TJX Cos Inc shares declined about 4% in premarket trading on Wednesday after the off-price retailer reported a second-quarter earnings beat but issued a third-quarter profit outlook below analyst expectations.
The company posted adjusted diluted earnings per share of $1.22 for the quarter ended Aug. 2, beating the $1.19 consensus estimate. Revenue totaled $15.2 billion, roughly in line with the $15.19 billion forecast. Consolidated comparable sales increased 4%, exceeding the company’s plan.
Profitability improved, with adjusted pretax profit margin rising 0.5 percentage points to 11.9% and adjusted gross profit margin up 0.7 percentage points to 31.4%, driven by higher merchandise margins.
CEO Ernie Herrman highlighted the above-plan results, noting that consolidated comparable sales growth of 4% and earnings per share well above expectations reflected strong execution. The company also raised its long-term global store target to 7,500 and plans to accelerate store growth to 4% annually beginning in fiscal 2028.
For the current quarter, TJX guided adjusted diluted EPS to $1.30–$1.32, below the $1.34 consensus estimate. Consolidated comparable sales growth is expected to slow to 2%–3%, while adjusted pretax profit margin is projected to reach 12.3%–12.4%, aided by additional tariff refunds under the International Emergency Economic Powers Act (IEEPA).
Full-year fiscal 2027 guidance was raised to $5.15–$5.20 in adjusted diluted EPS, up from the prior range of $5.08–$5.15 but still below the $5.22 analyst estimate. Comparable sales growth is maintained at 3%–4%, and adjusted pretax profit margin is expected to improve to 12.0%–12.1%.
