The company’s stock traded lower as anxiety over a potential recession, inflation, supply chain challenges, and soaring transportation costs have swept over the entire specialty retail sector. In Q1 2022, ANF managed to grow sales 4% year-over-year (y-o-y) to $813 million, despite difficult comps related to lapping government stimulus and China lockdowns. However, the retailer did see meaningful gross margin compression of more than 800 basis points to 55.3% in Q1, driven by higher freight costs and accelerated sell-through of holiday inventory.