Canadian clothing retailer Aritzia (TSE:ATZ) has reported blockbuster financial results as an aggressive expansion into the U.S. begins to payoff for the company.
Elevate Your Investing Strategy:
- Take advantage of TipRanks Premium at 50% off! Unlock powerful investing tools, advanced data, and expert analyst insights to help you invest with confidence.
Vancouver-based Aritzia reported earnings per share (EPS) of $0.36, which was up 157% from $0.14 a year earlier. Revenue in what was the company’s Fiscal first quarter totaled $663.3 million, a year-over-year increase of 33%. In-store sales came in at $480.3 million, up 34.2% from a year ago, while e-commerce revenue climbed 30% to $183 million.
Management at Aritzia said the strong results reflect the company’s ongoing push into the U.S. market, where it opened 13 boutiques over the past year. Aritzia estimates that its U.S. customer base increased by 40% year-over-year in the most recent quarter and its net revenue coming from America gained 45% to $413 million in Fiscal Q1 from the same period in 2024.
What Trade War?
In releasing the latest financial results, management at Aritzia said the ongoing trade tensions between the U.S. and Canada, as well as tariffs imposed by U.S. President Donald Trump are not having a negative impact on the company’s sales or profits. “We still have a long runway for growth in the United States,” said Aritzia CEO Jennifer Wong on an earnings call with analysts and media.
Wong estimates that about 40% of Aritzia’s business is not impacted by tariffs because it falls outside of the American market. Still, Aritzia is vulnerable to tariffs imposed on China, where it manufactures much of its clothing. In response, Aritzia has been moving away from manufacturing in China. By 2026, the portion of products Aritzia sells that are made in China is expected to be in the mid-single digits.
ATZ stock has gained 43% this year.
Is ATZ Stock a Buy?
The stock of Aritzia has a consensus Strong Buy rating among 11 Wall Street analysts. That rating is based on 11 Buy recommendations issued in the last three months. The average ATZ price target of $78.91 implies 3.75% upside from current levels. These ratings may change after the company’s latest financial results.
