This quarter, we delivered record revenue of $1.27 billion, reflecting growth at 24% from 2020, and an increase of 19% to 2019.
Record operating income of $210 million, reflecting a margin at 16.5%, our highest rate since 2007.
The processes, disciplines and capabilities we have put in place over the past 18 months will continue to set us apart, fueling strong returns and taking AEO to even greater heights.
Acquiring Quiet allows us to build on the efficiencies we've gained over the past 12 months and position us for success as we grow our business over the coming years.
28% revenue growth in the third quarter following a 34% increase last year demonstrates Aerie's strong growth path.
Profit flow-through was also very healthy with a 16.5% operating margin, reflecting new third quarter highs for the brand.
We achieved this despite some unevenness of inventory flow during factory shutdowns in South Vietnam.
Year-to-date, Aerie's customer file has expanded 15%.
We opened 29 new Aerie doors in the quarter, including a mix of new stand-alone and side-by-side formats, roughly a quarter of them are OFFLINE doors.
I'm thrilled with the great progress we're making just 11 months into the launch of our new strategy.
Sales in the quarter rose 21% compared to 2020 and increased 8% to 2019.
This resulted in significant profit flow-through and operating margin of 27.8% that reflected new highs.
We are pleased to see store traffic rebuild rising in the double-digits, driving a 29% increase in store revenue.
Our digital business continued at a healthy pace with revenues up 10%, successfully lapping 29% growth in the prior year.
Year-to-date, digital penetration is 35%, and our trailing 12-month digital revenue is approximately $1.8 billion with very strong profitability.
Over the past 12 and 24 months, we added almost 1.75 million and 2.25 million new customers, respectively.
Approximately a third are engaging across both brands and spending approximately 2 times that of our average customer annually.
Delivery costs leveraged 120 basis points in the quarter.
However, as Jen discussed, Aerie's legging category experienced uneven inventory flows when factory closures in Vietnam created product delays.
Revenue of $1.27 billion, operating income of $210 million and adjusted earnings per share of $0.76 marked third quarter records for the company.
Gross margin of 44.3% and operating margin of 16.5% hit their strongest levels since 2007.
Consolidated third quarter net revenue increased $242 million or 24% versus third quarter 2020 and is up $208 million or 19% from 2019.
Across brands, sales metrics were very favorable, strong demand, higher full price sales and fewer promotions drove the average unit retail up 15% and fueled a high single-digit increase in our average transaction value.
Revenue rose 28% from third quarter 2020 and over 70% from third quarter 2019.
Aerie's operating profit rose 46% and the operating margin expanded to 16.5%, marking a new third quarter high.
Incremental freight costs were $5 million or a 170 basis point headwind to brand operating margins in the quarter.
The third quarter saw a significant profit unlock at AE as top line grew 21% and operating profit jumped 68%.
Operating margins hit a remarkable 27.8%.
As Jen mentioned, with improvements across key categories, the top line grew 8% against 2019.
Total company consolidated gross profit dollars were up 36% compared to the third quarter of 2020, reflecting a 44.3% gross margin rate.
As a result of strong sales, we saw SG&A leverage 190 basis points.
The dollar increase of $41 million was due primarily to higher store payroll, especially as we lapped capacity constraints last year as well as new store openings and increased advertising.
Record operating income of $210 million reflected a 16.5% operating margin, our highest third quarter rate since 2007.
Adjusted earnings per share was $0.76 per share, marking a record third quarter.
Our diluted share count was 205 million and included 34 million shares of unrealized dilution associated with our convertible notes.
Ending inventory was up 32% compared to a 13% decline last year.
The increased freight costs had about a 10 point impact on ending inventory at cost.
Our balance sheet remains healthy and we ended the quarter with $741 million in cash, up from $692 million in the third quarter 2020.
Capital expenditures totaled $58 million in the quarter and $144 million year-to-date.
For 2021, we continue to capital expenditures to come in on the low end of our $250 million to $275 million guidance range, reflecting cost savings and project timing.
Due to backlogs in building materials and fixtures, several of our third quarter store openings shifted into the fourth quarter, we expect the majority of these stores to open by the end of the year.
However, that has come with additional freight costs in the range of $70 million to $80 million, which will impact the fourth quarter.
Of course, we expect to nicely exceed $600 million of operating income for the year, well above the $550 million 2023 target.

Summary:
This quarter, we delivered record revenue of $1.27 billion, reflecting growth at 24% from 2020, and an increase of 19% to 2019.
We achieved this despite some unevenness of inventory flow during factory shutdowns in South Vietnam.
Year-to-date, Aerie's customer file has expanded 15%.
Our digital business continued at a healthy pace with revenues up 10%, successfully lapping 29% growth in the prior year.
However, as Jen discussed, Aerie's legging category experienced uneven inventory flows when factory closures in Vietnam created product delays.
Across brands, sales metrics were very favorable, strong demand, higher full price sales and fewer promotions drove the average unit retail up 15% and fueled a high single-digit increase in our average transaction value.
Revenue rose 28% from third quarter 2020 and over 70% from third quarter 2019.
Adjusted earnings per share was $0.76 per share, marking a record third quarter.
Ending inventory was up 32% compared to a 13% decline last year.
Due to backlogs in building materials and fixtures, several of our third quarter store openings shifted into the fourth quarter, we expect the majority of these stores to open by the end of the year.
However, that has come with additional freight costs in the range of $70 million to $80 million, which will impact the fourth quarter.
Of course, we expect to nicely exceed $600 million of operating income for the year, well above the $550 million 2023 target.