Urban Outfitters, Inc. (URBN), the parent of the Anthropologie, Free People, FP Movement, Urban Outfitters and Nuuly retail brands, reported total company net sales for the fiscal second quarter (Q2) ended July 31 increased 11.3 percent year-over-year (y/y) to a record $1.50 billion.

  • Total Retail segment net sales increased 7.8 percent year/y, with comparable Retail segment net sales increasing 5.6 percent year-over-year. The increase in Retail segment comparable net sales was reportedly driven by mid-single-digit positive growth in both retail store sales and digital channel sales.
    • Comparable Retail segment net sales increased 6.7 percent at Free People, 5.7 percent at Anthropologie and 4.2 percent at Urban Outfitters.
  • Subscription segment net sales increased by 53.2 percent primarily driven by a 48.1 percent y/y increase in average active subscribers in the quarter.
  • Wholesale segment net sales increased 18.1 percent driven by a 19.5 percent increase in Free People wholesale sales primarily due to an increase in sales to specialty customers.

“We are proud to announce record revenues, profits, and earnings per share for the quarter,” said Richard A. Hayne, CEO, Urban Outfitters, Inc. “Our success was broad-based, with all five brands achieving positive comparable sales across all geographies. We saw exceptional performance across all of our segments – Retail, Subscription, and Wholesale – and believe these results reflect the strength of our brands, the effectiveness of our strategy, and the talent of our teams. We are confident in our continued momentum.”

Net sales by brand and segment for the three and six-month periods were as follows:


Profitability and Expenses
Second gross profit rate increased 113 basis points y/y, and gross profit dollars increased 14.8 percent to $566.2 million from $493.3 million in Q2 last year. The increase in the gross profit rate was said to be primarily due to improved Retail segment markdowns primarily driven by lower markdowns at the Urban Outfitters brand and leverage in occupancy costs due to the increase in comparable Retail segment and Subscription segment net sales. The increase in gross profit dollars was reportedly due to higher net sales and the improved gross profit rate.

Second quarter selling, general and administrative (SG&A) expenses increased by $43.6 million, or 12.5 percent, year-over-year. SG&A expenses deleveraged 28 basis points y/y as a percentage of net sales compared to the three months ended July 31, 2024. The deleverage in SG&A expenses as a percentage of net sales was said to be primarily related to increased marketing expenses to support customer growth and increased sales in the Retail and Subscription segments. The dollar growth in SG&A expenses was primarily related to increased marketing expenses to support customer growth and increased sales in the Retail and Subscription segments, as well as increased store payroll expenses to support the Retail segment stores net sales growth.

URBN’s effective tax rate for the second quarter was 21.5 percent, compared to 23.0 percent in the year-ago Q2 period. The decrease in the effective tax rate for the three months ended July 31, 2025, was primarily attributable to the ratio of foreign taxable earnings to global taxable earnings and the release of certain state and local valuation allowances.

Net income for the second quarter was reported as “a record” $143.9 million, or $1.58 per diluted share.

Inventory Summary
Total inventory increased by $91.5 million, or 15.1 percent, at quarter-end, compared to total inventory as of July 31, 2024.

  • Total Retail segment inventory increased by 15.0 percent and comparable Retail segment inventory increased by 11.3 percent.
  • Wholesale segment inventory increased by 16.4 percent.

The increase in inventory for both segments was said to be due to increased sales and planned early receipts of merchandise.

Share Repurchase
On June 4, 2019, URBN’s Board of Directors authorized the repurchase of 20 million common shares under a share repurchase program. During the six months ended July 31, 2025, the company repurchased and subsequently retired 3.3 million shares for approximately $152 million. During the twelve months ended January 31, 2025, the company repurchased and subsequently retired 1.2 million shares for approximately $52 million. As of July 31, 2025, 14.7 million common shares were remaining under the program.

Stores
URBN opened a total of 27 new retail locations in the six-month year-to-date period ended July 31, including: 19 Free People stores (including 10 FP Movement stores), 4 Anthropologie stores and 4 Urban Outfitters stores. The company closed 4 retail locations, including 2 Free People stores and 2 Urban Outfitters stores.

Urban Outfitters, Inc. is comprised of:

  • 257 Urban Outfitters stores in the United States, Canada, Europe and websites
  • 247 Free People stores, including 73 FP Movement stores, in the United States, Canada, Europe, catalogs and websites
  • 243 Anthropologie stores in the United States, Canada, Europe, catalogs and websites;
  • 9 Menus & Venues restaurants
  • 7 Urban Outfitters franchisee-owned stores and 2 Anthropologie franchisee-owned stores as of July 31.

Additionally, Free People, FP Movement and Urban Outfitters wholesale sell their products through department and specialty stores worldwide, digital businesses and the company’s Retail segment.

Nuuly is primarily a women’s apparel subscription rental service which offers a wide selection of rental product from the company’s owned brands, third-party brands and one-of-a-kind vintage pieces.

Image courtesy Urban Outfitters