Ross Stores posted better-than-expected third-quarter results, with homewares a little soft but improving.
Net earnings were $511.9 million, or $1.58 per diluted share, versus $488.8 million, or $1.48 per diluted share, in the year-earlier quarter, the company reported.
A MarketBeat-published analyst consensus estimate had earnings per diluted share at $1.38 and revenues at $5.38 billion.
Comparable sales gained 3% in the quarter, year over year, Ross noted. Sales were $5.6 billion versus $5.07 billion in the year-previous period. Operating income was $648.5 million versus $604.2 million in the year-before quarter.
Along with the financial results, Jim Conroy, Ross CEO, announced that the company had raised its guidance for the full fiscal year based on recent financial results, with earnings per share not to fall in a range of $6.38 to $6.46, “which includes approximately 16 cents per share negative impact from tariff-related costs. In addition, and as a reminder, 2024 fourth quarter and full year earnings per share of $1.79 and $6.32, respectively, included an approximate 14 cents earnings per share benefit related to the sale of a packaway facility.”
Earlier, Ross had fiscal year earnings per share guidance of $6.08 to $6.21.
In a conference call, Conroy said that the company’s home business came in slightly below the chain average in the third quarter but has been building momentum since the second quarter.
Conroy, in announcing the financial results, said, “We are pleased with our third quarter sales results, which accelerated from the prior quarter. Our merchandise assortment of compelling brand-name values resonated with shoppers, and our new marketing campaign drove excitement and higher customer engagement. We had an excellent back-to-school season with strong trends that continued through the balance of the quarter. The strong execution by the entire team led to broad-based sales growth across merchandise areas and geographical regions. The strength in top-line, coupled with our continued focus on expense control, resulted in an operating margin of 11.6% that was much stronger than expected.”
As for the holiday season, Conroy said that the company is optimistic about its prospects, with chances enhanced “by our ongoing focus on delivering quality, branded merchandise at exceptional value. This approach continues to gain strong traction with the consumer, particularly in an environment of rising prices across mainstream retail. Additionally, the store and supply chain teams are well-positioned for the holiday season, and our new marketing campaigns have continued to build excitement. We believe that this multi-faceted approach will help us continue our positive momentum and enable us to capture additional market share.”
