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IMAGINE A beach where for decades people have enjoyed sunbathing in the buff. Suddenly one of the world’s biggest corporations takes it over and invites anyone in, declaring that thongs and mankinis are the new nudity. The naturists object, but sun-worshippers flock in anyway. That, by and large, is the situation in the world’s open-source community, where bare-it-all purists are confronting Meta, the social-media giant controlled by a mankini-clad Mark Zuckerberg. More

Abercrombie & Fitch handily beat Wall Street’s expectations as the apparel company posted another quarter of torrid growth.
Despite the strong results, CEO Fran Horowitz pointed to an “increasingly uncertain environment” as macro conditions worsen.
The longtime mall retailer is seeing gains in its Hollister brand and international markets.

An Abercrombie & Fitch store in New York, US, on Monday, Nov. 20, 2023. Abercrombie & Fitch Co. is scheduled to release earnings figures on November 21. 
Stephanie Keith | Bloomberg | Getty Images

Abercrombie & Fitch’s revenue grew 21% during its fiscal second quarter as the apparel company builds on its torrid growth. 
The sales gain, which follows 16% growth in the year-ago period, led the company to issue bullish guidance for the current quarter. Still, its full-year outlook was largely in line with estimates as it prepares for one fewer week this year than last. 

CEO Fran Horowitz – who often says good companies win in any economic environment – may be bracing for a turbulent second half of the year because for the first time in four quarters, she referenced the uncertain state of the economy in the company’s earnings release.
“We delivered a strong first half of the year, and we are increasing our full-year outlook. Although we continue to operate in an increasingly uncertain environment, we remain steadfast in executing our global playbook and maintaining discipline over inventory and expenses,” said Horowitz. “We are on track and confident in our goal to deliver sustainable, profitable growth this year, while making strategic long-term investments across marketing, digital and technology and stores to enable future growth.”
The company’s shares — which are up nearly 89% this year — dropped about 9% in premarket trading.
Here’s how Abercrombie did compared with what Wall Street was anticipating, based on a survey of analysts by LSEG, formerly known as Refinitiv:

Earnings per share: $2.50 vs. $2.22 expected
Revenue: $1.13 billion vs. $1.10 billion expected

The company’s reported net income for the three-month period that ended Aug. 3 was $133 million, or $2.50 per share, compared with $57 million, or $1.10 per share, a year earlier.  

Sales rose to $1.13 billion, up about 21% from $935 million a year earlier. 
During the quarter, same-store sales jumped 18%, driven by better-than-expected summer and back-to-school selling. 
For the current quarter, Abercrombie expects sales to rise by a low double-digit percentage, better than the 8.9% growth that LSEG analysts had expected. 
Abercrombie raised its full-year sales guidance from 10% growth to a 12% to 13% increase, which is roughly in line with the 12% rise that LSEG analysts had expected. 
The company’s fiscal 2024 will have one fewer week than fiscal 2023, which is likely weighing on its full-year guidance. Abercrombie expects the loss of one selling week will have an $80 million impact on its holiday quarter, or 5.5 percentage points. For the full year, the company expects it to hit sales by $50 million, or 1.2 percentage points. 
Over the last year, Abercrombie has become known as retail’s biggest comeback story, and investors have been watching to see if the company can keep up its growth. 

Abercrombie & Fitch advertisement.
Courtesy: Abercrombie & Fitch

Horowitz has looked to international markets and the company’s Hollister and Abercrombie Kids brands as growth vectors, which are already boosting sales. 
During the quarter, sales at Hollister jumped 17% while comparable sales rose 15%. In the company’s Europe, Middle East and Africa division, sales climbed 16%. 
Costly international expansion was one of the missteps that weighed on Abercrombie’s performance in the past, but the company is taking a different approach this time around.
Earlier this month, it announced a partnership with Haddad Brands – a licensor of children’s wear – to create new distribution channels for Abercrombie Kids and grow the product line to include infant and toddler categories. 
“As we work to diversify A&F Co.’s channel mix and drive sustainable, profitable growth, we are thrilled to partner with Haddad Brands to build on our success and create an opportunity to grow the brand in the years ahead by engaging with new customers globally,” Horowitz said in a statement at the time. 
Products from Abercrombie Kids are set to be available in Haddad Brands’ showrooms globally next month.

