March 4, 2026 – Abercrombie & Fitch (ANF) on Wednesday projected muted sales growth for the year, factoring in the impact of a 15% U.S. tariff and warning of a “slight sales hit” from the ongoing conflict in the Middle East. Shares fell 7% in early trading.

The retailer, which operates around 17 stores in the UAE and Kuwait, is among consumer companies navigating uncertainty after U.S. tariff changes. Following the Supreme Court striking down previous levies, the U.S. introduced a 10% uniform tariff, with Treasury Secretary Scott Bessent indicating a 15% rate could take effect this week.

Abercrombie now anticipates a 70-basis-point tariff impact, equivalent to roughly $40 million, based on 2025 sales of $5.27 billion. This is lower than its January estimate of $90 million, or a 170-basis-point hit, as the company has diversified its supply chain to mitigate tariff costs.

The company is also pursuing strategies to preserve margins, including:

• Selling products at full price and reducing discounts.
• Focusing on its core middle- to high-income consumers.
• Continuing supply chain diversification to offset global trade uncertainties.

“Abercrombie’s growth streak has been remarkable, but weakening momentum—particularly for its namesake brand—shows that the retailer is not immune to pressures on discretionary spending,” said Rachel Wolff, analyst at eMarketer.

For 2026, Abercrombie forecasts:

• Net sales growth: 3–5% (analysts expected 4.2%)
• Annual net income per share: $10.20–$11, with the midpoint above the consensus estimate of $10.36
• Store expansion: Around 30 new outlets globally

The company expects a minor tariff-related impact in Q2, with pressures easing later in the year and potential benefits as duties fall toward the end of 2026.

With over 830 stores worldwide, Abercrombie continues to navigate geopolitical risks and trade policy shifts while maintaining a cautious growth outlook.