Teen retailer American Eagle Outfitters Inc., seeking to exit the children's apparel business, is looking for ways to unload its chain of 77kids stores despite a first-quarter profit that beat Wall Street expectations.
In the three months ended April 28, American Eagle reported a profit of $39.7 million, or 20 cents per share, up from $28.3 million, or 14 cents, a year earlier. Sales jumped 18% to $719 million.
77kids is American Eagle's foray into the under-15 set. Begun as an online-only business in 2008, the brand now has 22 stores nationwide.
But the brand never seems to have taken off. In American Eagle's last fiscal year, that division reported a $24-million loss on sales of $40 million.