Five Below Reports 24% Q4 Sales Surge, Opens 150 New Stores with 75bp Margin Gain
Five Below delivered Q4 sales growth of 24% and comparable sales up 15.4%, expanding operating margin by 75 basis points to nearly 10% and growing adjusted EPS by 32%. The retailer opened 150 net stores (8.5% increase) and cautioned on tougher year-over-year comparisons in the back half of 2026.
1. Record Q4 Performance
Five Below achieved its strongest holiday quarter since going public, with total sales rising 24% and comparable sales up 15.4%. Operating margin expanded by 75 basis points to just under 10%, while adjusted EPS climbed 32%, highlighting both top-line strength and improved profitability.
2. Strategic Marketing and Customer Engagement
The company’s new focus on Gen Alpha, Gen Z and millennial parents drove higher traffic and transaction trends. Investments in social media, influencer partnerships and CRM data capture amplified user-generated content, fueling momentum in popular categories like squishy toys.
3. Store Expansion and Investment
During the quarter Five Below opened 150 net new locations, an 8.5% increase that included several grand openings in the Pacific Northwest. The rollout is supported by expanded distribution capacity and technology upgrades aimed at sustaining growth in new and existing markets.
4. Outlook and Caution
Management expects tougher year-over-year sales comparisons in the back half of 2026 following 2025’s strong performance. Planned investments in marketing, labor and capital expenditures are designed to balance reinvestment with bottom-line growth in a challenging macroeconomic environment.