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Ollie's Bargain Outlet Holdings, Inc. (OLLI)·Q1 2026 Earnings Summary

Executive Summary

  • Q1 2026 delivered revenue of $576.8M and adjusted EPS of $0.75, both above S&P Global consensus; revenue beat by ~$10.8M and EPS by ~$0.04, driven by new store openings and +2.6% comps led by transactions . Consensus: Revenue $565.9M*, EPS $0.709*; Actuals: Revenue $576.767M, EPS $0.75*. Values retrieved from S&P Global.
  • Gross margin was flat at 41.1% despite mix headwinds; SG&A rate rose 60 bps to 28.6% due to higher medical and casualty claims, while pre-opening expenses increased on accelerated store growth and $1.8M of dark rent tied to acquired Big Lots leases .
  • Guidance reaffirmed; management raised the FY net sales range ($2.579B–$2.599B from $2.564B–$2.586B) and nudged comps (1.4%–2.2% from 1.0%–2.0%), maintaining 40% gross margin and EPS range of $3.65–$3.75 .
  • Strategic catalysts: record 25 new stores opened (18 former Big Lots), Ollie’s Army loyalty enhancements including a June private event, and robust closeout pipeline; near-term watch items include seasonal volatility and tariff-driven mix dynamics .

What Went Well and What Went Wrong

What Went Well

  • Accelerated growth: “We opened 25 new stores in the first quarter, a record for any period in our history,” mostly former Big Lots sites with strong early performance . Total stores reached 584 (+13.2% YoY) .
  • Demand resilience: Net sales +13.4% to $576.8M and comps +2.6% on transaction growth; best categories included food, hardware, electronics, domestics, and housewares .
  • Value proposition and buying environment: Closeout pipeline “very strong,” supply chain costs lower than plan, and shrink better than anticipated supporting gross margin stability at 41.1% .

What Went Wrong

  • SG&A pressure: SG&A rate rose to 28.6% (+60 bps) driven by higher medical and casualty claims; management expects severity to peak in Q1 and moderate through the year .
  • Seasonal headwinds: Weather impacted certain seasonal categories in late Q1; seasonal selling remains a swing factor, and Q2 comps are expected at the low end of 1%–2% .
  • Pre-opening burden and dark rent: Pre-opening expenses increased to $6.7M (vs. $2.7M) on accelerated openings; dark rent tied to Big Lots leases was $1.8M in Q1, and ~$5M expected for FY 2025 .

Financial Results

MetricQ1 2025 (May 4, 2024)Q4 2025 (Feb 1, 2025)Q1 2026 (May 3, 2025)
Net Sales ($USD Millions)$508.818 $667.084 $576.767
Gross Margin (%)41.1 40.7 41.1
Operating Margin (%)11.1 13.2 9.7
Diluted EPS ($)$0.75 $1.11 $0.77
Adjusted EPS ($)$0.73 $1.19 $0.75
Adjusted EBITDA ($USD Millions)$69.431 $109.355 $72.159
Adjusted EBITDA Margin (%)13.6 16.4 12.5
Comparable Store Sales (%)+3.0 +2.8 +2.6
SG&A (% of Sales)28.0 25.5 28.6

KPIs and Balance Sheet

KPIQ3 2025 (Nov 2, 2024)Q4 2025 (Feb 1, 2025)Q1 2026 (May 3, 2025)
Stores at End of Period546 559 584
New Store Openings24 13 25
Ollie’s Army Members (Millions)14.8 >15.1 >15.5 (+9.2% YoY)
Cash + ST Investments ($USD Millions)$303.9 $428.7 $369.5
Total Cash & Investments ($USD Millions)—$428.7 $414.9
Inventories ($USD Millions)$607.331 $552.542 $611.852
Capex ($USD Millions)$31.0 $24.0 $26.740
Pre-opening Expenses ($USD Millions)$7.174 $4.824 $6.656
Share Repurchases ($USD Millions)$15.8 $5.7 $17.107

Estimates vs Actuals (Q1 2026)

MetricConsensus*ActualSurprise
Revenue ($USD)$565,948,600*$576,767,000 +$10,818,400*
Primary EPS ($)$0.709*$0.75*+$0.041*

Values retrieved from S&P Global.

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
New store openingsFY 202575 75 Maintained
Net salesFY 2025$2.564B–$2.586B $2.579B–$2.599B Raised
Comparable store salesFY 20251.0%–2.0% 1.4%–2.2% Raised
Gross marginFY 202540% 40% Maintained
Operating incomeFY 2025$283M–$292M $283M–$292M Maintained
Adjusted net incomeFY 2025$225M–$232M $225M–$232M Maintained
Adjusted EPSFY 2025$3.65–$3.75 $3.65–$3.75 Maintained
Effective tax rateFY 202525% (excl. excess stock comp) 25% (excl. excess stock comp) Maintained
Diluted weighted avg sharesFY 2025~62M ~62M Maintained
Capital expendituresFY 2025$83M–$88M $83M–$88M Maintained
Dark rent included in pre-openingFY 2025~$5M ~$5M Maintained
Interest income assumptionFY 2025~$17M ~$17M Maintained

