Shares of Guess Inc. shot up 18 percent in afterhours trading Wednesday after the downtown L.A. apparel maker announced better-than-expected earnings.
Guess reported second-quarter net income of $39.9 million (47 cents a share), a 7 percent decrease from the same period a year earlier. Revenue rose 0.6 percent to $639 million. The results far exceeded expectations as analysts believed earnings would be 35 cents on revenue of $623 million.
Guess also cut its earnings outlook for the fiscal year ending Feb. 1. It now expects to earn between $1.70 and $1.84 per share on revenue between $2.56 billion and $2.59 billion. It had expected earnings between $1.70 and $1.90 per share on revenue between $2.57 billion and $2.61 billion.
The company said sales increased last quarter in North America and Europe, but fell in China.
Chief Executive Paul Marciano said there are ongoing concerns in Europe and China.
“We are very encouraged by the improvements in the trends of our North American retail business in the second quarter,” Marciano said in a statement. “However, the economic climate in Southern Europe continues to be challenging and we are beginning to see a slowdown in China.”
Before the announcement, shares were up 0.1 percent to $27.31 in Wednesday trading on the New York Stock Exchange. Shares shot to $32.15 in afterhours trading.