American Eagle Outfitters (NYSE:AEO) has been making some strategic moves to improve its business inflow. The company recently filed its 2Q2015 report and managed to register positive growth for the third consecutive quarter. In total the company has experienced a rise of 12.8% in its share price, since the start of this year. Furthermore, AEO has also made some progress with respect to its omni-channel platform, to fill in the deficit from the drop in store sales.
Online shopping has been a bit of a menace for the US apparel industry, since it has led to a downfall of in store sales. However, even though retailers have made e-commerce websites to improve their market shares, but even the combined customer traffic from both mediums is not as large as it was before the advent of online shopping. Furthermore, the big problem here is actually the fact that American retailers have huge stores to maintain and if the store is not getting enough customers traffic, then it would turn to a bad investment.
The omni-channel initiative tends to counter this problem, by converting online sales to in store sales. The new platform will direct the web traffic to the nearest company outlet, which would cut down on shipping time and also improve in store sales for the company. For AEO, this translates to better inventory management and fewer markdowns.
This helped the company to report revenues of $797 million for the 2Q2015. This was an improvement of 12%, as compared to the same period in the preceding year. Additionally, the company was able to report an 11% increase in sales, after a 7% decline in the same period in the preceding year. Furthermore, the net income for the quarter stood at $33.3 million, bringing the diluted EPS to $0.17, compared to a mere $0.03 in the previous year.
American Eagle Outfitters (NYSE:AEO) gained 3.47% during the September 17 session, after trading a total of 10.51 million shares, to reach a close at $16.25 per share.
