Ross Stores Reports Robust First Quarter Sales and Earnings Results, Significantly Exceeding Guidance

Rhea-AI Summary

Ross Stores (Nasdaq: ROST) reported strong Q1 2026 results, with sales up 21% to $6.0 billion and comparable store sales up 17%. Diluted EPS rose 37% to $2.02 and operating margin reached 13.4%, above the 11.8%-12.1% plan.

Ross repurchased 1.5 million shares for $319 million and targets $1.275 billion in buybacks for fiscal 2026. For Q2 2026, it forecasts comparable sales growth of 6%-7% and EPS of $1.85-$1.93. Full-year 2026 EPS is projected at $7.50-$7.74, up 13%-17% from 2025.

Positive

• Q1 2026 sales grew 21% to $6.01 billion
• Comparable store sales increased 17% versus flat last year
• Q1 diluted EPS rose 37% to $2.02 from $1.47
• Operating margin of 13.4% exceeded 11.8%-12.1% plan
• Q2 2026 EPS guided to $1.85-$1.93 vs. $1.56 prior year
• Fiscal 2026 EPS outlook raised to $7.50-$7.74, up 13%-17%
• Strong operating cash flow of $836 million, up from $410 million
• Repurchased 1.5 million shares for $319 million in Q1
• Store count increased to 2,282 from 2,205 year over year
• Total long-term debt reduced to $776.8 million from $1.02 billion

Negative

• Selling, general and administrative expenses rose to $975.9 million from $797.1 million
• Cash, cash equivalents and restricted cash decreased by $462.8 million during the quarter
• Merchandise inventory increased to $2.98 billion from $2.67 billion year over year

News Market Reaction – ROST

+8.11%

23 alerts

+8.11% Session close to close

+3.5% Peak in 21 min

$75.96B Market Cap

0.3x Rel. Volume

In the May 22 session, ROST gained 8.11%, reflecting a notable positive market reaction. Argus tracked a peak move of +3.5% during that session. Our momentum scanner triggered 23 alerts that day, indicating elevated trading interest and price volatility.

Data tracked by StockTitan Argus on the day of publication.

Market Context

The stock moved +8.1% in the session following this news. A strong positive reaction aligns with Ros...

Analysis

The stock moved +8.1% in the session following this news. A strong positive reaction aligns with Ross Stores’ pattern of upside on earnings beats. Q1 2026 delivered sales of $6.0B, a 17% comp increase, and EPS of $2.02, all above guidance, alongside raised full-year EPS guidance to $7.50–$7.74. While past earnings beats have been met with positive moves, investors also weighed ongoing insider net selling and broader apparel retail strength when assessing durability.

Key Figures

Q1 2026 sales: $6.0B Q1 comp sales: 17% Operating margin: 13.4% +5 more

8 metrics

Q1 2026 sales $6.0B Sales increased 21% vs. $5.0B in Q1 2025

Q1 comp sales 17% Comparable store sales growth vs. flat last year

Operating margin 13.4% Q1 margin vs. 11.8%–12.1% company plan

Q1 diluted EPS $2.02 EPS up 37%, guidance was $1.60–$1.67

Q1 net income $649.964M Net earnings vs. $479.249M in Q1 2025

Share repurchases $319M 1.5M shares bought under $2.55B authorization in Q1 2026

FY 2026 EPS guidance $7.50–$7.74 Projected EPS vs. $6.61 for fiscal 2025

FY 2026 same-store outlook 6%–7% Raised same-store sales growth on top of 5% in 2025

Historical Context

5 past events · Latest: May 07 (Neutral)

Pattern 5 events

Date	Event	Sentiment	24h Move	Catalyst
May 07	Earnings call notice	Neutral	+0.6%	Scheduled date and webcast details for upcoming Q1 2026 earnings release.
Mar 09	Store expansion	Positive	+0.2%	Opening 17 new stores and outlining plan for ~110 additions in fiscal 2026.
Mar 03	Earnings beat	Positive	+8.0%	Q4 and FY 2025 sales, margins, EPS above guidance with higher capital returns.
Feb 17	Earnings call notice	Neutral	+1.1%	Announced timing and access details for Q4 and FY 2025 earnings call.
Jan 26	Leadership obituary	Neutral	-0.8%	Reported passing of former CEO and chairman and related commemorative actions.

24h Move is the share-price change in the day after each event; other market factors may also have contributed.

Pattern Detected

Recent news flow shows consistently positive reactions to strong earnings and growth updates, with prior upside guidance and expansion announcements followed by generally aligned, often positive, price moves.

