American Eagle Outfitters announced financial results for the first quarter ended April 30, 2022.
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Total net revenue increased $20 million, or 2% to $1.055 billion, compared to $1.035 billion in the first quarter of 2021. Our supply chain acquisitions contributed approximately 3 percentage points to revenue growth.
Aerie revenue of $322 million rose 8% reflecting a 27% 3-year revenue CAGR. American Eagle revenue of $686 million declined 6% versus first quarter 2021 reflecting a -2% 3-year revenue CAGR.
Consolidated store revenue increased 2%. Total digital revenue declined 6%. Compared to pre-pandemic first quarter 2019, store revenue increased 1% and digital revenue increased 48%.
Gross profit of $388 million declined 11% from $436 million in the first quarter of 2021 and reflected a gross margin rate of 36.8% compared to 42.2% last year. Higher freight costs impacted the gross margin by approximately 340 basis points and our supply chain business had a 120 basis point impact as we integrate and ramp up the platform. Delivery and rent also increased, offset slightly by lower incentive compensation accruals.
Selling, general and administrative expense of $299 million increased 13%. SG&A increased 270 basis points as a rate to sales versus first quarter 2021 primarily due to increased store wages and hours, corporate compensation, professional services and advertising partially offset by lower incentive compensation accruals.
Operating income of $42 million included $35 million from higher freight costs and a $12 million loss from the supply chain acquisitions and compared to operating income of $133 million in the first quarter of 2021.
Average diluted shares outstanding were 220 million, compared to 207 million in the first quarter of 2021. The increase primarily reflected 49 million shares of unrealized dilution associated with the company’s convertible notes, consistent with the required adoption of ASU 2020-06 this quarter, compared to 34 million shares in the first quarter of 2021.
EPS of $0.16 includes an approximately $3 million addback to net income of interest expense associated with the company’s convertible notes, in-line with the adoption of ASU 2020-06 this quarter. ■