(Reuters) -Abercrombie & Fitch raised its annual sales forecast on Wednesday, betting on robust demand for its Hollister brand of dresses and jeans as shoppers prioritize spending on trendy apparel undeterred by price hikes.

The company, whose denim jeans sell at an average $100, has been able to drive growth at its eponymous and Hollister brands by targeting affluent female shoppers, who make up a majority of the company’s customer base.

The apparel retailer now expects net sales for fiscal year 2025 to grow in the range of 5% to 7%, compared to its prior forecast of a 3% to 6% increase.

The outlook assumes costs of about $90 million related to tariffs on goods imported into the United States according to trade policies as of August 25, the company said.

(Reporting by Savyata Mishra in Bengaluru; Editing by Leroy Leo)