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Foot Locker beat Wall Street’s estimates on the top and bottom lines as it posted comparable sales growth for the first time in six quarters.
The sneaker company also saw its gross margin expand for the first time in more than two years.
CEO Mary Dillon told CNBC Foot Locker is exiting a number of international markets and moving its headquarters from New York City to Florida.

A Foot Locker store near the Times Square neighborhood of New York, US, on Monday, Nov. 13, 2023.
Bing Guan | Bloomberg | Getty Images

Foot Locker on Wednesday said comparable sales grew for the first time in six quarters as its efforts to refresh its stores and improve the customer experience continue to bear fruit. 
The beleaguered sneaker company’s same-store sales grew 2.6% during its fiscal second quarter, far better than the 0.7% uptick that analysts had expected, according to StreetAccount. Its gross margin also expanded for the first time in more than two years. 

Despite the positive trends, the company’s shares dropped about 8% in premarket trading.
“The Lace Up Plan is working,” CEO Mary Dillon said in a press release, referencing the company’s turnaround strategy. “Our top line trends strengthened as we moved through the quarter, including a solid start to Back-to-School. We were also particularly pleased to deliver stabilization in our Champs Sports banner.” 
Here’s how Foot Locker did compared with what Wall Street was anticipating, based on a survey of analysts by LSEG:

Loss per share: 5 cents adjusted vs. 7 cents expected 
Revenue: $1.90 billion vs. $1.89 billion expected

In the three-month period that ended Aug. 3, Foot Locker had a loss of $12 million, or 13 cents per share, compared with a loss of $5 million, or 5 cents per share, a year earlier. Excluding one-time items, Foot Locker posted a loss of 5 cents per share. 
Sales rose to $1.90 billion, up about 2% from $1.86 billion a year earlier. 

For the current fiscal year, Foot Locker largely maintained its guidance and continues to expect sales to be in a range of a 1% decline to 1% growth from the prior year – better than the 0.4% decline that analysts had expected, according to LSEG. 
Foot Locker also stood by its adjusted earnings per share guidance. It expects earnings to be between $1.50 and $1.70 – much of that range ahead of the $1.54 that analysts had expected, according to LSEG. 
Since former Ulta Beauty boss Mary Dillon took the helm of Foot Locker about two years ago, she has worked to transform the company and ensure that it stays relevant in a world where brands aren’t as reliant on multibrand retailers as they were in the past. 
Dillon has worked to repair the company’s relationship with its biggest brand partner, Nike, and has also taken a hard look at its sprawling, but aging, store fleet, where the company does about 80% of its sales. The company plans to spend $275 million upgrading its stores this year, and it expects to have two-thirds of its fleet remodeled by the end of fiscal 2025.
In an interview with CNBC, Dillon said the store investments are leading to increased conversion, basket size and profitability, and better performance for Foot Locker’s women’s business.
“The reason that we’re doing it is that it is working for us, both in terms of enhancing a customer experience and a striper [store employee] experience, but also the financial returns,” said Dillon. “The performance is ahead of what we thought.”
In a series of new megastores Foot Locker is building in hotspots like New York City and Paris, the retailer is working hand in hand with Nike to develop some portions of the shops.
“With Nike, this has been since Day One, a high priority for me, and really building a partnership that isn’t just about like, what number of shoes are we going to sell, but how do we think about using consumer insights to mutually grow our businesses together,” said Dillon. “For us and Nike, it’s about the places that we really connect.”
Dillon has also worked to streamline costs at Foot Locker. On Wednesday, the company said it was closing its stores and e-commerce operations in South Korea, Denmark, Norway and Sweden, and will rely on a third party for operations in Greece and Romania, where it plans to expand its reach, according to Dillon. In all, 30 of Foot Locker’s 140 stores in the Asia-Pacific region and 629 in Europe will be closed or go under a new operator as part of the changes. 
Foot Locker’s Champs banner, which has been dragging down the company’s overall performance, is also showing some signs of improvement. During the quarter, comparable sales were down 3.9%, which is an improvement from the 25.3% decline it saw in the year-ago period.
Foot Locker is also planning to move its global headquarters from New York City to St. Petersburg, Florida, in late 2025 and plans to maintain only a limited presence in the Big Apple moving forward. 
“The intent of the relocation is to further build on the Company’s meaningful presence in St. Petersburg and to enable increased collaboration among teams across banners and functions, while also reducing costs,” Foot Locker said in a news release. 
Dillon told CNBC the move will increase margins by 0.2 percentage point by 2027, but the decision wasn’t just based on saving money.
“We’ve got a big center of gravity already in St. Pete … many of our executives are there. A lot of our commercial teams,” said Dillon. “We think actually bringing more people together for collaboration is going to matter and that’s also part of this. It’s not just about saving money. It’s about, how do we really continue to build on this momentum?”
The company isn’t planning to make employees relocate and Dillon, who is based in Chicago, won’t be forced to become a super commuter, either.
“I am traveling, I would say, 90% of the time, to our teams around the world, and to our brand partners, and to investor meetings and to events,” said Dillon. “I spend a good chunk of time in New York, I spend a lot of time in St. Pete, I spend a lot of time in Amsterdam where we have our headquarters, and visiting our brand partners. So I’m planning to keep my primary residence in Chicago, but the way that this has been working is really, I think, working pretty well so we’re going to continue to do that.”
As it improves stores, products, and the customer experience online and in stores, Foot Locker is managing to drive sales even as its core consumer continues to feel the pressure of consistent inflation and high interest rates – indicating that Dillon’s efforts are working. 
“We’re not expecting our customer to get, like, less pressured or more pressured. We’re just trying to say this is a category they care about,” said Dillon. “How can Foot Locker be the best to serve their needs? And I think our results are showing that that’s working.”
As of Tuesday’s close, shares of the company are up more than 5% this year, compared with Nike’s stock, which has fallen more than 21% in the same time period.
Demand has undoubtedly slowed across the retail industry, but consumers are still spending. They’re just being far choosier on who they’re spending with — which has made execution that much more important. 
“Our strategies are building momentum as we look to the remainder of the year,” said Dillon in a statement. “I remain confident that we are taking the right actions to position the Company for its next 50 years of profitable growth and create long-term shareholder value.”

