American Eagle Outfitters CEO Stands By Controversial Sydney Sweeney Ad Amid Intense Backlash: 'You Can't Run From Fear'

American Eagle Outfitters CEO Jay Schottenstein personally approved the Sydney Sweeney ad campaign and instructed staff to stay put as backlash grew online over alleged racial and sexist connotations in the July 23 commercial, he told the Wall Street Journal in an exclusive interview published on Monday.

"You can't run from fear," the 71-year-old executive said, adding that the company put a small team in charge of monitoring social-media posts and hired a firm to poll customers. The poll results later showed that many customers viewed the ads favorably.

American Eagle noted that the ads helped bring in nearly a million new customers between July and September, according to the WSJ report. The Sweeney Cinched Waist denim jacket sold out in a day, and the Sydney Jean sold out in a week.

The boost was evident in the company's second-quarter results and an upbeat forecast for the current quarter, the company's report earlier this month showed.

Even as the controversy was unfolding, American Eagle unveiled a collaboration with Kansas City Chiefs football player Travis Kelce and his Tru Kolors clothing brand, the day after Kelce and pop star Taylor Swift announced their engagement.

Notably, American Eagle stock is up 33.2% this month, heading for its best monthly gains since November 2022.

On Stocktwits, the retail sentiment for AEO has turned 'bearish,' from 'neutral' a month ago, with the stock dropping 4% in Monday's session. Users noted the weakness in shares in recent days, with comments divided between calls to sell and buy more.

“$AEO great location for a swing. Will give it one more day to see that the 17 level is intact,” said one user.

Year-to-date, the stock has increased by nearly 7%.

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