Recent Company History

Over the last six months, Ross Stores has highlighted steady growth and operational strength. On Mar 3, 2026, it reported Q4 and fiscal 2025 earnings above guidance with higher shareholder returns. Earlier, store expansion news on Mar 9, 2026 reinforced its growth plan. Conference-call notices in February and May framed these results. Today’s strong Q1 beat and raised 2026 outlook extend this pattern of solid execution and growth communication.

Key Terms

comparable store sales, operating margin, earnings per share, diluted, +4 more

8 terms

comparable store sales financial

"Total sales for the first quarter of fiscal 2026 increased 21%... with comparable store sales up a very robust 17%"

Comparable store sales measure the change in revenue generated by stores that have been open for a certain period, typically at least one year. It helps assess how well a business is growing by showing whether existing stores are attracting more customers and sales, rather than just counting new store openings. Investors use this figure to gauge the true health and performance of a company's core operations over time.

operating margin financial

"First quarter operating margin of 13.4% was well above the Company's plan of 11.8% to 12.1%"

Operating margin shows how much profit a company makes from its core business activities after paying for costs like wages and materials. It’s useful because it tells you how efficiently a company is running—higher margins mean it keeps more money from each dollar of sales, which can indicate better management or stronger products.

View in glossary

earnings per share financial

"Earnings per share for the first quarter of $2.02 grew 37%, significantly exceeding guidance"

Earnings per share represent the amount of profit a company makes for each share of its stock, similar to how a pie’s total size can be divided into slices for each person. It helps investors understand how profitable the company is on a per-share basis, making it easier to compare its performance over time or against other companies. Higher earnings per share generally indicate better profitability and can influence a company's stock value.

View in glossary

diluted financial

"Diluted | | $ 2.02 | | $ 1.47"

Diluted describes how the value or claim of each existing share is reduced when additional shares could be issued or converted from things like stock options, warrants, or convertible debt. For investors it matters because diluted measures show a more complete picture of per-share earnings and ownership, like adding more slices to a pie so each slice becomes smaller — helping you judge how future share creation could lower your stake or earnings per share.

operating lease liabilities financial

"Current operating lease liabilities | | 735,528 | | 702,025"

Long-term lease payments a company is legally committed to because it rents assets such as offices, factories, or equipment; under modern accounting rules these future rent obligations are recorded on the balance sheet as liabilities. Investors care because operating lease liabilities act like debt that drains future cash, affects measures of leverage and borrowing capacity, and can change profitability and valuation — think of them as a company’s large, ongoing rent payments that limit its financial flexibility.

Form 10-K regulatory

"Other risk factors are set forth in our SEC filings including the Form 10-K for fiscal 2025"

A Form 10-K is a comprehensive report that publicly traded companies are required to file annually with regulators. It provides a detailed overview of a company's financial health, operations, and risks, similar to a detailed health report. Investors use this information to assess the company's performance and make informed decisions about buying or selling its stock.

forward-looking statements regulatory

"This press release and the related conference call remarks contain forward-looking statements regarding, without limitation, projected sales"

Forward-looking statements are predictions or plans that companies share about what they expect to happen in the future, like estimating sales or profits. They matter because they help investors understand a company's outlook, but since they are based on guesses and assumptions, they can sometimes be wrong.

off-price technical

"our need to attract, train, and retain associates with the retail talent necessary to execute our off-price retail strategies"

Off-price describes a retail strategy where goods are sold at marked-down prices compared with regular retail, often because items are excess, last season’s, or bought in bulk at a discount; think of it like buying last year’s model at a steep sale. Investors care because off-price channels can drive steady sales and higher margins when managed well, act as a bargain-driven growth lever, and can signal shifts in consumer demand or inventory health.

AI-generated analysis. How Rhea-AI works. Not financial advice.

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Provides Solid Second Quarter Guidance and Increases Fiscal 2026 Outlook

DUBLIN, Calif., May 21, 2026 /PRNewswire/ -- Ross Stores, Inc. (Nasdaq: ROST) today reported financial results for the 13‑week quarter ended May 2, 2026.

Highlights:

• Total sales for the first quarter of fiscal 2026 increased 21% compared to last year, with comparable store sales up a very robust 17%
• First quarter operating margin of 13.4% was well above the Company's plan of 11.8% to 12.1%, primarily from the strong sales outperformance
• Earnings per share for the first quarter of $2.02 grew 37%, significantly exceeding guidance of $1.60 to $1.67 

Jim Conroy, Chief Executive Officer, commented, "We achieved outstanding sales and earnings results in the first quarter with superb execution throughout the business, especially the transition of our Spring assortment. Momentum was solid throughout the quarter, with broad-based strength across the business. Customer traffic was the primary driver of the strong sales trend as compelling merchandise assortments, higher customer acquisition and engagement from our ongoing marketing initiatives, and an improved in‑store experience are resonating with shoppers. We believe our results also benefited from higher consumer spending related to tax refunds."

