#1AEO INC SECOND QUARTER 2022 Investor Presentation#2Safe Harbor Statement Under The Private Securities Litigation Reform Act of 1995 This release and related statements by management contain forward-looking statements (as such term is defined in the Private Securities Litigation Reform Act of 1995), which represent our expectations or beliefs concerning future events, including third quarter and fiscal year 2022 results. All forward-looking statements made by the company involve material risks and uncertainties and are subject to change based on many important factors, some of which may be beyond the company's control. Words such as "estimate," "project," "plan," "believe," "expect," "anticipate," "intend," "potential," and similar expressions may identify forward-looking statements. Except as may be required by applicable law, we undertake no obligation to publicly update or revise any forward-looking statements whether as a result of new information, future events or otherwise and even if experience or future changes make it clear that any projected results expressed or implied therein will not be realized. The following factors, in addition to the risks disclosed in Item 1A., Risk Factors, of our Annual Report on Form 10-K for the fiscal year ended January 29, 2022 and in any other filings that we may make with the Securities and Exchange Commission in some cases have affected, and in the future could affect, the company's financial performance and could cause actual results for fiscal 2022 and beyond to differ materially from those expressed or implied in any of the forward-looking statements included in this release or otherwise made by management: the negative impacts of the COVID-19 pandemic and related operational disruptions; the risk that the company's operating, financial and capital plans may not be achieved; our inability to anticipate customer demand and changing fashion trends and to manage our inventory commensurately; seasonality of our business; our inability to achieve planned store financial performance; our inability to react to raw material cost, labor and energy cost increases; our inability to gain market share in the face of declining shopping center traffic; our inability to respond to changes in e-commerce and leverage omni-channel demands; our inability to expand internationally; difficulty with our international merchandise sourcing strategies; challenges with information technology systems, including safeguarding against security breaches; and global economic, public health, social, political and financial conditions, and the resulting impact on consumer confidence and consumer spending, as well as other changes in consumer discretionary spending habits, which could have a material adverse effect on our business, results of operations and liquidity. AEO INC#3Non-GAAP Measures This presentation includes information on non-GAAP financial measures ("non-GAAP" or "adjusted"), including consolidated adjusted earnings per share, excluding non-GAAP items. These financial measures are not based on any standardized methodology prescribed by U.S. generally accepted accounting principles ("GAAP") and are not necessarily comparable to similar measures presented by other companies. Non-GAAP information is provided as a supplement to, not as a substitute for, or as superior to, measures of financial performance prepared in accordance with GAAP. Management believes that this non-GAAP information is useful for an alternate presentation of the company's performance, when reviewed in conjunction with the company's GAAP consolidated financial statements, as it helps identify underlying trends in our business that could otherwise be masked by the effect of the items that we exclude in such non-GAAP measures. Accordingly, we believe that adjusted operating income provides useful information to investors and others in understanding and evaluating our operating results, enhancing the overall understanding of our past performance and future prospects, and allowing for greater transparency with respect to the key financial metrics used by our management in our financial and operational decision-making. 