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Lego said revenue during the first six months of the year jumped 13%, reaching 31 billion Danish krone, or about $4.65 billion.
The company is seeing strength across its portfolio, especially with Lego Icons and Lego Creator, and through its partnership with Epic Games’ Fortnite.
While consumers in China are spending less frequently and less on big-ticket items, Lego still sees “long-term potential” in the area.

Customers at a Lego store in Shanghai, China, on Feb. 3, 2024.
Costfoto | Nurphoto | Getty Images

An inflation-fueled sales slump hit the toy industry in the first half of 2024, but one company is gaining market share brick by brick.
On Wednesday, Lego said revenue during the first six months of the year jumped 13%, reaching 31 billion Danish krone, or about $4.65 billion.

Niels Christiansen, CEO of the privately held Danish toymaker, told CNBC that the company is seeing strength across its portfolio, especially with Lego Icons and Lego Creator, and through its partnership with Epic Games’ Fortnite.
Last year, Lego saw a trend of consumers “trading down” or opting for lower-priced sets, while still buying the same volume as the year before. This year, volume is up, Christiansen said.
“To the extent they traded down last year, they’re not trading further down,” he said. “So that has stabilized. And we see almost all of the growth is actually growth in volume.”

Meanwhile, publicly traded rival Mattel saw net sales fall 1% in the first six months of 2024 and Hasbro reported that its net revenue fell 21% between January and the end of June. Mattel is facing tough comparisons from toy sales fueled by “Barbie” in 2023, and Hasbro is still reeling from its divestment of eOne.
Lego has continued to build on pandemic-era growth with a diverse slate of products that cater to kids and adults alike. In addition to sets tied to popular franchises such as Harry Potter and Star Wars, Lego also has innovative design options for consumers to build flowers and succulents, famous works of art and animals.

Sales in the U.S. and Europe remain strong, Christiansen noted, while China sales are flat. He said consumers in the region are spending less on bigger-ticket items, and their frequency of purchasing is down.
However, Lego is not giving up on expansion in China. Christiansen said there is still “long-term potential” in the area.
Of the 40 Lego stores that opened in the first quarter, 20 were in China. Similarly, of the 60 planned openings in the second half of the year, 20 are set for China.

Sustainability

Christiansen also touted Lego’s sustainability efforts. So far this year, the company has nearly doubled the amount of renewable and recyclable materials it uses in its bricks compared to full-year 2023.
“That’s a good milestone,” he said. “That’s a good step forward. [We are] spending quite significantly on that in a couple of ways, primarily in buying material that is more expensive, because mass balance material is more expensive than just standard.”
Christiansen noted that Lego is not passing that cost on to consumers.
“By actually being willing to pay a premium to get to this product, we also created an incentive for [suppliers] to actually develop the kind of products and to establish more production capacity for these type of products. We are working really as an industry need to try to put more speed on that entire process.”
Over the next few years, Lego hopes to source half its raw materials from sustainable sources.