First Quarter Results

Sales increased 21% to $6.0 billion, up from $5.0 billion in 2025. Comparable store sales rose a very robust 17% for the quarter versus flat sales last year. Net income was $650 million versus $479 million last year, while earnings per share increased 37% to $2.02, compared with $1.47 per share in the prior year period.

Update on Shareholder Payouts

During the first quarter of fiscal 2026, a total of 1.5 million shares of common stock were repurchased for an aggregate price of $319 million under the Company's two-year $2.55 billion authorization approved by its Board of Directors in March 2026. The Company remains on track to buy back a total of $1.275 billion in common stock during fiscal 2026.

Fiscal 2026 Guidance

Mr. Conroy commented, "Looking ahead, we exited the first quarter with solid momentum, and our underlying business fundamentals remain very strong. As such, for the 13 weeks ending August 1, 2026, comparable store sales are forecasted to increase 6% to 7%. If sales perform in line with this forecast, earnings per share are projected to be $1.85 to $1.93 or growth of 19% to 24%, compared to $1.56 for the second quarter ended August 2, 2025."

Mr. Conroy continued, "Based on our first quarter results and our second quarter guidance, we are increasing our 2026 fiscal year same store sales growth to 6% to 7% on top of a 5% gain in 2025. As a result, fiscal 2026 earnings per share are now projected to be in the range of $7.50 to $7.74, or growth of 13% to 17% when compared to $6.61 for the fiscal year ended January 31, 2026."

Mr. Conroy concluded, "The year is off to a very strong start with the entire organization executing at a high level. As our efforts to improve topline growth continue, we remain focused on disciplined, consistent execution across the business. Moving forward, we believe we are well positioned to capture additional market share and drive profitable growth over the long term."

The Company will host a conference call on Thursday, May 21, 2026 at 4:15 p.m. Eastern time to provide additional details concerning its first quarter results and management's outlook for the second quarter. A real-time audio webcast of the conference call will be available in the Investors section of the Company's website, located at www.rossstores.com. An audio playback will be available at 201-612-7415, PIN #13760373 until 8:00 p.m. Eastern time on May 28, 2026, as well as on the Company's website.

Forward-Looking Statements:  This press release and the related conference call remarks contain forward-looking statements regarding, without limitation, projected sales, costs and earnings, planned new store growth, capital expenditures, liquidity and other matters. These forward-looking statements reflect our then-current beliefs, plans, and estimates with respect to future events and our projected financial performance, operations, and competitive position, and they are subject to risks and uncertainties which could cause our actual results to differ materially from management's current expectations. The words "plan," "expect," "target," "anticipate," "estimate," "believe," "forecast," "projected," "guidance," "outlook," "looking ahead," and similar expressions identify forward-looking statements. Risk factors for Ross Dress for Less^® ("Ross") and dd's DISCOUNTS^® include without limitation, risk from adverse changes in the macroeconomic environment, government regulations and policies, geopolitical conditions, and financial and credit markets; continuing inflation and other external economic events and trends may have significant negative effects on our costs, and also on consumer confidence, shopping behavior, and spending; tariff increases (or threats of increases), and other changes and uncertainty in U.S. trade or tax policy regarding apparel, home-related merchandise, shoes, and other goods we sell that is produced in other countries; competitive pressures and the pace of change in the retailing industry; unexpected changes in the level of consumer spending or preferences; adverse or unseasonable weather may affect shopping patterns and consumer demand for seasonal apparel and other merchandise, and may result in temporary store closures and disruptions in deliveries of merchandise to our stores; our dependence on the market availability, quantity, and quality of attractive brand name merchandise at desirable discounts, and on the ability of our buyers to source and purchase merchandise to enable us to offer customers a wide assortment of merchandise at competitive prices; our need to expand in existing markets and enter new geographic markets in order to achieve growth; our need to obtain acceptable new store sites with favorable consumer demographics in order to achieve growth; our need to continually attract, train, and retain associates with the retail talent necessary to execute our off-price retail strategies, as well as labor shortages, increased turnover, or increased labor costs; our need to effectively manage our inventories, markdowns, and inventory shortage in order to achieve our planned gross margins; information or data security breaches, including cyberattacks on our transaction processing and computer information systems, including malware intrusion, data exfiltration, identity theft, and other types of cybersecurity threats, could disrupt our operations, result in theft or unauthorized disclosure of our confidential and valuable business information or credit card and other customer information, and could disrupt our operations, damage our reputation, increase our costs, and create significant legal exposure; disruptions in our supply chain or in our information systems could impact our ability to process sales and to deliver product to our stores in a timely and cost-effective manner; risks associated with importing and selling merchandise produced in other countries; damage to our corporate reputation or brands; a natural or man-made disaster in a region where we have a concentration of stores, offices, or a distribution center; consumer problems or legal issues involving the quality, safety, or authenticity of products we sell could harm our reputation, result in lost sales, and/or increase our costs; an adverse outcome in various legal, regulatory, or tax matters, could damage our reputation or brand and increase our costs. Other risk factors are set forth in our SEC filings including the Form 10-K for fiscal 2025 and fiscal 2026 Form 8-Ks on file with the SEC. The factors underlying our forecasts and plans are dynamic and subject to change. As a result, any forecasts or forward-looking statements speak only as of the date they are given and do not necessarily reflect our outlook at any other point in time. We disclaim any obligation to update or revise these forward-looking statements.

