Fewer customers are shopping at American Eagle Outfitters, and the teen retailer expects a big drop in profit in the current quarter as it deals with tough competition.

The company's outlook for its fiscal third quarter, which runs through October, is also well below Wall Street's view. Shares are down 7.5 percent in Wednesday premarket trading.

For the quarter that ended Aug. 3, net income rose 3 percent to $19.6 million, or 10 cents per share. Revenue fell 2 percent to $727.3 million. A key revenue figure that tracks sales in established stores dropped 7 percent

Pittsburgh-based American Eagle Outfitters Inc. is the latest retailer to post disappointing results. Chains including Wal-Mart, Kohl's, Macy's and Saks have cut their outlook for the year, raising worries about consumer spending.