Ross Stores surged 9% in pre-market trading after reporting fiscal second-quarter earnings that exceeded expectations and raising its full-year guidance significantly.
The off-price apparel chain posted adjusted earnings per share of $2.66, topping the $1.94 consensus estimate, while revenue reached $6.3 billion, exceeding forecasts by about $150 million. Comparable-store sales rose 10%, marking the second straight quarter of double-digit growth driven by higher customer traffic, including new shoppers and returning lapsed customers.
Full-year EPS guidance was lifted to a range of $8.61 to $8.77 from the prior $7.50 to $7.74, implying roughly 31% growth versus the prior year—the strongest rate since 2022. The company also raised its 2026 store opening target to 115 locations from 110.
Ross Stores benefited from approximately $253 million in tariff refunds under the International Emergency Economic Powers Act, contributing about $0.60 per share to EPS and expanding operating margins by 405 basis points. Excluding this impact, underlying operating margin rose 205 basis points, ahead of internal plans. During the quarter, the company repurchased 1.4 million shares for $319 million.
CEO Jim Conroy noted that underlying metrics were "extremely positive across the board." The stock, which had traded between $143.39 and $257 over the past 52 weeks, approached the upper end of that range in early trading. The broader market showed modest gains, with the S&P 500 up 0.3%, the Dow Jones up 0.3%, and the Nasdaq up 0.4% in pre-market futures.
