Urban Outfitters, Inc. (NASDAQ:URBN) Q1 2024 Earnings Conference Call May 23, 2023 5:15 PM ET

Company Participants

Oona McCullough - Investor Relations

Richard Hayne - Chief Executive Officer

Frank Conforti - Co-President and Chief Operating Officer

Melanie Marein-Efron - Chief Financial Officer

Sheila Harrington - Global Chief Executive Officer, Urban Outfitters & Free People Groups

Conference Call Participants

Adrienne Yih - Barclays

Lorraine Hutchinson - Bank of America

Paul Lejuez - Citi

Alex Straton - Morgan Stanley

Matthew Boss - JPMorgan

Dana Telsey - Telsey Advisory Group

Marni Shapiro - The Retail Tracker

Janet Kloppenburg - JJK Research Associates

Jay Sole - UBS

Operator

Good day, ladies and gentlemen and welcome to the Urban Outfitters First Quarter Fiscal ‘24 Earnings Call. [Operator Instructions] As a reminder, this conference call is being recorded. I would now like to introduce Oona McCullough, Executive Director of Investor Relations. Ms. McCullough, you may begin.

Oona McCullough

Good afternoon and welcome to the URBN first quarter fiscal 2024 conference call. Earlier this afternoon, the company issued a press release outlining the financial and operating results for the 3-month period ending April 30, 2023. The following discussions may include forward-looking statements. Please note that actual results may differ materially from those statements. Additional information concerning factors that could cause actual results to differ materially from projected results is contained in the company’s filings with the Securities and Exchange Commission.

On today’s call, you will hear Richard Hayne, Chief Executive Officer; Frank Conforti, Co-President and COO; and Melanie Marein-Efron, Chief Financial Officer.

Following that, we will be pleased to address your questions. For more detailed commentary on our quarterly performance and the text of today’s conference call, please refer to our Investor Relations website at www.urbn.com.

I will now turn the call over to Dick.

Richard Hayne

Thank you, Oona and good afternoon everyone. As usual, I’ll begin the call with some brief remarks regarding our first quarter results and then make a few observations concerning the consumer and the macro environment. After that, I’ll turn the call over to Frank and Melanie, who will provide more details about our Q1 results along with thoughts about the future. A quick note, starting this quarter, we are breaking on FP Movement Retail segment sales and comps to provide you with better insight into our rapidly growing athletic brand.

Now on to a review of Q1. We are delighted to report an excellent start to fiscal 2024. First quarter results topped our expectations discussed on the February call. Four of our five brands posted record first quarter revenues and total URBN delivered 6% revenue growth against a strong first quarter last year. Double-digit comp sales growth in both the store and digital channels at the Anthropologie, Free People and FP Movement brands, more than offset a negative comp at the Urban Outfitters brand and drove total Retail segment comp sales up by 5%. Nuuly, our apparel rental service, continued to enjoy strong positive response to its business concept and product offering. Nuuly’s year-over-year revenues grew by 125% driven by a triple-digit gain in active subscribers, which totaled 167,000 at quarter’s end. Nuuly contributed $29 million in additional revenue versus last year’s first quarter. Wholesale revenue in the quarter declined by 11% as some of our larger partners sought to operate with leaner inventory levels and wrote smaller orders.