Mon, Jun 9, 8:19 PM (9 days ago)
**Urban Outfitters, Inc. (URBN) Q1 2026 Financial Summary** **Financial Health and Performance:** - **Revenue:** $1,329.5 million, up 10.8% YoY, driven by increases in Retail (6.4%), Subscription (59.5%), and Wholesale (24.2%) segments. - **Profit Margins:** Gross margin improved to 36.8% from 34.0% YoY, due to better markdowns, delivery expense leverage, and store occupancy cost leverage. Operating margin increased to 9.6% from 6.2% YoY. - **Cash Flow:** Operating cash flow was $33.0 million, down from $58.6 million YoY, due to timing of disbursements. Financing cash outflows were $176.3 million, primarily due to share repurchases. - **Earnings:** Net income increased to $108.3 million, up 75.4% YoY. Earnings per share (EPS) were $1.18 (basic) and $1.16 (diluted), up from $0.66 and $0.65 YoY, respectively. **Segment Performance:** - **Retail:** Net sales increased by 6.4%, with comparable net sales up 6.9% at Anthropologie, 3.1% at Free People, and 2.1% at Urban Outfitters. Digital channel sales growth was driven by increased sessions, conversion rate, and units per transaction. - **Subscription:** Net sales surged by 59.5%, driven by a 52.9% increase in active subscribers. - **Wholesale:** Net sales increased by 24.2%, primarily due to higher sales to specialty customers and department stores. **Trends and Uncertainties:** - **Macroeconomic Environment:** Tariffs, inflation, and geopolitical events pose risks to global economic conditions and consumer spending. - **Store Growth:** Urban Outfitters plans to open 64 new stores in fiscal 2026, with a focus on domestic and international expansion. - **Digital Growth:** The company continues to invest in digital sales channels and technology advancements to enhance the customer experience. **Future Operations Impact:** - **Capital Expenditures:** Urban Outfitters plans to invest approximately $240 million in fiscal 2026, focusing on store expansion, technology, distribution network, and home office expansion. - **Share Repurchases:** The company repurchased 3,274,260 shares in Q1 2026, with 14,682,130 shares remaining under the program. **Conclusion:** Urban Outfitters delivered strong Q1 2026 results, with impressive revenue growth, improved profit margins, and increased earnings. The company's strategic investments in digital channels, store expansion, and technology position it for continued growth. However, macroeconomic uncertainties and geopolitical events may impact future performance.