Urban Outfitters, Inc. Q3 FY2026 earnings call

• Frank Conforti noted Q3 record results, brands had positive comps across geographies, Nuuly had double - digit revenue growth, wholesale had 8% revenue increase, gross profit was up 13% to $563 million with 36.8% rate. - Tricia Smith spoke about Anthropologie Group's 8% retail segment comparable sales increase, 19th consecutive quarter of positive comps, launch of Maeve concept with positive results, home business acceleration. - Melanie Marein - Efron discussed fourth - quarter financial performance plans, inventory growth, capital expenditures, and store opening/closing plans.

Total Urban Outfitters, Inc. sales grew by over 12% to $1.5 billion in Q3. All Retail segment brands had positive comps; four of five brands had record third - quarter sales. Nuuly had 49% revenue growth with 118,000 more average active subscribers. Wholesale segment had 8% revenue growth. Urban Outfitters brand had 13% global retail segment comp, with North America 10% and Europe 17%. Free People brand had 9% total revenue growth. Anthropologie Group had 8% retail segment comparable sales increase.

• Total company sales expected to grow in high single digits in Q4. - Retail segment comp sales could be mid - single - digit positive, with Urban Outfitters brand at high single - digit, Anthropologie at mid - single - digit, Free People at low to mid - single - digit. Nuuly could have mid - double - digit revenue growth. Wholesale segment could have mid - single - digit growth. Full - year gross profit margins could increase by approx 100 basis points, fourth - quarter gross profit margins could increase by 25 - 50 basis points. SG&A expenses expected to grow roughly in line with sales. Plan to open ~69 new stores and close ~17 this year.

• Tariffs negatively impacted third - quarter gross margin rate by ~60 basis points and expected to impact fourth - quarter by ~75 basis points. Uncertainty in tariff impact beyond fourth quarter due to ongoing mitigation efforts and current environment. - Red Sea shipping lane situation could impact shipping rates, but early to speculate exact impact.

Q: Follow up on pricing, how much customer reaction to price increases and protection of opening price points?

A: Highly strategic and thoughtful about price, little price resistance, committed to maintaining opening price points.

Q: On own brand penetration and Anthropologie global footprint, and UO segment margin year to date?

A: Own brand penetration grew, Anthropologie opening stores in UK, UO brand was profitable globally in Q3 with progress in North America.

Q: Drivers of business in third quarter and holiday outlook, margin drivers long - term?

A: Traffic in stores and online were drivers, holiday likely good but more promotional, long - term margin target with multiple levers.

Q: Gross margins in Q3, offsets for Q4 guidance, and Nuuly subscriber growth impact on margin?

A: Q3 outperformance due to top line, Q4 guidance with conservative improvement, Nuuly subscriber growth sales have lower gross profit but no major demographic shift impact.

Q: Long - term margin target and Anthro business structural change?

A: Target 10% margin, Anthro business changed by modernizing product, diversifying categories, investing in digital, etc.

Q: Consumer waiting for promotions, Nuuly subscriber growth impact on margin?

A: Consumer waiting for promotions is normal, Nuuly subscriber growth sales have lower gross profit but no major demographic shift.

Q: UO recovery, men's business in Urban, and pricing strategy?

A: UO recovery with focus on customer, men's business growing, pricing strategy focused on customer response.

Q: Wholesale business and Red Sea shipping lane impact?

A: Wholesale business doing well, Red Sea shipping lane if improved would be positive for margins