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Nordstrom handily beat Wall Street’s earnings estimates as its efforts to cut costs and boost efficiencies begin to bear fruit.
Despite the strong earnings beat, the company issued tepid guidance for the full year as it contends with softening demand for luxury goods.
The department store operator has been leaning on its off-price banner Nordstrom Rack for growth.

Signage outside a Nordstrom Rack retail store in New York on Aug. 25, 2022.
Gabby Jones | Bloomberg | Getty Images

Nordstrom on Tuesday posted earnings that blew past Wall Street’s expectations, indicating the department store is making strides in its efforts to cut costs and boost efficiencies. 
Though the Seattle-based retailer posted earnings per share that were 25 cents higher than expected, it issued tepid guidance for the full year. 

Nordstrom now expects adjusted earnings per share to be between $1.75 and $2.05, compared to a previous range of $1.65 to $2.05. It anticipates sales will be in a range of a 1% decline to 1% growth from the prior year, compared to previous guidance of down 2% to up 1%. 
In a news release, Nordstrom CEO Erik Nordstrom said the company is optimistic about the second half of the year despite the cautious guidance.
“Our second quarter results were solid, and we’re encouraged by the continued topline strength in both banners and the progress we’re making to expand gross margin and increase profitability,” said Nordstrom. “We’re confident in our outlook for the remainder of the year and look forward to sustaining the momentum we’ve built.”
Shares rose about 5% in extended trading.
Here is how the department store did in its second fiscal quarter compared to what Wall Street was anticipating, based on a survey of analysts by LSEG:

Earnings per share: 96 cents adjusted vs. 71 cents expected
Revenue: $3.89 billion vs. $3.90 billion expected

The company’s reported net income for the three-month period that ended Aug. 3 was $122 million, or 72 cents per share, compared to $137 million, or 84 cents per share, a year earlier. Excluding one-time items related to supply chain impairments, the retailer posted adjusted earnings of 96 cents per share. 
Sales rose to $3.89 billion, up about 3.4% from $3.77 billion a year earlier. Revenue came in just shy of analysts’ expectations.  
Across the company, comparable sales increased 1.9%, while gross merchandise value jumped 3.5%. It is unclear how much of that GMV uptick was related to price increases versus volume.
As consumers continue to pull back on discretionary spending in the face of persistent inflation and high interest rates, retailers have been working to improve operations and cut costs to protect profits against softening demand. 
During the quarter, Nordstrom’s profits fell compared to the same period a year ago, but earnings grew over the past six months. Last year, Nordstrom reported a net loss of $67 million in the six months that ended July 29, 2023, but during the same period this year, it posted a profit of $83 million. 
Nordstrom has said it is working to improve its supply chain. Last quarter, it said the time it takes for online orders to arrive was more than 5% faster. It has also improved the way merchandise is making its way to customers and stores, which it said has helped drive higher conversion and lower return rates. 
Another key focus area for the company has been growing its off-price banner, Nordstrom Rack. Over the past couple of quarters, momentum has been growing at Nordstrom Rack and has helped prop up the company’s overall results. During the quarter, sales at Nordstrom Rack were up 8.8%, while comparable sales increased 4.1% compared to the same period a year ago.
That compares to Nordstrom’s mainline banner, which saw net sales and comparable sales each increase just 0.9%. 
Nordstrom has been working to build more Rack locations and has opened 11 new locations so far this fiscal year, with a goal of opening at least 22 by the end of the year. The focus on Rack has been critical for Nordstrom’s ability to compete with off-price giant TJX Cos., the owner of TJ Maxx and Marshall’s, and capture consumers who are still spending but eager for cheaper options and deals.
The off-price sector has seen explosive growth for more than a year, but Rack missed out on the beginning of that trend. To reverse the slump, the company has focused on opening more locations, hiring off-price veterans and sharpening its focus on well-known brands.

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The NFL informally told owners and private equity firms it wants to take a percentage of potential private equity profits on sales of ownership stakes if the league votes to allow the firms to own pieces of teams.
It is unclear if the NFL’s decision will deter future private equity investment.
The league voted Tuesday to allow private equity ownership of up to 10% of teams.

