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How Retail, Wholesale & Nuuly Are Supporting URBN's Growth Momentum
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Key Takeaways
URBN grew revenues 11.4% to $1.48 billion, supported by retail, wholesale and subscription gains.
URBN's Wholesale segment revenues increased 24.8% as demand from specialty retail partners improved.
URBN's subscription revenues rose 34.5%, driven by growth in average active subscribers.
Urban Outfitters Inc. (URBN - Free Report) continues to benefit from the strength of its diversified operating model, with its Retail, Wholesale and Subscription businesses each contributing meaningfully to growth. By generating revenues through stores, digital channels, wholesale partnerships and its rapidly expanding Nuuly rental platform, the company has built a balanced business that is helping drive consistent performance across varying consumer spending environments.
The strategy delivered another strong quarter. In the first quarter of fiscal 2027, URBN reported record revenues of $1.48 billion, an increase of 11.4% from the prior-year period, marking its seventh consecutive quarter of record sales and earnings. Retail remained the company's largest business, with segment sales rising 8% to $1.22 billion. Comparable retail sales increased 5.6%, supported by high-single-digit growth in digital sales and mid-single-digit growth in store sales, highlighting healthy customer engagement across channels.
Wholesale provided a significant boost to overall performance. Segment revenues climbed 24.8% to $93.2 million, driven primarily by strong demand for FP Group products and increased sales to specialty retail customers. Management noted that wholesale growth was broad-based, extending across both specialty and department store accounts, underscoring the segment's growing contribution to URBN's revenue diversification strategy.
Meanwhile, Nuuly remained one of the company's fastest-growing businesses. Subscription revenues increased 34.5% to $167.3 million, fueled by a 33.3% increase in average active subscribers. Management highlighted that Nuuly added more than 110,000 average active subscribers compared with the prior-year quarter and is approaching the milestone of 500,000 active subscribers. The business generated an operating profit during the quarter, demonstrating that subscriber growth is being accompanied by improving profitability as the platform scales.
Management expects high-single-digit total sales growth in the second quarter. The outlook is supported by anticipated high-single-digit comparable sales growth at FP Group and Urban Outfitters, along with low- to mid-single-digit comparable sales growth at Anthropologie. With digital demand remaining strong, wholesale momentum continuing and Nuuly steadily expanding its subscriber base, URBN appears well-positioned to sustain growth across its Retail, Wholesale and Subscription segments.
URBN’s Price Performance, Valuation & Estimates
Shares of Urban Outfitters have gained 6.3% over the past three months compared with the industry’s 3.2% growth.
Image Source: Zacks Investment Research
From a valuation standpoint, URBN trades at a trailing price-to-sales ratio of 0.99X, down from the industry’s average of 1.45X. It has a Value Score of A.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for Urban Outfitters’ fiscal 2027 earnings implies year-over-year growth of 11.8%, whereas the same for fiscal 2028 indicates an uptick of 9.8%. Estimates for fiscal 2027 and 2028 have been revised upward by 11 cents and 13 cents, respectively, over the past 30 days.
Image Source: Zacks Investment Research
URBN currently carries a Zacks Rank #3 (Hold).
Key Picks
We have highlighted three better-ranked stocks in the retail space, namely Tapestry, Inc. (TPR - Free Report) , Genesco Inc. (GCO - Free Report) and Levi Strauss & Co. (LEVI - Free Report) .
Tapestry is the designer and marketer of fine accessories and gifts for women and men in the United States and internationally. The company sports a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Tapestry’s current fiscal-year earnings and sales indicates growth of 36.3% and 13.8%, respectively, from the year-ago actuals. TPR delivered a trailing four-quarter average earnings surprise of 15.6%.
Genesco is a Nashville-based specialty retail and branded company, sells footwear and accessories in retail stores. The company flaunts a Zacks Rank #1 at present.
The Zacks Consensus Estimate for Genesco’s current fiscal-year earnings indicates growth of 55.2% from the year-ago actuals. GCO delivered a trailing four-quarter average earnings surprise of 3.8%.
Levi Strauss designs and markets jeans, casual wear and related accessories for men, women and children. It currently carries a Zacks Rank #2 (Buy).
The Zacks Consensus Estimate for Levi Strauss’ current fiscal-year earnings and sales suggests growth of 12.7% and 5.2%, respectively, from the year-ago actuals. LEVI delivered a trailing four-quarter average earnings surprise of 21.4%.