77 AEO INC.#4Second Quarter Fiscal 2022 Results Second quarter results impacted by challenging consumer backdrop and cycling record results from last year Expanding scope of expense and capital expenditure reductions Significant progress made on right-sizing inventory Total net revenue was flat, including 2 percentage points from our supply chain business AB 1977 AEO INC.#5"This is an unprecedented time in retail. As we cycle exceptional demand from last year, a tougher macro environment is impacting consumer spending behavior. Second quarter performance reflected these challenges, constraining revenue and amplifying margin pressure as we fully cleared through excess spring and summer goods," commented Jay Schottenstein, AEO's Executive Chairman of the Board and Chief Executive Officer. "In a shifting macro environment, we are focused on controlling the controllables. We entered the second half with inventory levels in a much better position and an assortment that is current for the Fall season. Given ongoing external uncertainties, we have taken additional actions to improve financial performance. We have made more expansive expense reductions and are pulling back further on capital expenditures. As an additional cautionary move, we have paused our quarterly cash dividend to strengthen our cash position. Our brands and products remain highly relevant and sought after by our customers. I am confident we will successfully navigate current challenges, and set AEO up for a stronger future." Jay Schottenstein AEO's Executive Chairman of the Board and Chief Executive Officer AEO INC.#6Key Highlights (unaudited) SECOND QUARTER TOTAL NET REVENUE CHANGE GROSS MARGIN SELLING, GENERAL & ADMINISTRATIVE EXPENSES OPERATING MARGIN EPS 2022 2021 0% 35% 30.9% 42.1% 25.7% 24.6% 1.2% 14.1% $0.04* $0.60* *Reflects adjusted earnings per share. GAAP EPS of ($0.24) includes $0.28 of debt related charges this year. GAAP EPS of $0.58 last year includes $0.02 of amortization of the non-cash discount on the Company's convertible notes. Inventory Data (unaudited) (in thousands) July 30, 2022 July 31, 2021 ENDING INVENTORY $687,046 ENDING INVENTORY % CHANGE TO PRIOR YEAR 36% ENDING INVENTORY UNIT % CHANGE TO PRIOR YEAR 22% QUARTERLY INVENTORY TURN(1) 1.21 $503,507 20% 9% 1.43 (1) Inventory turn is calculated as the total GAAP cost of goods sold for the quarterly periods divided by the straight average of the beginning and ending inventory balances from the consolidated balance sheets. AEO INC.#7Second Quarter Net Revenue Total Company Revenue Flat; Stores Revenue Down 2%; Digital Revenue Down 6% AMERICAN EAGLE $846M $778M 2Q21 2Q22 AERIE $372M $336M 2021 2Q22 Net Revenue Down 8% Net Revenue Up 11% TOTAL AEO $1,194M $1,198M 2Q21 2Q22 Net Revenue Flat* *Includes 2 percentage points from Quiet Platforms AEO INC.#8Second Quarter Operating Income Total Company Operating Income of $14M AMERICAN EAGLE AERIE Operating Margin 14.0% Operating Margin 3.2% $199M $109M $71M $12M CORPORATE AND OTHER1 -$107M* -$102M TOTAL AEO Operating Margin 1.2% $168M $14M* 2Q21 2Q22 2Q21 2Q22 2Q21 2022 2Q21 2Q22 (1) Corporate and Other includes revenue and operating results of the Todd Snyder and Unsubscribed brands and Quiet Platforms (net of intersegment eliminations), which have been identified as operating segments but are not material to disclose as separate reportable segments. Corporate operating costs represents certain costs that are not directly attributable to another reportable segment. *Includes $30M from higher end-of-season selloffs, $25M from higher freight and a $9M loss from Quiet Platforms AEO INC.