Hot Topic taps into retail gloom

Hot Topic-brand beaded necklaces hang on a rack at a Hot Topic retail store.

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Steve Chiotakis: Maybe it's time to check out the mall again. Uh, like, it's a totally rad place -- dude. Forgive me; that's about the best teenage impersonation I've got.

Teens love to be stylin'. And that means shopping at those indoor mall stores for tank tops, tees and jeans with the holes already in 'em. But it's the darker, edgier clothes that seem to be grabbing the green these days. And the earnings reports of two active wear retailers are likely to highlight the difference. Here's Marketplace's Renita Jablonski.


Renita Jablonski: The clothes at Pacific Sunwear, or PacSun, are probably what you imagine -- surfer-inspired colors and patterns. The company's stock is down about 90 percent for the year and analysts aren't expecting to see a glimpse of sun in third quarter earnings.

Then there's Hot Topic, a little more goth, lots of black -- not only the clothes, but it's bottom line. Analysts predict the dark horse will be a winner in the third quarter.

This song from the band "The Faceless" is featured on Hot Topic's Web site, a music genre called technical death metal.

Adrienne Tennant: I do subscribe to the tough economic times can translate into maybe a little bit more desire to be darker, a little more somber.

That's Adrienne Tennant, senior analyst for specialty apparel at Friedman, Billings, Ramsey.
She says Hot Topic sales were up more than 8 percent last month when other teen retailers were flailing. Halloween definitely helped and Tennant says the teen vampire movie "Twilight," which opens this week, will keep the store busy beyond the fourth quarter.

In Los Angeles, I'm Renita Jablonski for Marketplace.

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