View the Zacks #1 Rank List
Image: Bigstock
How Retail, Wholesale & Nuuly Are Supporting URBN's Growth Momentum
Key Takeaways
Urban Outfitters Inc. (URBN - Free Report) continues to benefit from the strength of its diversified operating model, with its Retail, Wholesale and Subscription businesses each contributing meaningfully to growth. By generating revenues through stores, digital channels, wholesale partnerships and its rapidly expanding Nuuly rental platform, the company has built a balanced business that is helping drive consistent performance across varying consumer spending environments.
The strategy delivered another strong quarter. In the first quarter of fiscal 2027, URBN reported record revenues of $1.48 billion, an increase of 11.4% from the prior-year period, marking its seventh consecutive quarter of record sales and earnings. Retail remained the company's largest business, with segment sales rising 8% to $1.22 billion. Comparable retail sales increased 5.6%, supported by high-single-digit growth in digital sales and mid-single-digit growth in store sales, highlighting healthy customer engagement across channels.
Wholesale provided a significant boost to overall performance. Segment revenues climbed 24.8% to $93.2 million, driven primarily by strong demand for FP Group products and increased sales to specialty retail customers. Management noted that wholesale growth was broad-based, extending across both specialty and department store accounts, underscoring the segment's growing contribution to URBN's revenue diversification strategy.
Meanwhile, Nuuly remained one of the company's fastest-growing businesses. Subscription revenues increased 34.5% to $167.3 million, fueled by a 33.3% increase in average active subscribers. Management highlighted that Nuuly added more than 110,000 average active subscribers compared with the prior-year quarter and is approaching the milestone of 500,000 active subscribers. The business generated an operating profit during the quarter, demonstrating that subscriber growth is being accompanied by improving profitability as the platform scales.
Management expects high-single-digit total sales growth in the second quarter. The outlook is supported by anticipated high-single-digit comparable sales growth at FP Group and Urban Outfitters, along with low- to mid-single-digit comparable sales growth at Anthropologie. With digital demand remaining strong, wholesale momentum continuing and Nuuly steadily expanding its subscriber base, URBN appears well-positioned to sustain growth across its Retail, Wholesale and Subscription segments.
URBN’s Price Performance, Valuation & Estimates
Shares of Urban Outfitters have gained 6.3% over the past three months compared with the industry’s 3.2% growth.
Image Source: Zacks Investment Research
From a valuation standpoint, URBN trades at a trailing price-to-sales ratio of 0.99X, down from the industry’s average of 1.45X. It has a Value Score of A.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for Urban Outfitters’ fiscal 2027 earnings implies year-over-year growth of 11.8%, whereas the same for fiscal 2028 indicates an uptick of 9.8%. Estimates for fiscal 2027 and 2028 have been revised upward by 11 cents and 13 cents, respectively, over the past 30 days.
Image Source: Zacks Investment Research
URBN currently carries a Zacks Rank #3 (Hold).
Key Picks
We have highlighted three better-ranked stocks in the retail space, namely Tapestry, Inc. (TPR - Free Report) , Genesco Inc. (GCO - Free Report) and Levi Strauss & Co. (LEVI - Free Report) .
Tapestry is the designer and marketer of fine accessories and gifts for women and men in the United States and internationally. The company sports a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Tapestry’s current fiscal-year earnings and sales indicates growth of 36.3% and 13.8%, respectively, from the year-ago actuals. TPR delivered a trailing four-quarter average earnings surprise of 15.6%.
Genesco is a Nashville-based specialty retail and branded company, sells footwear and accessories in retail stores. The company flaunts a Zacks Rank #1 at present.
The Zacks Consensus Estimate for Genesco’s current fiscal-year earnings indicates growth of 55.2% from the year-ago actuals. GCO delivered a trailing four-quarter average earnings surprise of 3.8%.
Levi Strauss designs and markets jeans, casual wear and related accessories for men, women and children. It currently carries a Zacks Rank #2 (Buy).
The Zacks Consensus Estimate for Levi Strauss’ current fiscal-year earnings and sales suggests growth of 12.7% and 5.2%, respectively, from the year-ago actuals. LEVI delivered a trailing four-quarter average earnings surprise of 21.4%.