#9Outlook Quarter-to-date, brand revenue down in the high-single digits following exceptional growth and a record Back-to-School season last year. Assuming current trends continue, the third quarter gross-margin rate would be in the mid-30s and fourth quarter in the low-30s. This reflects higher markdowns in anticipation of a more promotional retail environment and the company's seasonal clearance cadence which is more weighted to the fourth quarter. Expense cuts are now expected to drive $100 million in annualized expense reductions to plan, compared to our prior target of $60 million. This translates to SG&A dollars remaining relatively flat to last year in the second half, compared to prior guidance for low-to-mid-single digit growth. AEO INC.#10Results by Segment (Dollars in Thousands) (unaudited) 13 weeks ended July 30, 2022 Total net revenue Operating income (loss) % of revenue Capital expenditures 13 weeks ended July 31, 2021 Total net revenue Operating income (loss) % of revenue Capital expenditures 6969 EA 69 69 American Eagle 777,828 109,110 $ 14.0% 18,754 $ Corporate and Other (1) 48,613 $ (106,926) $ Total 1,198,124 14,014 1.2% 69,464 Aerie $ 371,683 $ 11,830 $ 3.2% 30,244 $ 20,466 $ Aerie Corporate and Other (1) Total 845,882 $ 335,795 $ 198,896 $ EA 23.5% 17,189 70,646 21.0% $ 12,479 $ (101,546) $ 1,194,156 167,996 14.1% $ 16,641 $ 15,569 $ 49,399 American Eagle (1) Corporate and Other includes revenue and operating results of the Todd Snyder and Unsubscribed brands, and Quiet Platforms (net of intersegment eliminations), which have been identified as operating segments but are not material to disclose as separate reportable segments. Corporate operating costs represents certain costs that are not directly attributable to another reportable segment. AEO INC.#11Statement of Operations Summary-GAAP Basis (unaudited) 13 Weeks Ended (In thousands) July 30, 2022 % of Revenue July 31, 2021 % of Revenue Total net revenue Cost of sales, including certain buying, occupancy and warehousing expenses Gross profit Selling, general and administrative expenses Depreciation and amortization expense Operating income Debt related charges Interest expense, net Other income, net (Loss) income before income taxes (Benefit) provision for income taxes Net (loss) income Net (loss) income per basic share Net (loss) income per diluted share Weighted average common shares outstanding - basic Weighted average common shares outstanding - diluted 1,198,124 100.0% 1,194,156 100.0% 828,107 69.1% 691,765 57.9% 370,017 30.9% 502,391 42.1% 307,832 25.7% 293,939 24.6% 48,171 4.0% 40,456 3.4% 14,014 1.2% 167,996 14.1% 60,066 5.1% 0.0% 3,421 0.3% 8,921 0.8% (1,839) -0.2% (1,363) -0.1% (47,634) -4.0% 160,438 13.4% (5,168) -0.5% 38,927 3.2% $ (42,466) -3.5% $ 121,511 10.2% 5959 (0.24) (0.24) 69 $ 0.73 0.58 180,189 180,189 167,491 208,933 AEO INC.#12GAAP to Non-GAAP Reconciliation 13 Weeks Ended July 30, 2022 Debt related charges Net (loss) income (In thousands, except per share amounts) Diluted earnings per common share Effective tax rate Weighted average common shares oustanding- diluted GAAP Basis 60,066 (42,466) $ (0.24) 10.9% 180,189 % of Revenue Non-GAAP Basis Less: Debt related charges Dilution (2) (1) % of Revenue 5.1% 60,066 -3.5% 49,126 0.28 26,512 0.0% 6,660 0.6% 0.04 46.4% 206,701 (1) (2) Pre-tax debt related charges of $60.1 million related primarily to the induced conversion expense on the exchange of our convertible notes, along with certain other costs related to actions we took to strengthen our capital structure. Dilution of 26.5 million shares consists of 25.3 million shares from the Company's 2025 notes and 1.2 million shares of equity awards. As GAAP results were a net (loss), these shares were not included in the diluted earnings per share denominator. AEO INC.