In the first quarter, Burlington Stores beat Wall Street on earnings but just missed on revenues, although both metrics gained year over year. CEO Michael O’Sullivan reaffirmed guidance, maintaining that the company can handle tariff pressure on margins.
Net income for the quarter was $100.8 million, or $1.58 per diluted share, versus $78.5 million, or 1.22 per diluted share, in the year-previous period. Adjusted for one-time charges, net income was $107 million, or $1.67 per diluted share, versus $91 million, or 1.42 per diluted share, for the fiscal 2024 period, the company stated.
An analyst consensus estimate published by Yahoo Finance had Burlington earnings per adjusted diluted share at $1.43 and revenues at $2.53 billion.
Comparable sales in the quarter were flat year over year, the company reported. Net revenue was $2.5 billion versus $2.36 billion in the year-earlier period, according to the company.
O’Sullivan, CEO, said as he announced the first quarter results, “The environment has become more uncertain since March, especially with regard to tariffs. We anticipate that tariffs will put significant pressure on our merchandise margin, but we are confident that, as long as tariffs do not increase from current levels, we can offset this pressure elsewhere in the P&L. These offsets, together with our Q1 earnings favorability, provide a path to achieving our original guidance.”
He added, “The changing landscape of tariffs creates risks and opportunities for our business. We have many advantages that traditional retailers do not have. We can move more rapidly and more flexibly. The next several months could be challenging, but if we navigate this well, then we expect to come out ahead. It is important to look through the short-term disruption caused by tariffs. Whatever level tariffs settle at, vendors will adjust and relocate to the lowest cost source of production. We do not believe that tariffs are going to change the longer-term structural dynamics of the retail industry. These dynamics are driving the growth of off-price retail and our business. We are excited by and focused on our long-term full potential.”
As for his view of the quarter, O’Sullivan said, “Total sales increased 6% and comparable store sales were flat for the first quarter, in line with the midpoint of our guidance. Adjusted EBIT margin and EPS were ahead of guidance, with approximately half of this beat to guidance coming from favorable timing of expenses that will negatively impact Q2.”
