TJ Maxx, Marshalls slowdown shadows TJX earnings beat as spending tapers
TJX•Quarterly sales and profit top estimates
Quarterly net sales rose 5.4% to $15.18 billion, narrowly beating estimates of $15.16 billion. Adjusted earnings per share rose 11% to $1.22, above expectations of $1.19.
Tariff refunds and bonus expenses affect outlook
The company expects tariff refunds to lower merchandise costs in the third quarter, although partly offset by higher incentive compensation and bonus expenses.
Excluding an expected net benefit of six cents from tariff refunds, TJX sees third-quarter adjusted earnings per share of $1.30 to $1.32, compared with analyst expectations of $1.35, according to LSEG data.
It expects earnings per share for fiscal 2027 between $5.31 and $5.36, compared with $5.08 to $5.15 forecast earlier.
TJX reports slowdown at Marmaxx despite earnings beat
TJX Companies on Wednesday reported a slowdown at its TJ Maxx and Marshalls discount apparel chains in the second quarter, overshadowing strong growth in its home goods business and fueling concerns about a pullback in U.S. consumer spending.
While the off-price retailer is still drawing in bargain-hunting shoppers, its core apparel-focused Marmaxx division is facing headwinds ahead of the crucial back-to-school and holiday seasons. Shares of the company fell 1% in morning trading.
The weak U.S. apparel results clouded TJX's earnings beat. The Framingham, Massachusetts-based company also raised its annual profit forecast and maintained its comparable store sales target for growth between 3% and 4%.
Competition and consumer caution weigh on apparel sales
TJX faces mounting competition from value retailers Ross Stores and Burlington Stores as consumers grow more selective with discretionary purchases amid economic uncertainty and a softer labor market.