#13Liquidity and Capital Allocation E AEO INC.#142Q22 LIQUIDITY $98M $453M* Cash & Cash Equivalents Total Available Liquidity *Includes $354 in net credit available Capital Allocation Priorities 1 Investments to Fuel Aerie's Growth & Build Capabilities 2 Preserving Balance Sheet Strength 3 Direct Shareholder Returns through a combination of dividends and share repurchases Cash Returned to Shareholders (unaudited) (In millions, except per share amounts) Cash used for share repurchases Number of shares repurchased Cash used for regular quarterly dividends Total dividends per share Total cash returned to shareholders E YTD SECOND QUARTER ENDED July 31, 2021 July 30, 2022 July 31, 2021 200.0 17.0 SECOND QUARTER ENDED July 30, 2022 200.0 17.0 34.4 30.3 0.180 $ 0.180 64.8 0.360 53.2 0.318 234.4 $ 30.3 $ 264.8 53.2 AEO INC.#15Balance Sheet Summary (unaudited) ASSETS (In thousands) Cash and cash equivalents Short-term investments Merchandise inventory Accounts receivable, net Prepaid expenses and other Total current assets Operating lease right-of-use assets Property and equipment, at cost, net of accumulated depreciation Goodwill, net Intangible assets, net Non-current deferred income taxes Other assets Total assets LIABILITIES & STOCKHOLDERS EQUITY (In thousands) Accounts payable Current portion of operating lease liabilities Unredeemed gift cards and gift certificates Accrued compensation and payroll taxes Accrued income taxes and other Other current liabilities and accrued expenses Total current liabilities Non-current operating lease liabilities Long-term debt, net Other non-current liabilities Total non-current liabilities Commitments and contingencies Preferred stock Common stock Contributed capital Accumulated other comprehensive loss Retained earnings Treasury stock July 30, 2022 January 29, 2022 July 31, 2021 $ 98,214 $ 434,770 $ 773,994 50,000 687,046 553,458 503,507 220,803 286,683 155,361 171,326 122,013 118,721 1,177,389 1,396,924 1,601,583 1,210,285 1,193,021 1,103,247 775,969 728,272 641,396 271,406 271,416 16,365 98,651 102,701 54,255 37,017 44,167 46,600 58,500 50,142 31,576 $ 3,629,217 $ 3,786,643 $ 3,495,022 July 30, 2022 January 29, 2022 July 31, 2021 198,645 $ 231,782 $ 221,471 328,348 311,005 288,534 51,111 71,365 44,095 50,788 141,817 133,185 16,708 16,274 25,365 72,461 70,628 56,568 718,061 842,871 769,218 1,137,656 376,522 24,055 1,538,233 1,154,481 1,094,386 341,002 24,617 331,680 24,207 1,520,100 1,450,273 2,496 2,496 380,959 636,355 2,496 630,506 (40,017) (40,845) 2,000,021 2,203,772 (36,894) 2,058,448 (970,536) (1,378,106) (1,379,025) Total stockholders' equity 1,372,923 Total Liabilities and Stockholders' Equity $ 3,629,217 $ 1,423,672 3,786,643 $ 1,275,531 3,495,022 Current ratio 1.64 1.66 2.08#16Real Estate Highlights AEQ INC.#172Q Real Estate Summary (unaudited) 23 1 1 (9) (1) (1) International license locations are not included in the consolidated store data or the total gross square footage calculation. Consolidated stores at beginning of period Consolidated stores opened during the period AE BRAND (2) Aerie (incl. OFFLINE)(3) Todd Snyder Unsubscribed Consolidated stores closed during the period AE BRAND (2) Aerie (inc. OFFLINE)(3) Consolidated stores at end of period AE BRAND (2) Aerie stand-alone (incl. OFFLINE)(3) Todd Snyder 1,141 4 1,160 873 276 65 Unsubscribed Total gross square footage at end of period [In Thousands] International licensed locations at end of period (1) 7,205 260 (2) AE Brand includes AE stand alone locations, AE/Aerie side-by side locations, AE/OFFLINE side-by-side locations, and AE/Aerie/Offline side-by-side locations. (3) Aerie (incl. OFFLINE) includes Aerie stand alone locations, OFFLINE stand alone locations, and Aerie/OFFLINE side-by-side locations AEO INC.