Urban Outfitters's (NASDAQ:URBN) Q3 CY2025 Sales Top Estimates, Stock Jumps 14.8%

Clothing and accessories retailer Urban Outfitters (NASDAQ:URBN) reported Q3 CY2025 results beating Wall Street’s revenue expectations, with sales up 12.3% year on year to $1.53 billion. Its GAAP profit of $1.28 per share was 8.5% above analysts’ consensus estimates.

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“We are pleased to report record revenues, profits, and earnings per share for the quarter,” said Richard A. Hayne, Chief Executive Officer.

Company Overview

Founded as a purveyor of vintage items, Urban Outfitters (NASDAQ:URBN) now largely sells new apparel and accessories to teens and young adults seeking on-trend fashion.

Revenue Growth

A company’s long-term sales performance can indicate its overall quality. Any business can have short-term success, but a top-tier one grows for years.

With $6 billion in revenue over the past 12 months, Urban Outfitters is a mid-sized retailer, which sometimes brings disadvantages compared to larger competitors benefiting from better economies of scale.

As you can see below, Urban Outfitters’s sales grew at a mediocre 8.2% compounded annual growth rate over the last three years (we compare to 2019 to normalize for COVID-19 impacts), but to its credit, it opened new stores and increased sales at existing, established locations.

This quarter, Urban Outfitters reported year-on-year revenue growth of 12.3%, and its $1.53 billion of revenue exceeded Wall Street’s estimates by 2.6%.

Looking ahead, sell-side analysts expect revenue to grow 7% over the next 12 months, similar to its three-year rate. Despite the slowdown, this projection is admirable and indicates the market sees success for its products.

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Store Performance

Number of Stores

Urban Outfitters opened new stores quickly over the last two years, averaging 2.9% annual growth, faster than the broader consumer retail sector.

When a retailer opens new stores, it usually means it’s investing for growth because demand is greater than supply, especially in areas where consumers may not have a store within reasonable driving distance.

Note that Urban Outfitters reports its store count intermittently, so some data points are missing in the chart below.

Same-Store Sales

The change in a company's store base only tells one side of the story. The other is the performance of its existing locations and e-commerce sales, which informs management teams whether they should expand or downsize their physical footprints. Same-store sales provides a deeper understanding of this issue because it measures organic growth at brick-and-mortar shops for at least a year.

Urban Outfitters has been one of the most successful retailers over the last two years thanks to skyrocketing demand within its existing locations. On average, the company has posted exceptional year-on-year same-store sales growth of 4.6%. This performance suggests its rollout of new stores is beneficial for shareholders. We like this backdrop because it gives Urban Outfitters multiple ways to win: revenue growth can come from new stores, e-commerce, or increased foot traffic and higher sales per customer at existing locations.

In the latest quarter, Urban Outfitters’s same-store sales rose 8% year on year. This growth was an acceleration from its historical levels, which is always an encouraging sign.

Key Takeaways from Urban Outfitters’s Q3 Results

We were impressed by how significantly Urban Outfitters blew past analysts’ EBITDA expectations this quarter. We were also glad its revenue outperformed Wall Street’s estimates. Zooming out, we think this quarter featured some important positives. The stock traded up 14.8% to $78.43 immediately following the results.

Urban Outfitters may have had a good quarter, but does that mean you should invest right now? If you’re making that decision, you should consider the bigger picture of valuation, business qualities, as well as the latest earnings. We cover that in our actionable full research report which you can read here, it’s free for active Edge members.