Urban Outfitters (URBN) reported a 86% jump in earnings for the second quarter driven by higher revenue, lower markdowns at all three brands and strong retail segment comparable sales. The top and bottom line exceeded analysts’ expectations. Following this, the stock rose more than 2% in the after-hours session.
Earnings climbed by 86% to $92.8 million or $0.84 per share. Revenue increased by 13.7% to $992 million helped by double-digit growths in comp sales and digital channel sales. Comparable retail segment sales rose by 13% and wholesale sales increased by 10%.
The spike in comparable retail segment net sales was primarily driven by strong double-digit growth in the digital channel and positive retail store sales. At Free People, comparable retail sales rose 17%, while at Anthropologie Group it increased 11%. For Urban Outfitters, comp sales improved 15%.
Sales at all major segments saw double-digit increases for the quarter. However, the Food and Beverage segments, which the company had ventured into to overcome the ever-expanding retail competition, saw a 15% decline in sales year-over-year.
The board of directors authorized the buyback of 20 million common shares under a share repurchase program, of which 17.9 million common shares were remaining as of July 31, 2018.
For the six months ended July 31, 2018, Urban Outfitters opened a total of seven new locations including three Free People stores, two Urban Outfitters stores, and two Anthropologie Group stores. It closed two locations including one Urban Outfitters store and one Anthropologie Group store.
Urban Outfitters stock had rallied over 152% in the past year and has jumped more than 36% since January. Shares of the company ended Tuesday’s regular trading session up by 0.48% at $47.74 on the Nasdaq.