#18Historical Quarterly Store Data by Brand (unaudited) AE SA Aerie SA End Store Count Weighted Gross Square Feet End Store Count Weighted Gross Square Feet Off/ine SA Weighted AE/ Aerie SBS Store Counts End Store Count Gross Square Feet End Store Count Weighted Gross Square Feet AE/Off/ine SBS Weighted AE / Aerie / Off/ine SBSBS End Store Count Gross Square Feet End Store Count Weighted Gross Square Feet End Store Count Aerie / Off/ine SBS Weighted Gross Square Feet FY2019 1Q19 785 4,875,024 119 446,170 151 1,172,404 2Q19 781 4,982,495 131 470,538 158 1,363,891 3Q19 775 4,914,297 142 510,574 170 1,479,306 4Q19 766 4,857,895 148 546,624 174 1,515,532 Total Stores (1) End Store Count Weighted Gross Square Feet Feet Feet 1,061 6,511,508 1,075 6,830,468 1,094 6,918,661 1,095 6,935,991 1Q19 6,047,428 446,170 2Q19 3Q19 6,346,385 6,393,603 470,538 4Q19 6,373,427 510,574 546,624 AE Sqft By Brand (2) Weighted Gross Square Aerie & Offline (3) Weighted Gross Square FY2020 1Q20 767 4,852,895 148 560,190 2Q20 760 4,800,204 160 576,479 3Q20 758 4,795,476 166 619,454 4Q20 722 4,571,986 171 651,258 1 4 275 9,051 175 1,539,215 175 1,545,014 177 1,554,830 178 1,566,771 1 7,423 1,093 6,958,479 1Q20 6,392,110 560,190 1,098 6,927,876 2Q20 6,345,218 576,479 1,105 6,978,215 3Q20 6,350,306 619,730 1,078 6,814,668 4Q20 6,146,180 660,308 FY2021 1Q21 713 4,524,654 174 667,658 5 10,898 177 1,595,290 1 7,423 2Q21 711 4,505,846 186 704,611 5 13,608 182 1,622,470 1 7,423 3Q21 4Q21 716 4,530,387 203 749,207 8 15,289 181 1,628,785 1 7,423 695 4,404,621 212 819,078 20 42,670 181 1,624,673 2 16,236 2 19,570 5 12 17,998 54,792 1,074 6,814,239 1,090 6,865,434 1,121 6,961,748 1,133 7,001,905 1Q21 2Q21 3Q21 4Q21 6,127,367 6,135,739 6,166,596 6,065,100 678,556 718,219 782,494 916,540 FY2022 1Q22 2Q22 689 4,376,087 686 4,360,553 217 224 851,913 878,365 19 31 56,185 74,868 185 183 1,639,209 1,629,930 2 2 16,236 16,236 2 2 20,118 20,118 18 21 124,486 138,152 1,141 7,105,875 1,160 7,144,146 1Q22 2Q22 6,051,650 6,026,837 1,032,584 1,091,385 (1) Total Stores includes Todd Snyder and Unsubscribed (2) AE Brand square footage includes AE stand alone locations, AE/Aerie side-by side locations, AE/OFFLINE side-by-side locations, and AE/Aerie/Offline side-by-side locations. (3) Aerie (incl. OFFLINE) square footage includes Aerie stand alone locations, OFFLINE stand alone locations, and Aerie/OFFLINE side-by-side locations AEO INC.#19Historical Financials AEO INC.#20Historical Financial Information - GAAP Basis (unaudited) (In thousands, except per share amounts and store counts) 2018 2019 2020 Q1 Fiscal 2021 Q2 Q3 Q4 2021 Q1 Fiscal 2022 Q2 YTD 2022 Total net revenue $ 4,035,720 $ 4,308,212 $ 3,759,113 $ 1,034,614 $ 1,194,156 $ 1,274,078 $ 1,507,937 $ 5,010,785 $ 1,055,037 $ 1,198,124 $ 2,253,161 Cost of sales, including certain buying, occupancy and warehousing expenses 2,548,082 2,785,911 2,610,966 598,424 691,765 Gross profit 1,487,638 1,522,301 1,148,147 436,190 502,391 709,554 564,524 Selling, general and administrative expenses 980,610 1,029,412 977,264 264,492 293,939 313,890 Impairment, restructuring and COVID-19 related charges 1,568 80,494 279,826 1,019,252 488,685 349,680 11,944 3,018,995 1,991,790 667,011 828,107 1,495,118 388,026 370,017 758,043 1,222,000 298,755 307,832 606,587 11,944 Depreciation and amortization expense 168,331 179,050 162,402 Operating income (loss) 337,129 233,345 (271,345) 38,271 133,427 40,456 167,996 40,947 209,687 47,107 166,781 47,369 48,171 95,540 79,954 591,065 41,902 14,014 55,916 Debt related charges 60,066 60,066 Interest expense (income), net (3,492) (6,202) 24,610 8,506 8,921 8,612 8,595 34,632 4,588 3,421 8,009 Other (income) expense, net Income (loss) before income taxes Provision (benefit) for income taxes Net income (loss) (4,479) 345,100 (5,731) 245,278 (3,682) (1,860) (1,363) (3,130) 3,865 (2,489) (4,444) (1,839) (6,283) 83,198 $ 261,902 $ 54,021 191,257 $ (292,273) (82,999) (209,274) $ 126,781 31,318 95,463 $ 160,438 