Urban Outfitters Inc. shares sank Tuesday after the retailer reported disappointing sales at its namesake chain.
The Philadelphia-based company owns the Urban Outfitters, Anthropologie, Free People, Bhldn and Terrain brands.
Urban Outfitter said late Monday that revenue from stores open at least a year was flat in its most recent quarter. It saw a 25 percent gain at Free People and 8 percent increase at its Anthropologie unit, but this key sales measure fell 12 percent at its biggest brand — Urban Outfitters.
This is considered a critical indicator of performance and financial health as it measures revenue at stores open at least a year and excludes recently opened or closed sites.
Urban Outfitters targets younger shoppers, who can be quite fickle in their tastes. And CEO Richard Hayne said that the chain is working to "regain its fashion footing."
KeyBanc Capital Markets analyst Edward Yruma characterized the quarter as two steps forward and one step back for the company, given the gains at two of its brands. He said in a research note that Urban may roll out some product changes this fall but the brand's weakness will continue to weigh on the company in its second quarter.
The company also reported Monday that it earned $37.5 million, or 26 cents per share, for its first fiscal quarter, down from $47.1 million, or 32 cents per share, last year. That was a penny per share short of market forecasts. Its total revenue for the quarter increased 6 percent to $686.3 million from $648.2 million. That exceeded market forecasts for revenue of $680.2 million, according to FactSet.
Shares fell $3.06, a nearly 8.5 percent decline, to $33.11 by midafternoon Tuesday. Its shares were down about 19 percent for the year as of Monday's close.
Urban Outfitters was one of a number of retail outlets that declined in afternoon trading. Others included Gap. Inc., American Eagle Outfitters Inc. and Abercrombie & Fitch Co.