Earnings Call Themes & Trends

TopicQ3 2025 (Prev Mentions)Q4 2025 (Prev Mentions)Q1 2026 (Current)Trend
Tariffs/macroFlexible buying; China ~15% direct imports; watch tariffs; disruption benefits closeouts Tariffs disruptive; potential back-half buying opportunity; comfortable with 40% GM Few million tariff impact YTD; plan for 40% GM; reduce China exposure to ~10% of mix Stable risk, mitigated; procurement shifting away from China
Supply chain costsFreight benefits moderating; DC capacity expanded (Princeton IL) Supply chain flattish; shrink softening; DC throughput strong Ocean contract favorable; domestic transport rates improving; DCs at record throughput Cost tailwinds modest; execution strong
Real estate/Big LotsAcquired 99 Cents and Big Lots leases; front-loaded 2025 openings 75 openings; dark rent ~$5M; Big Lots closures large share opportunity 25 Q1 openings (18 Big Lots); strong early performance; pipeline robust for 2026 Accelerating unit growth; market share capture
Loyalty/credit cardDigital marketing investments; younger cohort growth; credit card pilot progress Chain-wide rollout by end of Q1; higher baskets for cardholders June Ollie’s Army Night added; Ollie’s Days now member-exclusive; >15.5M members (+9.2% YoY) Program deepening; frequency and basket tailwinds
Consumables mixConsumables strength; merch margin mix drag Mix drag offset by lower supply chain costs; price follower strategy Best categories include food; maintain price gaps; robust CPG pipelines Mix shift sustained; drives traffic
Seasonal/ACWarm weather impacted Q3; Q4 flyer shift benefit AC drove strong comps; late Easter elongates spring season Weather impacted seasonal late Q1; Q2 comps lower end of 1%–2% Volatile; monitored
SG&A/claimsSG&A leverage point ~2% comp going forward SG&A leverage mid-point of 1%–2% comp in 2025; one-time award in Q4 SG&A up on medical severity; expected to moderate Temporary headwind; actions in place

Management Commentary

  • “We had a strong first quarter, highlighted by accelerated store growth and better than expected sales and earnings.” — Eric van der Valk, CEO .
  • “Gross margin was flat at 41.1%. Lower supply chain costs were offset by lower merchandise margin driven by changes in mix.” — Press release highlights .
  • “Our new stores are performing well, particularly the former Big Lots locations… Ollie’s Army members increased over 9% to 15.5 million.” — Robert Helm, CFO .
  • “We thrive on disruption… Good stuff cheap has been our mission from day one.” — Eric van der Valk, prepared remarks .

Q&A Highlights

  • Tariffs and pricing: Management is “fiercely committed” to maintaining price gaps; imports from China reduced to ~10% of mix for 2025 to mitigate tariffs .
  • Comp cadence: Q2 running ~+1% quarter-to-date; expect lower end of 1%–2% range given weather and seasonal timing; March saw mid-single-digit comp strength .
  • Big Lots impact: Liquidations created ~25 bps headwind to Q1 comps; ~400 overlapping stores seeing low-to-mid single-digit lift where closures are complete .
  • SG&A clarity: Medical claim severity drove Q1 SG&A pressure; expected to moderate through year; pre-opening/dark rent quantified and included in guidance .
  • Loyalty initiatives: June Army Night and Ollie’s Days member-exclusive to drive acquisition and retention; historically December event is the biggest—June event expected to be accretive though smaller .

Estimates Context

  • Q1 2026 beat on both revenue and EPS versus S&P Global consensus (Revenue: $576.8M vs $565.9M*, EPS: $0.75 vs $0.709*), supported by transactions-driven comp and accelerated unit growth . Values retrieved from S&P Global.
  • FY 2025 net sales range was raised and comps nudged higher; with gross margin held at 40%, consensus revenue estimates likely need upward revision while EPS ranges remain aligned to guidance .

Key Takeaways for Investors

  • Beat/raise quarter: OLLI delivered a clean beat on Q1 revenue/EPS and raised FY revenue/comps guidance while maintaining margin targets—positive for estimate revisions and sentiment .
  • Execution in accelerated growth: 25 Q1 openings (18 Big Lots) with strong early reads and robust 2026 pipeline; dark rent and pre-opening are near-term drags but set up earnings power beyond 2025 .
  • Mix and margin discipline: Flat 41.1% gross margin despite consumables mix; supply chain and shrink offsets, plus price-following discipline, underpin the 40% FY target .
  • SG&A watch: Elevated medical claims lifted SG&A; management expects moderation and is pursuing offsets—monitor quarterly flow-through .
  • Seasonal volatility: Weather-sensitive categories (AC, lawn & garden) can swing quarterly comps; management guides Q2 comps to low end with loyalty events helping offset .
  • Tariff mitigation: Reduced China exposure and flexible sourcing limit margin risk; potential for improved deal flow in back half if tariffs drive excess inventory .
  • Loyalty flywheel: >15.5M members, program enhancements, and credit card rollout drive frequency and basket—key drivers of traffic and comp durability .
Notes:
* Consensus values marked with an asterisk are retrieved from S&P Global.
Non-GAAP: Adjusted EPS excludes excess tax benefits from stock-based compensation; see reconciliation tables in the press release/8-K **[1639300_0001140361-25-021221_ef20049852_ex99-1.htm:4]** **[1639300_b0a5aef071fb4ab294db9b3b01cd87ba_7]**.