus on the younger demographic comes at a time when US holiday spending is expected to see its steepest drop since the Covid-19 pandemic as shoppers – particularly Gen Z – pull back amid economic uncertainty, according to a PwC survey.
Despite the success American Eagle attributed to the Sweeney ad, weekly year-over-year sales growth has slowed since around the July 23 launch, similar to trends from competitors, according to credit and debit card transaction data compiled by Bloomberg Second Measure.
GlobalData managing director Neil Saunders said that overall, sales “remain weak” at American Eagle, but the business is regaining traction.
“The controversy around the Sydney Sweeney denim campaign proved to be something of a tempest in a teacup,” he said. “While it generated strong reactions, it ultimately had no serious detrimental impact on sales. Indeed, guidance for the second half points to improved momentum.” BLOOMBERG, REUTERS