About Ross Stores, Inc.
Ross Stores, Inc. is an S&P 500, Fortune 500, and Nasdaq 100 (ROST) company headquartered in Dublin, California, with fiscal 2025 revenues of $22.8 billion. Currently, the Company operates Ross Dress for Less^® ("Ross"), the largest off-price apparel and home fashion chain in the United States with 1,917 locations in 44 states, the District of Columbia, Guam, and Puerto Rico. Ross offers first-quality, in-season, brand name and designer apparel, accessories, footwear, and home fashions for the entire family at savings of 20% to 60% off department and specialty store regular prices every day. The Company also operates 365 dd's DISCOUNTS^® stores in 23 states that feature a more moderately-priced assortment of first-quality, in-season apparel, accessories, footwear, and home fashions for the entire family at savings of 20% to 70% off moderate department and discount store regular prices every day. Additional information is available at www.rossstores.com.

Ross Stores, Inc.
Condensed Consolidated Statements of Earnings
					Three Months Ended
($000, except stores and per share data, unaudited)					May 2, 2026		May 3, 2025
Sales					$                 6,010,476		$                 4,984,971
Costs and Expenses
	Cost of goods sold				4,230,589		3,581,366
	Selling, general and administrative				975,861		797,135
Operating income					804,026		606,470
Interest income, net					(33,449)		(34,409)
Earnings before taxes					837,475		640,879
Provision for taxes on earnings					187,511		161,630
Net earnings					$                   649,964		$                   479,249
Earnings per share
	Basic				$                         2.04		$                         1.48
	Diluted				$                         2.02		$                         1.47
Weighted-average shares outstanding (000)
	Basic				318,957		324,877
	Diluted				321,231		327,005
Store count at end of period					2,282		2,205

 

Ross Stores, Inc.
Condensed Consolidated Balance Sheets
($000, unaudited)				May 2, 2026		May 3, 2025
Assets
Current Assets
	Cash and cash equivalents			$                 4,130,980		$                 3,783,413
	Accounts receivable			212,540		181,004
	Merchandise inventory			2,976,958		2,669,849
	Prepaid expenses and other			252,941		240,837
		Total current assets		7,573,419		6,875,103
Property and equipment, net				4,147,666		3,827,541
Operating lease assets				3,531,945		3,325,849
Other long-term assets				301,542		276,123
Total assets				$               15,554,572		$               14,304,616
Liabilities and Stockholders' Equity
Current Liabilities
	Accounts payable			$                 2,653,741		$                 2,163,954
	Accrued expenses and other			696,511		616,008
	Current operating lease liabilities			735,528		702,025
	Accrued payroll and benefits			376,760		274,877
	Income taxes payable			210,971		180,083
	Current portion of long-term debt			241,344		498,812
		Total current liabilities		4,914,855		4,435,759
Long-term debt				776,843		1,016,897
Non-current operating lease liabilities				2,969,435		2,797,935
Other long-term liabilities				292,944		268,698
Deferred income taxes				295,492		209,249
Commitments and contingencies
Stockholders' Equity				6,305,003		5,576,078
Total liabilities and stockholders' equity				$               15,554,572		$               14,304,616

 

