Abercrombie & Fitch posts mixed Q1 results; Middle East conflict hits sales but full-year growth expected

Abercrombie & Fitch reported mixed fiscal Q1 results with a 10% sales drop in its Europe, Middle East, and Africa region due to the Middle East conflict impacting its Hollister brand. Despite this, the company beat earnings expectations and expects total sales growth for Q2 and the full fiscal year 2026. However, its Q2 earnings guidance fell short of analyst estimates. The company also benefits from tariff reductions and expects a 3-5% net sales increase for the year, driven partly by new store openings and favorable currency effects rather than organic demand.