American Eagle Outfitters Inc., which saw third-quarter earnings drop dramatically and posted a 17 percent decline in sales at established stores in the first half of November, has decided it's time to slow down new store growth.

The South Side teen retailer plans to open 12 new American Eagle stores in the next fiscal year, compared with 35 this year. The move, which follows similar steps taken by many other chains, including Findlay-based Dick's Sporting Goods, will reduce costs and preserve capital as the economy continues its slide.

In another move to brace for changing shopper priorities, the retailer's spring assortment will be heavy on "value" items.

"Consumers are seeking lower prices and trusted value more than ever before," said Jim O'Donnell, chief executive officer, in a conference call to discuss earnings with analysts.

Meanwhile, the retailer laid out the details of its challenging third quarter, which ended Nov. 1. Net income came in at $42.6 million, or 21 cents per share, compared with $99.4 million, or 45 cents, in the year-ago period.

Excluding a 9-cent-per-share impairment charge related to auction rate securities, earnings would have met the 30-cent average estimate from analysts polled by Thomson Financial Network. American Eagle lowered its guidance to that level earlier this month.

Total sales for the quarter rose 1 percent to $754 million from $744.4 million, while sales in established stores fell 7 percent. The company said higher markdowns hurt profit margins.

The retailer continues to struggle with its women's clothing sales, a problem that has continued through the year. Jeans -- long a strength -- have been especially disappointing, said Mr. O'Donnell. Men's clothing did better.

November started off the fourth quarter in dreary fashion but the teen clothier will hold off giving earnings guidance until results from the critical Thanksgiving weekend can be tallied.

American Eagle shares closed up 71 cents, or 8.5 percent, to $9.06.