American Eagle Outfitters, Inc.

Greetings and welcome to the American Eagle Outfitters third quarter 2019 earnings conference call. At this time, all participants are in a listen-only mode. A question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. I would now like to turn the conference over to your host, Ms. Judy Meehan. Thank you. You may begin.

Good morning, everyone. Joining me today for our prepared remarks are Jay Schottenstein, Chief Executive Officer, Chad Kessler, AE Global Brand President, Jen Foyle, Aerie Global Brand President, and Bob Maydor, Chief Financial Officer. Before we begin today's call, I need to remind you that we will make certain forward-looking statements. These statements are based upon information that represents the company's current expectations or beliefs. The results, actually, realized, may differ materially based on risk factors included in our SEC filings. The company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of our new information, future events, or otherwise, except as required by law. And now I'd like to turn the call over to Jay.

Thanks, Judy, and good morning, everyone. In the third quarter, we delivered strong comparable sales growth and record revenue. In a challenging environment, promotional activity increased relative to our expectation. Yet we achieved EPS that was in line with our guidance. Importantly, we continued to deliver on our strategic pillars with our core AEG and Aerie businesses, demonstrating strong performance. On a consolidated basis, this was our 19th consecutive quarter of positive comps with growth in both brands. We also saw a comp increase in stores and continued double-digit increases online. Aerie demonstrated unmatched momentum with growth in the quarter, accelerating on both year-over-year and two-year stack basis. This marked the 20th consecutive quarter of double-digit sales growth. New customers are embracing the brand, and expanded apparel offerings have been very well received. Aerie remains one of the fastest-growing brands in retail today, with profitability that continues to improve. We're just getting started and are very excited about the significant opportunity ahead. For the American Eagle brand, the back-to-school season was successful with strong demand in seasonal apparel. Third quarter sales profits was led by our focus on jeans, which had delivered 25 consecutive quarters of record sales. We are pleased with our investments in new denim fits and styles. However, after back-to-school, we experienced softer demand in certain apparel categories, primarily in men's and women's tops, which led to higher markdowns. Some of these pressures have continued into the fourth quarter. The team is working harder to strengthen the areas of underperformance and I'm confident we will be back on track in short order. We have an incredibly strong organization, highly relevant brands, and a leading omnichannel platform. We remain laser focused on our long-term strategic pillars to profitability growth across brands and channels. Improve inventory efficiency and deliver returns to shareholders. And now I'll turn the call to Chad to get further color on AE results.