Ross Stores, Inc.
Condensed Consolidated Statements of Cash Flows
				Three Months Ended
($000, unaudited)				May 2, 2026		May 3, 2025
Cash Flows From Operating Activities
Net earnings				$                   649,964		$                   479,249
Adjustments to reconcile net earnings to net cash provided by operating activities:
	Depreciation and amortization			132,599		115,938
	Stock-based compensation			59,120		39,296
	Deferred income taxes			34,065		22,209
	Change in assets and liabilities:
		Merchandise inventory		(345,988)		(225,336)
		Other current assets		(50,547)		(58,426)
		Accounts payable		262,115		67,182
		Other current liabilities		(57,344)		(173,946)
		Income taxes		153,136		139,086
		Operating lease assets and liabilities, net		(2,104)		1,351
		Other long-term, net		993		3,112
		Net cash provided by operating activities		836,009		409,715
Cash Flows From Investing Activities
Additions to property and equipment				(208,954)		(207,378)
		Net cash used in investing activities		(208,954)		(207,378)
Cash Flows From Financing Activities
Issuance of common stock related to stock plans				6,616		6,143
Treasury stock purchased				(134,171)		(60,131)
Repurchase of common stock				(318,750)		(262,521)
Dividends paid				(143,559)		(133,300)
Payment of long-term debt				(500,000)		(700,000)
		Net cash used in financing activities		(1,089,864)		(1,149,809)
Net decrease in cash, cash equivalents, and restricted cash and cash equivalents				(462,809)		(947,472)
Cash, cash equivalents, and restricted cash and cash equivalents:
		Beginning of period		4,661,973		4,796,462
		End of period		$                 4,199,164		$                 3,848,990
Reconciliations:
	Cash and cash equivalents			$                 4,130,980		$                 3,783,413
	Restricted cash and cash equivalents included in prepaid expenses and other			21,137		17,050
	Restricted cash and cash equivalents included in other long-term assets			47,047		48,527
Total cash, cash equivalents, and restricted cash and cash equivalents:				$                 4,199,164		$                 3,848,990
Supplemental Cash Flow Disclosures
Interest paid				$                     19,839		$                     35,939
Income taxes paid, net				$                          309		$                          334

 

Contacts:	William W. Sheehan II	Connie Kao
	Executive Vice President,	Senior Vice President, Investor Relations
	Chief Financial Officer	(925) 965-4668
	(925) 965-4150	connie.kao@ros.com

 

View original content:https://www.prnewswire.com/news-releases/ross-stores-reports-robust-first-quarter-sales-and-earnings-results-significantly-exceeding-guidance-302779470.html

SOURCE Ross Stores, Inc.

FAQ

How did Ross Stores (ROST) perform financially in Q1 2026?

Ross Stores reported strong Q1 2026 financial performance, with double-digit growth in sales and earnings. According to Ross Stores, sales rose 21% to $6.01 billion, net income reached $649.9 million, and diluted EPS increased 37% to $2.02 versus $1.47 last year.

What were Ross Stores (ROST) Q1 2026 comparable store sales results?

Ross Stores delivered robust Q1 2026 comparable store sales growth. According to Ross Stores, comps increased 17% for the quarter, compared with flat comparable store sales in the prior-year period, driven primarily by higher customer traffic and broad-based strength across the business segments.

What Q2 2026 guidance did Ross Stores (ROST) provide for sales and earnings?

For Q2 2026, Ross Stores expects continued growth in sales and earnings. According to Ross Stores, comparable store sales are forecast to rise 6%-7%, with projected EPS between $1.85 and $1.93, compared with $1.56 earned in the second quarter of 2025.

How has Ross Stores (ROST) updated its fiscal 2026 earnings outlook?

Ross Stores raised its fiscal 2026 earnings outlook based on Q1 results and Q2 guidance. According to Ross Stores, full-year EPS is now projected at $7.50-$7.74, representing 13%-17% growth over the $6.61 earned in fiscal 2025.

What share repurchase activity did Ross Stores (ROST) report for Q1 2026?

Ross Stores continued returning capital through share repurchases in Q1 2026. According to Ross Stores, it bought back 1.5 million shares of common stock for $319 million and remains on track to repurchase a total of $1.275 billion in common stock during fiscal 2026.

What was Ross Stores (ROST) operating margin in Q1 2026 versus plan?

Ross Stores achieved an operating margin above its internal plan in Q1 2026. According to Ross Stores, operating margin reached 13.4% for the quarter, exceeding the company’s projected range of 11.8% to 12.1%, primarily due to stronger-than-expected sales performance.

How did cash flow and debt levels change for Ross Stores (ROST) in Q1 2026?

Ross Stores generated higher operating cash flow and reduced long-term debt in Q1 2026. According to Ross Stores, net cash from operating activities was $836 million, up from $409.7 million, while long-term debt declined to $776.8 million from $1.02 billion a year earlier.