PITTSBURGH, September 12 — American Eagle Outfitters, Inc. (NYSE: AEO) reported second-quarter results for the period ended August 1, 2026, in a press release dated September 9, and the headline number investors will note is the $196 million in tariff refunds the company received during the quarter. Those refunds, tied to International Emergency Economic Powers Act claims, came with interest and benefited the quarter’s results. The net operating income benefit was $161 million.
The company said it has now received substantially all of the refunds for which it submitted claims.
Incentive Costs and Interest Expense
Two offsets followed the refunds. AEO accrued $35 million in incremental incentive compensation, a charge that hit both gross profit and SG&A expenses. Separately, the company recorded $45 million in interest expense tied to an agreement with a third-party buyer for the sale of certain tariff refund claims, a deal entered into during the prior fiscal year.
Inventory is the other figure that matters. Consolidated inventory at cost rose 14%, with units up 9%.
The cost increase includes the impact of incremental tariffs in 2026. Management said unit inventory plans will continue to be rebalanced between brands and categories for the remainder of the year.
Brand Momentum and the Women’s Business
Executive Chairman and Chief Executive Officer Jay Schottenstein framed the quarter around the portfolio. He said the results reflect the value of the AEO Inc. portfolio, led by broad-based momentum at Aerie and OFFLINE, alongside encouraging progress at American Eagle. On American Eagle specifically, Schottenstein pointed to sequential improvement from the first quarter, including a fourth consecutive quarter of growth in men’s.
He said the company remains focused on opportunities to drive greater consistency in the women’s business. Aerie’s expansion remains a priority.
Schottenstein said the company continues to expand Aerie’s reach and deepen brand awareness, leveraging authentic connections to attract new customers and fuel engagement.
Capital Returns and What to Watch
AEO returned $21 million to shareholders during the quarter through a quarterly cash dividend of $0.125 per share, paid to shareholders of record as of July 10, 2026. Capital expenditures totaled $66 million, and the company expects 2026 capital expenditures in the range of $250 to $260 million. Looking to the second half, Schottenstein said the company is committed to building on continued momentum in Aerie and OFFLINE, accelerating improvement at American Eagle, and unlocking greater consistency and profitability across the business.
AEO operates stores in the United States, Canada and Mexico, sells merchandise in more than 30 countries through license partners, and runs e-commerce across its brands, a portfolio that includes American Eagle, Aerie, OFFL/NE by Aerie, Todd Snyder and Unsubscribed. Management hosted a conference call on the announcement day at 4:30 p.m. Eastern Time, with a webcast and audio replay available and a financial results presentation posted to the Investor Relations section of www.aeo-inc.com.
The release carries a safe harbor for forward-looking statements under the Private Securities Litigation Reform Act of 1995, covering expected results for the third quarter and full-year fiscal 2026, and points to risks disclosed in Item 1A of the company’s Annual Report on Form 10-K for the fiscal year ended January 31, 2026, and in other SEC filings. All guidance is based on estimates and includes the impact of the IEEPA tariff refunds. Watch whether the inventory rebalancing and the women’s business move in the direction management has laid out.
