Abercrombie Shares Are Tanking After Ugly Earnings Report

Abercrombie & Fitch's shares are tanking after the company reported a 7% decline in quarterly same-store sales.

Shares were down 10% in premarket trading Thursday.

The company said revenue declined 5.8% to $890.6 million and same-store sales dropped by 5% in the U.S. and declined 9% internationally.

Net income rose to $12.9 million, or 17 cents per share, in the second quarter, from $11.4 million a year earlier.

Hollister performed the worst of the company's three brands. It suffered a 10% decline in comparable store sales, compared to a 6% decline for Abercrombie Kids and a 1% decline for Abercrombie & Fitch.

Abercrombie has been criticized for failing to update its fashions for the fickle teen market.

"In the past quarter, we believe we have made great progress in evolving the fashion component of our assortment, and this progress is clearly evident in our Back-to-School presentation," CEO Mike Jeffries said in a statement. "In a continued challenging environment, our sales for the second quarter were somewhat below plan, but we have seen modest improvement since the Back-to-School floorset. We are confident that the evolution of our assortment will drive further improvements going forward."