US' Ross Stores lifts FY25 outlook after strong Q3 momentum

For Q3 Ross posted sales of $5.6 billion, up from $5.07 billion a year earlier, reflecting a 10 per cent increase and a 7 per cent rise in comparable store sales. Net earnings for Q3 stood at $511.9 million, compared with $488.8 million in the previous year. Earnings per share (EPS) were $1.58, which includes a negative impact of about $0.05 per share from tariff-related costs, versus $1.48 in Q3 FY24.

The cost of goods sold rose to $4.03 billion, up from $3.63 billion, while selling, general and administrative expenses increased to $920 million from $833 million. Operating income improved to $648.5 million. Earnings before taxes reached $682.4 million, and after-tax provisions of $170.5 million, net income totalled $511.9 million, Ross Stores said in a press release.

For the first nine months (9M) of FY25, Ross generated sales of $16.12 billion, up from $15.22 billion in 2024, with comparable store sales rising 3 per cent. Year-to-date net earnings were $1.50 billion, with diluted EPS of $4.61 compared with $4.53 a year earlier. Tariff-related costs reduced year-to-date earnings by approximately $0.16 per share. Operating income for the period reached $1.89 billion, compared with $1.85 billion last year.

Ross ended the period with 2,273 stores, compared with 2,192 a year earlier.

“We are pleased with our third quarter sales results, which accelerated from the prior quarter. Our merchandise assortment of compelling brand name values resonated with shoppers, and our new marketing campaign drove excitement and higher customer engagement. We had an excellent back-to-school season with strong trends that continued through the balance of the quarter,” said Jim Conroy, chief executive officer (CEO) at Ross Stores.

“The strong execution by the entire team led to broad-based sales growth across merchandise areas and geographical regions. The strength in top-line, coupled with our continued focus on expense control, resulted in an operating margin of 11.6 per cent that was much stronger than expected,” added Conroy.

Ross continued its shareholder return programme during Q3, repurchasing 1.7 million shares for $262 million under its two-year $2.1 billion buyback authorisation. The company remains on track to repurchase $1.05 billion in FY25.

For the 13 weeks ending January 31, 2026, the company now expects comparable store sales to rise 3 to 4 per cent, with earnings per share between $1.77 and $1.85. The guidance includes a $0.03 unfavourable timing impact from packaway expenses (discounted merchandise bought early and stored for future seasonal selling), while tariff effects are set to be negligible.

“We enter the holiday season with strong momentum and are well-positioned to offer a compelling merchandise assortment across all our stores,” said Conroy.

For full FY25, Ross has raised its full-year earnings forecast to $6.38–6.46 per share, despite a $0.16 negative impact from tariff-related costs. By comparison, last year’s Q4 and full-year figures of $1.79 and $6.32 per share included a $0.14 benefit from the sale of a packaway facility.

ALCHEMPro News Desk (SG)