Brock Purdy, #13 of the San Francisco 49ers, prepares to take a snap in the first quarter against the Kansas City Chiefs during Super Bowl LVIII at Allegiant Stadium in Las Vegas on Feb. 11, 2024.
Michael Reaves | Getty Images

The National Football League has informed owners and investment firms that it intends to take a percentage of private equity profits on any future sales of ownership stakes, according to people familiar with the matter.
NFL owners voted Tuesday to allow private equity firms to take a maximum 10% stake in teams.

The league has never allowed private equity investment before. Major League Baseball, the National Basketball Association and the National Hockey League already allow up to 30% of teams to be owned by investment firms, though the cap for individual funds is between 15% and 20%.
No other league takes a percentage of the so-called carry — the percentage of a fund’s investment profits that managers typically receive as compensation — for all private equity firms. It was unclear heading into the owners’ meeting if the NFL plan would apply to all or only some firms, or what percentage of the profits the league wanted to take.
The NFL has informally told investment firms that if they make a return on an investment, it wants a portion of the profits to be returned to the league.
It was also unclear if the NFL’s plans to take a piece of profits would deter future investment from private equity. The initial approved firms include Ares Management, Sixth Street Partners and Arctos Partners, and a consortium of investors including Dynasty Equity, Blackstone, Carlyle Group, CVC Capital Partners and Ludis, a platform founded by investor and former NFL running back Curtis Martin.
The NFL declined to comment.
Over the past 20 years, the league’s total value has risen from $23.46 billion to $190 billion, a 710% gain, according to Sportico. The S&P 500 index has risen about 660% during the same time span.

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The Washington Commanders’ stadium will be named Northwest Stadium, per a new agreement with Northwest Federal Credit Union that runs through the 2030-31 season.
The home of the Washington, D.C., NFL team has been without a naming rights partner since FedEx ended its deal with the Commanders in February, two years early. 
The Commanders are looking to build a new stadium in either Washington, D.C., or Virginia.

Washington Commanders fans celebrate after NFL team owners unanimously approved Josh Harris’ purchase of the team from Daniel Snyder, at The Bullpen’s “Burgundy and Sold” party on July 20, 2023.
Julia Nikhinson | The Washington Post | Getty Images

The home of the Washington Commanders just got a new name.
The team’s stadium will be renamed Northwest Stadium, per a new agreement with Northwest Federal Credit Union that runs through the 2030-31 season, according to a person familiar with the matter. The deal is worth an average annual value in the low $8 million range, according to the person.

The home of the Washington, D.C., NFL team has been without a naming rights partner since FedEx ended its deal with the Commanders in February, two years early. The shipping giant had a deal with the football team that ran from 1999 through the 2025 season.
“As we continue to work toward our goal of building the Commanders into an elite franchise that consistently competes for championships, we are excited to welcome our team and fans to Northwest Stadium and look forward to creating incredible memories together on the field and in the communities we serve,” said Washington Commanders Managing Partner Josh Harris in a statement.
The new agreement with the Northwest Federal Credit Union adds to an existing stadium sponsorship deal that came in at around $2 million per year, according to the person familiar with the matter. That deal did not include naming rights.
The expanded partnership includes Northwest branding across the stadium, including a new stadium logo. Northwest will also serve as the team’s jersey patch partner for off-season and in-season practices. The partnership will also extend new benefits to Commanders fans who are members of Northwest Federal Credit Union, including discounts on tickets and merchandise.
Last year, Northwest Federal Credit Union became the Commanders’ official credit union partner.

The Commanders are looking to build a new stadium in either Washington, D.C., or Virginia. Should the team move into a new stadium before the 2030-31 season ends, the Commanders have the right under the new agreement to seek a new naming rights partner for the new stadium, the person familiar with the matter said. The credit union does not have the rights to the new stadium or right of first refusal for those rights, the person added.
The Los Angeles Rams currently have the most valuable stadium naming rights deal in the NFL. That deal, with SoFi, is for $625 million over 20 years, according to a person familiar with that agreement. SoFi Stadium is also home to the NFL’s Chargers, but Rams owner Stanley Kroenke owns the stadium, so the Rams collect 85% of stadium sponsorship revenue.

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Soon after his private jet touched down on August 24th at Le Bourget airport, on the outskirts of Paris, Pavel Durov was arrested by French police. A statement later released by prosecutors said that the 39-year-old billionaire had been detained as part of an investigation into Telegram, the social-media app of which he is the founder and chief executive. French judges have until August 28th to decide whether to pursue charges or release him. More