We use cookies to understand how you use our site and to improve your experience.
This includes personalizing content and advertising.
By pressing "Accept All" or closing out of this banner, you consent to the use of all cookies and similar technologies and the sharing of information they collect with third parties.
You can reject marketing cookies by pressing "Deny Optional," but we still use essential, performance, and functional cookies.
In addition, whether you "Accept All," Deny Optional," click the X or otherwise continue to use the site, you accept our Privacy Policy and Terms of Service, revised from time to time.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
URBN said Nuuly Q3 revenue jumped 49%, driven by a 42% rise in average active subscribers.
URBN noted Nuuly added about 3.5 points to total revenue growth as subscribers neared 400,000.
URBN expects Nuuly to deliver healthy double-digit revenue growth again in the fourth quarter.
Urban Outfitters, Inc.’s (URBN - Free Report) Nuuly, its subscription-based apparel rental platform, continued to gain strong momentum during the third quarter of fiscal 2026, delivering solid growth in both subscribers and revenue while maintaining healthy operating profitability. The company reported robust overall results, with total revenue increasing 12% and net income rising 13%.
Nuuly’s revenue jumped 49% year over year, driven mainly by a 42% increase in average active subscribers, which reached just under 400,000 compared with the prior-year period. This strength contributed roughly 3.5 percentage points to URBN’s total revenue growth. Management remains focused on scaling the Nuuly platform and strengthening brand visibility, supported by continued investments in logistics and strategic marketing. The company noted that its planned logistics expansion in Kansas City, Missouri, including increased storage capacity and new sortation automation, remains on track.
Customer engagement across Urban Outfitters stayed strong, evidenced by sharp gains in both store traffic and online sessions. Shoppers responded positively to Nuuly’s appealing merchandise selection and unique brand experience, helping propel record third-quarter results. This consistent performance highlights the strength, resilience, and scalability of URBN’s diversified business model.
Nuuly’s continued outperformance underscores the large and growing opportunity within the U.S. apparel rental market. Management believes current investments are well-positioned to sustain momentum and support further market share growth. Overall, Nuuly’s accelerating growth is becoming a significant driver of Urban Outfitters’ revenue momentum, and according to the current plans, Nuuly is expected to generate healthy double-digit revenue growth in the fourth quarter, reflecting confidence in demand trends and the platform’s long-term scalability.
URBN Faces Competition From American Eagle & Boot Barn
American Eagle Outfitters, Inc. (AEO - Free Report) in the third quarter of fiscal 2025 delivered a total net revenue of $1.36 billion, representing a 6% increase compared with the prior year, and a 4% year-over-year increase in total comparable sales. American Eagle’s gross profit rose 5% year over year to $552 million from $527 million. However, gross margin declined 40 basis points to 40.5.
Boot Barn Holdings, Inc. (BOOT - Free Report) in the second quarter of fiscal 2026, posted net sales growth of 18.7% year over year to $505.4 million from $425.8 million in the prior-year period, and consolidated same-store sales grew 8.4% year over year. Boot Barn’s gross profit increased to $184.1 million, representing 36.4% of net sales, from $152.9 million, or 35.9% in the prior year. The expansion in gross profit was primarily driven by higher sales volumes and improved merchandise margins.
Image: Bigstock
Nuuly's Strong Revenue Growth Powers Urban Outfitters Momentum
Key Takeaways
Urban Outfitters, Inc.’s (URBN - Free Report) Nuuly, its subscription-based apparel rental platform, continued to gain strong momentum during the third quarter of fiscal 2026, delivering solid growth in both subscribers and revenue while maintaining healthy operating profitability. The company reported robust overall results, with total revenue increasing 12% and net income rising 13%.
Nuuly’s revenue jumped 49% year over year, driven mainly by a 42% increase in average active subscribers, which reached just under 400,000 compared with the prior-year period. This strength contributed roughly 3.5 percentage points to URBN’s total revenue growth. Management remains focused on scaling the Nuuly platform and strengthening brand visibility, supported by continued investments in logistics and strategic marketing. The company noted that its planned logistics expansion in Kansas City, Missouri, including increased storage capacity and new sortation automation, remains on track.
Customer engagement across Urban Outfitters stayed strong, evidenced by sharp gains in both store traffic and online sessions. Shoppers responded positively to Nuuly’s appealing merchandise selection and unique brand experience, helping propel record third-quarter results. This consistent performance highlights the strength, resilience, and scalability of URBN’s diversified business model.
Nuuly’s continued outperformance underscores the large and growing opportunity within the U.S. apparel rental market. Management believes current investments are well-positioned to sustain momentum and support further market share growth. Overall, Nuuly’s accelerating growth is becoming a significant driver of Urban Outfitters’ revenue momentum, and according to the current plans, Nuuly is expected to generate healthy double-digit revenue growth in the fourth quarter, reflecting confidence in demand trends and the platform’s long-term scalability.
URBN Faces Competition From American Eagle & Boot Barn
American Eagle Outfitters, Inc. (AEO - Free Report) in the third quarter of fiscal 2025 delivered a total net revenue of $1.36 billion, representing a 6% increase compared with the prior year, and a 4% year-over-year increase in total comparable sales. American Eagle’s gross profit rose 5% year over year to $552 million from $527 million. However, gross margin declined 40 basis points to 40.5.
Boot Barn Holdings, Inc. (BOOT - Free Report) in the second quarter of fiscal 2026, posted net sales growth of 18.7% year over year to $505.4 million from $425.8 million in the prior-year period, and consolidated same-store sales grew 8.4% year over year. Boot Barn’s gross profit increased to $184.1 million, representing 36.4% of net sales, from $152.9 million, or 35.9% in the prior year. The expansion in gross profit was primarily driven by higher sales volumes and improved merchandise margins.
The Zacks Rundown for URBN
Urban Outfitters’ shares have gained 8.6% in the past six months compared with the industry’s rise of 12%. URBN presently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Image Source: Zacks Investment Research
From a valuation standpoint, URBN trades at a forward price-to-earnings ratio of 13.35, lower than the industry’s average of 16.51.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for URBN’s current year and next year earnings estimates indicates year-over-year growth of 29.8% and 9.6%, respectively.
Image Source: Zacks Investment Research