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American Eagle stock surged 25% after its earnings report Wednesday, with its CEO thanking the controversial Sydney Sweeney “Good Jeans” ad campaign for boosting brand awareness and profit.
“The fall season is off to a positive start. Fueled by stronger product offerings and the success of recent marketing campaigns with Sydney Sweeney and Travis Kelce, we have seen an uptick in customer awareness, engagement and comparable sales,” American Eagle Outfitters CEO Jay Schottenstein said on Wednesday in an earnings release statement.
Sweeney’s ad campaign with American Eagle certainly did bring awareness to the brand last month. In the video, the blonde-haired, blue-eyed actress is posing in American Eagle jeans, saying: “Genes are passed down from parents to offspring… My body’s composition is determined by my genes.”
Seemingly everyone had an opinion on it, from some people claiming eugenics to President Donald Trump calling the ad “fantastic.”
The company said in its earnings call on Wednesday that Sweeney’s jean collaborations with the company “sold out within a week” and that some of those items had sold out within a day.
“(Sweeney) is a winner, and in just six weeks, the campaign has generated unprecedented new customer acquisition,” chief marketing officer Craig Brommers said during the earnings call.
But questions remain whether American Eagle can convert those billions of impressions into real business.
“The (Sweeney and Kelce) campaigns combined have generated a staggering 40 billion impressions as we look ahead, our plan to build on this momentum,” American Eagle’s executive creative director, Jennifer Foyle, said during the call.
American Eagle had a much more negative outlook in its previous earnings in May, when Schottenstein said it was “a challenging period for our business” and withdrew its full-year outlook (it re-issued that guidance this quarter). The company also announced a write-off of $75 million in its merchandise in the first quarter, meaning that merchandise lost too much of its value to include in its inventory.
Like other retailers, American Eagle is also grappling with tariffs. On Wednesday, it said it expects tariff impacts to be $20 million in the third quarter and $40 million to 50 million in the fourth. It said price increases will be “ongoing” as one of its tools to mitigate tariffs.
American Eagle’s total revenue fell 1% to $1.28 billion in the second quarter, according to a press release.
Though American Eagle celebrated Sweeney as a successful ad campaign, it had ignited a cultural firestorm much akin to the failed Cracker Barrel logo change.
“It seemed clear to me that they were aligning themselves with a white nationalist, MAGA-friendly identity,” said Shalini Shankar, an anthropology professor at Northwestern University who studies youth and advertising, previously told CNN. “I think that this is them trying to rebrand themselves for the present moment, and language is very deliberately used here.
The New York Times found that the controversial advertisement with Sweeney escalated online once influential right-leaning accounts began amplifying claims of progressive outrage.
But American Eagle has made it clear that it will build off that attention.
“’Sydney Sweeney has great jeans’ is not going anywhere,” Brommers said, adding that they’ll introduce new elements to the campaign later this year.
CNN’s Scottie Andrew, Leah Asmelash and Harmeet Kaur contributed to this report.