Urban Outfitters (URBN) investor relations material

Financial performance and outlook

• Achieved over 11% top-line growth and set a Q2 record with $1.5 billion in sales; all brands and geographies were comp positive.

• Nuuly and wholesale segments delivered double-digit growth, with Nuuly exceeding 50% top-line growth.

• Gross profit margin expanded by over 100 basis points, driven by lower markdowns and occupancy leverage.

• EPS grew by more than 20%, also a Q2 record.

• Expect similar strong performance in the second half of 2025, with continued gross margin expansion despite tariff headwinds.

Brand strategies and growth drivers

• Anthropologie’s turnaround focused on acquiring younger customers, modernizing assortment, and enhancing customer experience.

• New sub-brands (Celandine, LyreBird, Daily Practice) are expanding product range and expected to grow at double the rate of core brands.

• Free People is expanding store size, product categories, and international presence, especially in Europe.

• FP Movement targets a broad demographic and continues to open new stores, with strong sales per square foot.

• Nuuly aims for $500M in sales, with potential to reach $1B, driven by low market awareness and high new customer acquisition.

Margin improvement and operational efficiency

• Margin gains are expected from markdown improvements, logistics efficiencies, and automation, especially for Nuuly.

• Urban Outfitters is recapturing margin by reducing promotions and focusing on regular price sales.

• Distribution center expansion and automation for Nuuly are expected to drive further margin improvement beyond 2026.

• Leverage opportunities exist in occupancy, store controllables, and corporate expenses as comps improve.