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The TJX Companies, Inc. (NYSE: TJX) recently disclosed its financial results for the fourth quarter of Fiscal 2025, ending February 1, 2025. The company, a leader in off-price apparel and home fashions retail, reported net sales of $16.4 billion for the 13-week period. This figure remained consistent with the previous year’s 14-week quarter, highlighting stable performance despite the shorter period. Additionally, the company’s consolidated comparable store sales surged by 5%, demonstrating robust consumer engagement and an increase in customer transactions across its divisions.
Net income for the quarter amounted to $1.4 billion, with diluted earnings per share (EPS) reaching $1.23. This represents a slight increase compared to the previous year’s EPS of $1.22. When adjusted for the extra week in Fiscal 2024, the EPS growth is even more notable, rising by 10% from last year’s adjusted figure of $1.12. This growth underscores the company’s ability to maintain profitability and deliver value to its shareholders despite external challenges.
The quarter also saw a pretax profit margin of 11.6%, which exceeded the company’s internal expectations. This improvement was primarily driven by a reduction in inventory shrink expense and effective expense management, although higher incentive compensation accruals partially offset these gains. The gross profit margin for the quarter improved to 30.5%, reflecting a 0.7 percentage point increase from the previous year, further affirming the company’s strong operational performance.
TJX Beats Market Expectations with Fourth Quarter Results
The fourth quarter results of TJX surpassed market expectations, with the company achieving an EPS of $1.23 against the anticipated $1.16. This outperformance reflects TJX’s strategic execution and its ability to capitalize on consumer trends. The company’s revenue of $16.4 billion also exceeded the expected $16.19 billion, reinforcing its position as a dominant player in the retail sector.
The company’s performance was bolstered by a 5% increase in consolidated comparable store sales, driven entirely by heightened customer transactions. Each division recorded positive sales growth, with TJX Canada experiencing a remarkable 10% increase, showcasing the company’s strength in diverse markets. The Marmaxx division in the U.S. saw a 4% growth, while HomeGoods reported a 5% rise, indicating a broad-based improvement across its portfolio.
These results highlight TJX’s adeptness in navigating a competitive retail landscape, where consumer preferences are continually evolving. The company’s focus on offering value through a dynamic assortment of merchandise has resonated well with customers, leading to a significant uptick in sales and profitability. This success is a testament to TJX’s strategic initiatives and its commitment to delivering shareholder value.
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TJX Expects 2%-3% Increase in Comparable Store Sales for Fiscal 2026
TJX has provided guidance for the first quarter and full year of Fiscal 2026. The company anticipates a 2% to 3% increase in consolidated comparable store sales for the full year. The pretax profit margin is expected to range between 11.3% and 11.4%, slightly down from the previous year’s 11.5%. Despite this marginal decline, diluted EPS is projected to grow by 2% to 4%, reaching between $4.34 and $4.43.
For the first quarter of Fiscal 2026, TJX forecasts a 2% to 3% rise in comparable store sales. The company expects the pretax profit margin to be between 10.0% and 10.1%, a decrease from the prior year’s 11.1%. Diluted EPS for the quarter is anticipated to be between $0.87 and $0.89, which would represent a 4% to 6% decrease from the previous year’s $0.93. This outlook reflects the anticipated impact of foreign currency exchange rates and timing of certain expenses.
TJX’s forward-looking strategy includes plans to repurchase $2.0 to $2.5 billion of its stock during Fiscal 2026. The company also aims to increase its quarterly dividend by 13%, demonstrating its commitment to returning value to shareholders. This strategic focus on financial discipline and shareholder returns positions TJX well for continued success in the coming fiscal year.
Additionally, TJX’s investment in international ventures, such as its 35% stake in Brands for Less and a joint venture with Grupo Axo, underscores its commitment to growth beyond the U.S. These strategic investments are designed to leverage TJX’s expertise in off-price retailing and capitalize on emerging market opportunities.
Disclaimer: The author does not hold or have a position in any securities discussed in the article. All stock prices were quoted at the time of writing.
About the author
Tim Fries is the cofounder of The Tokenist. He has a B. Sc. in Mechanical Engineering from the University of Michigan, and an MBA from the University of Chicago Booth School of Business. Tim served as a Senior Associate on the investment team at RW Baird’s US Private Equity division, and is also the co-founder of Protective Technologies Capital, an investment firm specializing in sensing, protection and control solutions.
