Urban Outfitters, Inc. Earnings Cheat Sheet: Double-Digit Revenue Growth

Rising costs hurt S&P 500 (NYSE:SPY) component Urban Outfitters, Inc. (NASDAQ:URBN) in the second quarter as profit dropped from a year earlier. Urban Outfitters Inc. is engaged in the general consumer product retail and wholesale business, selling to customers through various channels including retail stores, catalogs and web sites.

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Urban Outfitters Earnings Cheat Sheet for the Second Quarter

Results: Net income for Urban Outfitters, Inc. fell to $56.7 million (35 cents per share) vs. $71.7 million (42 cents per share) a year earlier. This is a decline of 20.9% from the year earlier quarter.

Revenue: Rose 10.3% to $609.2 million from the year earlier quarter.

Actual vs. Wall St. Expectations: URBN beat the mean analyst estimate of 32 cents per share. Analysts were expecting revenue of $604.3 million.

Quoting Management: “We remain confident in our strategies and believe we made great executional progress during the quarter,” said Chief Executive Officer, Glen T. Senk. “We anticipate gradual improvements in our comparable sales over the balance of the fiscal year and into Spring 2012,” Mr. Senk finished.

Key Stats:

Gross margin shrank 4.6 percentage points to 37.9%. The contraction appeared to be driven by increased costs, which rose 19.1% from the year earlier quarter while revenue rose 10.3%.

Revenue has risen the past four quarters. Revenue increased 9.2% to $524 million in the first quarter. The figure rose 13.6% in the fourth quarter of the last fiscal year from the year earlier and climbed 13.4% in the third quarter of the last fiscal year from the year-ago quarter.

The company has now seen net income fall in each of the last three quarters. In the first quarter, net income fell 27.1% from the year earlier, while the figure fell 3.1% in the fourth quarter of the last fiscal year.

The company beat estimates last quarter after falling short in the previous two quarters. In the first quarter, it missed the mark by 2 cents, and in the fourth quarter of the last fiscal year, it fell short by 7 cents.

Competitors to Watch: Abercrombie & Fitch Co. (NYSE:ANF), The Gap Inc. (NYSE:GPS), American Eagle Outfitters (NYSE:AEO), The Buckle, Inc. (NYSE:BKE), Pacific Sunwear of California, Inc. (NASDAQ:PSUN), Zumiez Inc. (NASDAQ:ZUMZ), Aeropostale, Inc. (NYSE:ARO), The Wet Seal, Inc. (NASDAQ:WTSLA), Stein Mart, Inc. (NASDAQ:SMRT).

Investing Insights: Steve Jobs Prepares to Deliver a New Catalyst for Apple’s Stock.

(Source: Xignite Financials)