Retailer American Eagle Outfitters (NYSE:AEO) reported first-quarter financial results Thursday after market close.

Here are the highlights.

• American Eagle Outfitters stock is among today’s weakest performers. Why is AEO stock dropping?

American Eagle Q1 Financials

American Eagle reported first-quarter revenue of $1.2 billion, up 10% year-over-year. The revenue total beat a Street estimate of $1.19 billion, according to data from Benzinga Pro.

The quarterly revenue total marked a first-quarter record for the company.

The Aerie unit had record first-quarter revenue with comps up 25%. On a trailing 12-month basis, the brand had revenue of more than $2 billion.

Overall, comparable sales were up 8% year-over-year in the quarter, with American Eagle brand comp sales down 2% year-over-year.

American Eagle reported adjusted earnings of 14 cents per share, beating a Street consensus estimate of 12 cents per share.

"We entered 2026 with strong momentum, delivering double-digit top-line growth and operating income ahead of guidance," American Eagle CEO Jay Schottenstein said. "This quarter reflected the strength of our portfolio and the power of Aerie."

The company said inventory was up 27% year-over-year to $817 million at the end of the third quarter, with units up 5%. The higher inventory costs are said to be related to the impact of tariffs for this year and the comparison of an inventory write-down in the last fiscal year.

Higher inventory and the comp decline for the American Eagle brand could be leading shares lower.

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What's Next for American Eagle

American Eagle is guiding for second-quarter comp sales to be up mid-to-high single-digits. Full-year comp sales are expected to be up mid-single digits.

The company reiterated its 2026 operating income guidance of $390 million to $410 million. Second-quarter operating income is expected to be in the range of $45 million to $50 million.

"We remain confident in our ability to navigate near-term headwinds," Schottenstein said. "We are focused on operational excellence and disciplined execution to drive long-term value for AEO and our shareholders."

American Eagle Stock Price Action

American Eagle stock is down 11.83% to $15.80 in after-hours trading Thursday, versus a 52-week trading range of $9.27 to $28.46.

Read Also: Sydney Sweeney Can't Hide American Eagle's Deep Discount As The Stock's Value Score Climbs

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