38,927 121,511 $ 204,205 67,494 558,922 41,758 (47,634) (5,876) 51,981 17,066 139,293 10,018 (5,168) 4,850 152,224 $ 50,428 $ 419,629 $ 31,740 $ (42,466) $ (10,726) Net income (loss) per basic share $ Net income (loss) per diluted share (1) 1.48 $ 1.47 $ 1.13 $ 1.12 $ (1.26) $ (1.26) $ 0.57 $ 0.46 $ 0.73 $ 0.58 $ 0.91 0.74 $ $ 0.30 $ 0.25 $ 2.50 $ 0.19 $ (0.24) $ (0.06) 2.03 $ 0.16 $ (0.24) $ (0.06) Weighted average common shares outstanding - basic Weighted average common shares outstanding - diluted 176,476 178,035 169,711 170,867 166,455 166,455 167,257 167,491 167,637 167,611 206,562 208,933 205,013 203,388 168,156 206,529 168,460 219,742 180,189 174,544 180,189 174,544 Comparable sales (2) (3) American Eagle brand comparable sales Aerie brand comparable sales 8% 3% Not provided Not provided 32% 20% 13% Not provided -5% -9% -7% 5% 0% Not provided Not provided 39% 21% 11% Not provided -7% -10% -8% 29% 20% Not provided Not provided 25% 18% 17% Not provided -2% -6% -4% Total revenue growth (2) 6% 7% -13% 88% 35% 24% 17% 33% 2% 0% 1% American Eagle brand revenue growth (4) Not provided 3% -21% 86% 35% 21% 11% 30% -6% -8% -7% Aerie brand revenue growth (4) Not provided 28% 24% 92% 34% 28% 27% 39% 8% 11% 9% Total store count - end of period 1,055 1,095 1,078 1,074 1,090 1,121 1,133 1,133 1,141 1,160 1,160 Weighted gross square feet - end of period 6,638 6,800 6,739 6,814 6,865 6,962 7,002 6,790 7,106 7,144 7,083 (1) In Q1 2022, the Company adopted ASU 2020-06 under the modified retrospective method, which requires the Company to utilize the "if-converted" method of calculated diluted EPS. (2) Comparable sales includes results from Todd Snyder and Unsubscribed brands. Total revenue growth includes results from Todd Snyder and Unsubscribed brands and the Supply Chain Platform. (3) Comparable sales are calculated for stores and channels open at least one year over the comparable prior year period. In fiscal years following those with 53 weeks, the prior year period is shifted by one week to compare similar calendar weeks. A store is included in comparable sales in the thirteenth month of operation. However, stores that have a gross square footage change of 25% or greater due to a remodel are removed from the comparable sales base, but are included in total sales. These stores are returned to the comparable sales base in the thirteenth month following the remodel. Sales from American Eagle, Aerie, Todd Snyder, and Unsubscribed stores, as well as sales from AEO Direct and other digital channels, are included in total comparable sales. The Company did not provide comparable sales results for fiscal 2020, fiscal 2021, or fiscal 2022 due to temporary store closures as a result of COVID-19. (4) Prior to fiscal 2018, the Company did not disclose segment information; therefore, growth compared to the prior year is unavailable for fiscal 2018.#21Historical Adjusted Operating Income Reconciliation (unaudited) Fiscal 2021 (In thousands) Operating income (loss) - As reported % of Revenue 2018 2019 2020 Q1 Q2 Q3 Q4 2021 Q1 Fiscal 2022 (4) Q2 2022 (4) $ 337,129 8.4% $ 233,345 $ (271,345) 5.4% -7.2% 133,427 12.9% $ 167,996 14.1% $ 209,687 16.5% 79,954 $ 591,065 $ 5.3% 11.8% 41,902 4.0% 14,014 1.2% $ 55,916 2.5% Incremental COVID-19 related expenses Severance and related employee costs Joint business venture exit charges Japan market transition costs China restructuring (3) Long-lived asset impairment charges (1) (2) 66,252 249,163 11,944 11,944 26,930 1,568 6,691 3,733 4,194 1,814 1,543 Operating income (loss) - Adjusted % of Revenue $ 338,698 8.4% $ 313,839 7.3% $ 8,481 0.2% $ 133,427 $ 12.9% 167,996 14.1% $ 209,687 16.5% $ 91,898 6.1% $ 603,009 12.0% $ 41,902 4.0% $ 14,014 1.2% $ 55,916 2.5% (1) In fiscal 2021, the Company recorded impairment charges of $11.9 million primarily related to store property and equipment and operating