Abercrombie is closing 60 stores in 2018
- Abercrombie & Fitch reported strong sales growth in the fourth quarter of 2017.
- This growth was driven by greater investment in stores, marketing, and omnichannel experiences.
- The company confirmed it would be closing up to 60 of its Abercrombie & Fitch and Hollister stores in 2018.
Abercrombie & Fitch is bouncing back by cutting stores.
The teen retailer has struggled in recent years. In 2016, the company's operating income plummeted to $15.2 million - down from $72.8 million in 2015 - and closed 54 stores.
On Wednesday, the company was praised by analysts after it announced positive same-store sales growth in its fourth-quarter results. Same-store sales were up 9% overall at the company, boosted by 11% growth at Hollister and 5% at the Abercrombie brand itself.
However, the company also announced it would be closing up to 60 Abercrombie and Hollister stores in 2o18.
The company has made a significant investment in its stores over the past year. In 2017, it created seven new Abercrombie prototype stores, downsized 16 of its stores, and closed 39.
On a call with investors on Wednesday morning, CFO Joanne Crevoiserat said that growth in the quarter was driven by strong direct-to-consumer sales and better traffic in stores.
"The physical store still serves an important role for a customer journey from a brand experience," Crevoiserat said.
The company has closed more than 400 stores since 2010, and 60% of its leases are expiring over the next 10 years, Crevoiserat said.
The company has not yet confirmed which stores would be closing.