US' TJX sees strong sales in Q2; upwardly revises FY26 forecast

The pretax profit margin in Q2 improved to 11.4 per cent, 0.5 percentage points (pp) higher than last year and 0.9 pp above plan, and gross margin rose to 30.7 per cent from 30.4 per cent, driven by favourable hedges, while selling, general and administrative (SG&A) expenses decreased to 19.5 per cent of sales from 19.8 per cent due to efficiencies. This was primarily driven by operational efficiencies as well as a benefit from the timing of certain expenses, The TJX Companies said in a press release.

Division-wise, Marmaxx (US) grew net sales 5 per cent to $8.8 billion on a 3 per cent comparable sales rise, while HomeGoods (US) gained 9 per cent to $2.3 billion on a 5 per cent increase. TJX Canada posted 11 per cent growth to $1.4 billion with 9 per cent comparable sales, and TJX International rose 13 per cent to $1.9 billion, up 7 per cent on a constant currency basis.

“I am extremely pleased with our second quarter performance. Sales, pretax profit margin, and earnings per share were all above our plan. As we have seen through so many different retail and economic environments, consumers were drawn to our excellent values and brands. Customer transactions were up at every division as we saw strong demand at each of our US and international businesses,” said Ernie Herrman, chief executive officer and president of The TJX Companies, Inc.

TJX added 13 stores in Q2, ending with 5,134 locations and 134.4 million square feet, led by expansions in TJ Maxx, HomeGoods, Sierra, Winners, and TK Maxx internationally.

For the first half of FY26, the company’s sales grew 6 per cent to $27.5 billion, with consolidated comparable sales up 4 per cent. Net income stood at $2.3 billion, and diluted EPS rose 7 per cent to $2.02. SG&A expenses of the company rose to $5.4 billion.

For full fiscal 2026, The TJX Companies expects consolidated comparable sales to rise 3 per cent. It has raised its pretax profit margin outlook to 11.4–11.5 per cent, flat to slightly below last year’s 11.5 per cent, and lifted diluted EPS guidance to $4.52–$4.57, up 6–7 per cent from $4.26. The improved EPS forecast reflects above-plan Q2 results and a smaller negative impact from foreign currency exchange rates.

For the third quarter (Q3) of FY26, TJX projects comparable sales growth of 2–3 per cent, pretax profit margin of 12–12.1 per cent versus 12.3 per cent last year, and diluted EPS of $1.17–$1.19, up 3–4 per cent from $1.14. These forecasts assume current US tariffs remain in place through FY26, with the company confident of offsetting their impact.

“With our strong second quarter profit results, we are raising our full-year guidance for both pretax profit margin and earnings per share. The third quarter is off to a strong start, and I am very confident in our position as we enter the second half of the year,” added Herrman. “Our teams are energised by the opportunities we see in the marketplace for excellent brands and fashions and our initiatives to keep attracting shoppers to our retail brands. Longer term, we are convinced that we have a long runway ahead to capture additional market share and continue our successful growth around the world.”

ALCHEMPro News Desk (SG)