Operator: And our next question coming from the line of Alex Straton from Morgan Stanley.
Alex Straton: Great. So do you view this as a holster inflection? And what processes have you put in place or change to kind of keep the brand from devolving back to where it was before?
Fran Horowitz : Yes. I mean it’s exciting to see 2 consecutive quarters of growth. We’re seeing lots of opportunity within the brand. As you know, we’ve repositioned it, and we have certainly come out with a nice new marketing that the consumer is really responding to. We have a playbook that is working where we focus on our assortment architecture, our product, our voice, our experience. And our expectation is to stay close to that customer and continue to see growth.
Scott Lipesky: Yes. And also for Hollister, just like Abercrombie, we’ve been talking, the inventory is in a great place down like take last year that brand is chasing. So as we’re trying new things and have been broadening that assortment globally, we’re able to chase into those winners and that’s been part of the driver of Hollister, having that plus 8, and then having that plus 11. And so we’re excited about going forward with clean inventory.
Operator: And our next question coming from the line of Mauricio Serna with UBS.
Mauricio Serna: Great I guess just on the 4Q guidance. Should we assume kind of like the similar growth trend in terms of Abercrombie outperforming Hollister? And then maybe could you elaborate on the inventory decline by brand? Like I just want to understand like which brand has like a higher decline or where we see like a more moderate inventory levels on a brand perspective? And then when thinking about fiscal year ’24, I know you’re not giving guidance yet, but just thinking about our raw material cost recapture tailwind that you expect or that you have for 2024, maybe you could quantify that. And then just very lastly, could you talk about maybe about growth opportunities across each brand? I mean, I’m particularly interested in Hollister list because I remember you had talked about the international business still being well below prepandemic levels. I just want to understand where we stand on that front.
Scott Lipesky: All right, Reis, good to hear from you. All right. Let’s start with the Q4 guidance. So yes, similar trends is what the expectation would be as we’ve seen throughout the year. A&F outperforming Hollister. We do expect growth across regions. Good to see a nice acceleration in the Europe and APAC regions in Q3 and optimistic we can see continued trends there in Q4. Inventory by brand is where we want it to be. Hollister is down much more than Abercrombie is down, obviously, with the Abercrombie growth trend where it is. We’ve been adding inventory to that brand chasing throughout the year, and Hollister is down. We were stuck last year with some of that carryforward inventory and really through year-end last year on the Hollister side, but very clean now and excited about moving forward.
On the ’24 raw materials, you noted it, we’re not going to talk in detail about ’24. What we’ve said throughout the year is holding. We’ll see a little bit of freight benefit there in Q1 rolling into next year and then raw materials become a tailwind as we get into ’24. So we’ll talk a lot more about that on the Q4 call. And then the last piece was growth opportunity by brand. Hollister international, yes, we feel like we have an opportunity. COVID was tough for us. We’ve talked a lot about having a slow recovery coming out of COVID and more recently, it’s nice to see that business pick up. It started in Q2. Q3, we’re seeing nice traffic back to our stores. We’ve done a lot of localization efforts this year, pricing, marketing, inventory, and we’re seeing that play out.
One example is we’ve been focusing on U.K. and Germany, 2 of our biggest countries in the region, localizing our content, putting more marketing dollars there and we’ve seen a really nice response on an omnichannel basis. So we have some optimism there outside of the U.S. for the Hollister business going forward.
Operator: And our next question coming from the line of Paul from Citi.
Kelly Crago: This is Kelly on for Paul. Just curious, your 4Q guidance assumes a pretty meaningful deceleration in sales relative to the strengthen in 3Q. So just curious what’s driving that. And if you could provide any more color on the 4Q quarter comp trends? And any color by brand would be helpful. And then I have a follow-up.
Scott Lipesky: Sure. Kelly, it’s Scott. I’ll take this one. Yes. So Q4 guidance, we’re sitting here. We talked about an encouraging start to the quarter. I wouldn’t say these 3 weeks don’t matter, but they’re very small in the grand scheme. The game really starts today and the tomorrow into the next days through Christmas. So that’s how we’re sitting here today. We think this is a reasonable outlook. Happy to be putting up another low double-digit outlook coming into the quarter. Inventory is in a great place, excited about pressing our bets and marketing as we go through the fourth quarter. Our profitability has afforded us the opportunity to do so. So really excited about the opportunity ahead of us. When we think about brands, we’re not going to talk about brands for the last few weeks. But just on the last question, expect Hollister or Abercrombie to outperform Hollister in the quarter and growth across brands and regions.
