(Bloomberg) -- Abercrombie & Fitch Co. boosted its forecast on the back of stronger-than-expected third-quarter sales as the retro brand’s comeback continues to resonate with teens and young millennials celebrating the fashion of the early 2000s.

The company now sees 2024 net sales rising 12% to 14%, compared to about 10%. In the third quarter, it saw comparable sales rise 16%, ahead of an estimated 10.3%. Adjusted earnings per share of $1.83 beat estimates of $1.15 per share.

Still, shares of Abercrombie were down 6.8% as of 9:54 a.m. in New York, taking a pause from a remarkable run so far this year. Shares are up 216% year to date, compared with 2% for the S&P SmallCap 600 Index, marking a retail transformation of a company that lost favor with teens a decade ago but managed to reinvent itself and become cool again.

The bear argument to this “massive” beat is that with the stock up 216% so far this year, the bar was “very high” and these results won’t shock investors, Vital Knowledge’s Adam Crisafulli wrote. 

Rival apparel chain American Eagle Outfitters Inc. also slumped in premarket trading despite solid third-quarter results and increased guidance. The company expects full-year revenue to rise by a mid-single-digit percentage, up from its previous expectation of low single digits. Shares plunged 18% in New York trading at 9:54 a.m., the most since April 2020, having risen 41% so far this year through Monday.

For the Abercrombie brand, net sales are up 30% year-over year. Net sales have risen 11% at Hollister from a year ago. The company expects fourth-quarter net sales growth to be up by low double-digits compared to fiscal fourth quarter 2022 level of $1.2 billion.

“Entering the important holiday season, our fiscal 2023 year-to-date results give us the confidence that we can continue to deliver for our customers and drive profitable growth,” Abercrombie Chief Executive Officer Fran Horowitz said in a statement on Tuesday.

Earlier: Abercrombie, Cool Once Again, Hikes Full-Year Outlook

--With assistance from Janet Freund.

(Updates with Abercrombie shares in third paragraph, American Eagle shares in fifth paragraph.)

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