After the chaos of the last few months, some companies are managing to find a way forward. Abercrombie & Fitch Co. recently reported record net sales of $1.2 billion for its second fiscal quarter. Urban Outfitters, Inc. reported a record $252.2 million in net income for its first half of the year. Gap Inc., too, is continuing to reap the rewards of its larger turnaround, reporting positive comparable sales for the sixth straight quarter.

Still, the fashion industry — like much of retail — remains on somewhat shaky ground when it comes to predicting demand and sales. Many apparel and footwear brands manufacture abroad, where new, higher tariffs threaten to throw a wrench in their growth plans. Global supply chain costs are on track to rise up to 7% above inflation by the fourth quarter, per Kearney. And apparel and footwear are considered discretionary categories — meaning that, for many shoppers, clothes or shoes may take a backseat to essentials like food and gasoline.

Timing is another hurdle. Brands are fending off macroeconomic headwinds as they prepare for the ultra-important holiday period. PwC’s 2025 Holiday Outlook survey, which was conducted in June, found that 84% of consumers said they expected to cut back spending by the end of December, especially on clothing (36%) and big-ticket items (32%). More than half (53%) said price increases would affect their spending decisions during the holidays.

As Andrew Rees, the CEO of Crocs, said last month, “The current environment in the second half is concerning, and we see that clearly reflected in retail order books.”

Here are three main trends that fashion brands and retailers highlighted in earnings reports and earnings calls over the last few weeks.

Continued uncertainty from tariffs

Brands are continuing to feel the fallout from tariffs, especially with rates recently having gone up for multiple countries, including India and Brazil. Now, some companies say the hit to their businesses could be worse than anticipated.

For instance, Urban Outfitters, Inc. — which owns Urban Outfitters, Anthropologie and Nuuly — acknowledged that “the landscape continues to change” when it comes to duties. The company, which largely manufactures in Asia, now expects a hit of 75 basis points to its gross margin for the second half of the year. Back in May, COO Frank Conforti had predicted “potentially a negative 20-basis-point impact in the back half of the year.”

Speaking on the company’s second-quarter earnings call last week, Conforti said Urban Outfitters, Inc. is trying to mitigate damage from tariffs by negotiating better terms with vendors, diversifying suppliers, shifting transportation from the air to the ocean and “strategically adjusting pricing.” Still, he also warned against any knee-jerk reactions, saying, “We want to protect our customer experience, and that means protecting our product.” He added, “We’re going to try and do the best that we can, waiting for the dust to settle before we start to make extensive changes.”

Gap Inc., which reported its second-quarter earnings last week, estimated that tariffs could cause a net impact of as much as $175 million in its 2025 fiscal year — up from last quarter’s estimate of $150 million. Gap Inc. says it’s taking steps to mitigate the effects of tariffs, including reducing its reliance on certain regions for manufacturing and making changes around “targeted pricing.”

Speaking on an earnings call, Gap Inc. EVP and COO Katrina O’Connell said, “We remain focused on sustaining the momentum and market share gains that our reinvigoration playbook is driving as we pursue these plans.” The company does not expect “the annualization of tariffs in 2026 to cause further operating income declines next year,” O’Connell noted.

Under Armour, which reported earnings in early August, expects to incur $100 million in additional costs in fiscal 2026, due to tariffs. Although based in the U.S., Under Armour manufactures across the world, in countries including China, Vietnam and Indonesia. Speaking on the company’s first-quarter earnings call, CFO David Bergman said Under Armour is implementing countermeasures to deal with the tariffs, including sharing costs with partners and suppliers and revisiting prices.

The end of de minimis

Another tariff-related topic — the end of the de minimis loophole — also popped up in earnings calls. The longtime policy had allowed many U.S. brands to avoid paying import tariffs on packages valued at less than $800. The de minimis exemption ended for imports from China and Hong Kong in May, but ended for all countries on August 29, under an executive order from U.S. President Donald Trump.

Several small apparel and footwear brands voiced concerns about the change to Modern Retail, saying the end of de minimis meant they needed to abandon suppliers or push off orders. But, publicly, larger fashion companies have been quick to shrug off the end of de minimis, saying it could give them a leg up on their competition.

In its earnings call last month, ThredUp said the policy switch could actually benefit the company, which makes revenue from selling secondhand products. “Though the full impact is still uncertain, we believe the closure of the de minimis exemption is likely to cost higher prices for ultra-fast fashion goods and to reduce production volumes, both of which could continue to be positives for ThredUp,” CEO James Reinhart said.

Urban Outfitters, Inc. also reiterated that its business will be fine. On the company’s earnings call, Conforti, the COO, said the end of de minimis had an “immaterial impact” on the company. “We have just a very small amount of sales that … we receive that benefit on,” he noted.

The company’s chairman and co-founder Dick Hayne chimed in, “As far as the URBN brand is concerned, [the end of de minimis] can only help.” He continued, “Some of the folks who were big into this — Shein and some others — are obviously having a little bit [of a] harder time coping with some of the new regulations. So, to the degree that they’re shipping less, it should help us.”

Abercrombie & Fitch Co., for its part, had already been reducing its reliance on China and made light of the change to de minimis, too. Speaking on an earnings call last week, SVP and CFO Robert Ball said the company had “minimal exposure” to the de minimis exemption. He added, “Globally, we remain nicely diversified across 16 countries, and the team is continuing to evaluate supply chain footprint changes, vendor negotiations and operating expense efficiencies that will largely take shape in fiscal 2026.”

Holiday hopes

With Black Friday less than three months away, fashion brands are also starting to lay out their plans for getting ahead of the holidays.

For many, these efforts involve splashy campaigns, like Gap’s recent work with global pop group Katseye. Urban Outfitters, Inc.’s CFO Melanie Marein-Efron spoke of “outsized marketing investments” and a “pre-holiday push” to increase customer acquisition going into the ultra-important fourth quarter. On Tuesday, Anthropologie, one of URBN’s biggest brands, announced it was teaming up with actress Camila Mendes, its first big campaign under a new chief marketing officer.

Abercrombie & Fitch Co.’s Ball also mentioned that, during the third quarter, the company would increase marketing investments year over year by more than 100 basis points to support key partnerships. This month, it announced that Abercrombie & Fitch would be the NFL’s official fashion partner.

Other companies are focusing on product development to propel shoppers through their doors this winter. Allbirds mentioned it will debut a new Kiwi collection in November, consisting of a slipper, a clog and a low boot. The styles are “made for how people really live during the holidays: not dressed up, but warm, easy and inviting,” said CEO Joe Vernachio.

Vernachio also said that, this autumn, Allbirds will introduce “a broader range of new styles and materials than ever before.”

“In total, we expect to launch 19 new styles this season, a major step forward from a year ago,” he said. “We’ve often said that, to win in this market, you need a relentless flow of compelling product, and we’re delivering on that.”

While there are still unknowns around the holidays, some CEOs are moving forward with rosy outlooks. Richard Dickson, the CEO of Gap Inc., said, “What gives me confidence going into the holiday, for Gap, is … we are delivering consistently.” He added, “We continue to do what we say we’re going to do.”