And the way I think about it is gross margin will still see some pressure there year-over-year. While we see freight being a nice tailwind in Q4, cotton will absorb most of that as that fully comes into the P&L and flows through. On the other costs, not much else happening in AUC. We talked about AUR. And then other operating costs, we want to keep them relatively flat to last year. So really for Q4, year-over-year, it’s going to be a margin story, and we’ll work through the promo environment. And as Fran said, we’re targeting that inventory to be flat at year-end to last year and move cleanly into 2023. And again, so the first question earlier, really excited about what we’re seeing from product costs and hopefully seeing that benefit throughout 2023.
Corey Tarlowe: Great. Thanks so much. Very helpful. And best of luck.
Fran Horowitz: Thank you.
Operator: Paul Lejuez from Citi. Please go ahead.
Kelly Crago: Hi, this is Kelly Crago on for Paul. So I just wanted to follow up on, sort of, what you’re seeing from a promotional standpoint. So I guess you’re saying that the Hollister brand is more promotional year-over-year. And then I guess I’m just curious, relative to 2019, what those AURs look like? And then on the other side, A&F & was also — or was less promotional year-over-year, which is driving the higher AURs than I would assume that those AURs are up relative to 2019.
Scott Lipesky: Yes, Let me go on this one.
Fran Horowitz: Clarifying on the first point.
Scott Lipesky: Yes, on the first point, so when we talk about Hollister, we’re not more promotional. Our promotions this year for Black Friday will be consistent to last year, that promotion has started, which is good. where we might see some additional promotions or pricing actions versus last year will just be to continue to clean up that carryover inventory. So that’s where we’re assuming AURs will be down a little bit on a constant currency basis. We do have FX and as a continued hurt sadly here in Q4. So that’s going to hurt the AUR just on a currency basis. As we think about 2019, it’s — actually, we like where the AURs are, they’re up across brands. So even for Hollister in Q3, where we had a put more promotions on to move that back-to-school inventory.
Those AURs are still higher than 2020 — or I’m sorry, 2019 pre-pandemic, and Abercrombie up nicely as we kind of fully evolved that brand and that assortment. So loving the AURs that we’re seeing across brands, even in light of what we’ve had to do for Hollister more recently. And then getting back to that cost that’s coming back in to see gross margin going in a good direction go forward. And A&F talking about — sorry, just on A&F as we’ve been going through, we’ve been much less promotional year-over-year, that brand. Here the momentum that we’ve seen there has just been amazing. And we’ve been able to pull off promotions, both depth and frequency.