lease ROU assets. In fiscal 2020, the Company recorded impairment charges of $249.2 million. Included in this amount are retail store impairment charges of $203.2 million, of which $154.8 million relates to operating lease ROU assets and $48.4 million relates to store property and equipment (fixtures and equipment and leasehold improvements). We also recorded $28.0 million related to the impairment of certain corporate property and equipment, as well as $18.0 million of certain cost and equity method investments. In fiscal 2019, the Company recorded asset impairment charges of $64.5 million on the assets of 20 retail stores. Of the total, $39.5 million related to the impairment of leasehold improvements and store fixtures, and $25.0 million related to the impairment of operating lease ROU assets. The Company also concluded that certain goodwill was impaired resulting in a $1.7 million charge in fiscal 2019. (2) Incremental COVID-19 related expenses consisted of personal protective equipment and supplies for our associates and customers. (3) Pre-tax corporate restructuring charges of $1.5 million, primarily consisted of severance and closure costs for our company-owned and operated stores in China recorded in the first quarter of fiscal 2019. (4) GAAP results for Q2 2022 and YTD 2022 included $60.1 million of pre-tax debt related charges related primarily to the induced conversion expense relating to the Note Exchange, along with certain other costs related to actions taken to strengthen our capital structure, which was recorded below Operating income (loss).#22REAL Power. REAL Growth. Value Creation Plan MERICAN 1977 EAGLE AEONC#23Unique Brands With Real Customer Connections A Dominant American Brand #1 Jeans Brand - Ages 15-25 1 AMERICAN EAGLE We're an American jeans and apparel brand that's true in everything we do. Rooted in authenticity, powered by positivity, and inspired by our community we welcome all and believe that putting on a really great pair of #AEJEANS gives you the freedom to be true to you. ― #2 Women's Apparel Brand #3 Men's Apparel Brand 2 1 NPD 2 "Piper Sandler Spring 2022 "Taking Stock With Teens" Data Reflects % of Surveyed Teens Preferring the Brand 2 AEO INC.#24Unique Brands With Real Customer Connections The Most Exciting Concept In Retail aerie We make intimates, apparel, activewear and swim. Every single thing is designed to make every person feel good. #Aerie REAL is about power, positivity, and no retouching. We want everyone. to feel comfortable inside and out. Let the real you shine™M. 25% Compounded Annual Growth Rate * $65B Addressable Market Opportunity* *U.S. Market Only; Source: NPD; Category Data T12M Through Dec 2019 (Pre-COVID) AEO INC.#25Customer Centric Omni Channel Retailer With Growing Digital Presence Digital 20% 5-Year CAGR $4.3B $5.0B Same Day Delivery (Pilot) Buy Online, Ship From Store Buy Online, Pick-Up From Store $1.8B $4.0B $3.8B $1.3B $3.8B $3.6B $1.1B $1.0B COVID IMPACTED Alternative Payment Social Commerce $0.8B $1.7B Digital + Stores = Options Frictionless, Convenient $3.1B Shopping Customer Self-Checkout (Pilot) Popular Mobile App Curbside Pick-Up 2Q22 DIGITAL PENETRATION $2.9B $3.0B $2.8B $2.8B Store To Door $2.1B 2016 2017 2018 2019 2020 2021 DIRECT REVENUE STORES REVENUE AMERICAN EAGLE ~30% AERIE ~50%#26● Value Creation Plan Grow Aerie to $2 Billion+ in Revenue Drive Sustained Profitable Growth at American Eagle Leverage Customer-Focused Capabilities Strengthen ROI Discipline Power of People, Culture and Purpose ERICAN EAC 1977-USA AEO INC.#27Aerie's Roadmap to $2 Billion+ in Revenue 1 Winning in Intimates & Lounge 2 Activewear Product Extension 3 Market Expansion 4 New Customer Acquisition Drive Sustained Profitable Growth at American Eagle 1 Refresh Brand DNA 2 Complete The Outfit 3 Optimize Inventory 4 Right-Size Store Footprint AEO INC.#28的 AEONC