Q4 2025 Earnings Summary
- Strong customer transaction growth and new customer acquisition, particularly among younger demographics (18 to 34 age range), leading to increased sales growth. Management highlighted that they continue to see strong transaction growth and are attracting more customers to their stores, especially in the 18 to 34 age demographic.
- Significant opportunities for store growth domestically and internationally, including expansion into new markets and smaller format stores, increasing the global store potential to 7,000 stores. The company plans to open 130 net new stores in fiscal '26. Management discussed opportunities to expand into smaller markets with smaller footprint stores and sees this as a significant growth opportunity.
- Favorable off-price retail environment positioning TJX to improve margins and capitalize on better buying opportunities. Management believes that the current environment is a "textbook off-price environment" with excellent availability of merchandise, allowing buyers to improve mark-on and gross margins.
- Increasing wage and payroll costs are expected to pressure margins in the upcoming fiscal year. TJX indicated that SG&A expenses are projected to rise due to incremental store wage and payroll costs and legislative increases effective in January. This is expected to result in 100 basis points of deleverage in Q1 pretax profit margin.
- Shrinkage remains an ongoing concern for TJX. While the company acknowledged improvements in shrink rates, they have not disclosed the current levels relative to pre-pandemic rates, indicating that inventory loss may continue to impact profitability.
- Potential tightness in real estate availability and competition for retail spaces could pose challenges for TJX's store expansion plans. While the company remains optimistic, questions were raised about limited new development and competition for spaces, which may lead to higher rent costs or difficulties in securing desirable locations.
| Metric | YoY Change | Reason |
|---|---|---|
Total Revenue | ~–0.4% (Q4 2025: $16,350M vs Q4 2024: $16,411M) | Total revenue remained essentially flat because modest growth in segments like HomeGoods (+1.6% YoY) was offset by slight declines in Marmaxx (–0.7% YoY) and TJX International (–1.1% YoY). This reflects a transition from previous periods where stronger comp sales and store expansion drove revenue, now balancing against regional and market headwinds. |
Operating Income | +11.8% (Q4 2025: $1,931M vs Q4 2024: $1,727M) | Operating income improved significantly due to better margin management and operational efficiencies, including cost control measures that built on prior period initiatives. The 11.8% gain highlights improved expense management and lower cost pressures relative to revenue, reinforcing continued benefits from earlier freight cost and SG&A controls. |
Net Income | ~–0.4% (Q4 2025: $1,398M vs Q4 2024: $1,403M) | Net income remained nearly flat despite operating improvements, suggesting that the cost savings and margin gains did not fully translate into bottom‐line growth. This may be due to persistent non-operating expenses or tax factors that offset gains seen in operating income compared to previous periods. |
Marmaxx Revenue | –0.7% (Q4 2025: $9,971M vs Q4 2024: $10,037M) | Marmaxx revenue declined slightly likely because the strong comp store performance and customer traffic seen in earlier periods began to level off. The minor dip indicates that previous growth drivers were not sustained, impacting overall revenue in this segment. |
HomeGoods Revenue | +1.6% (Q4 2025: $2,851M vs Q4 2024: $2,805M) | HomeGoods experienced modest growth thanks to continued customer traffic and enhancements in comp store performance that built on earlier momentum. This steady improvement contrasts with other segments and reflects ongoing recovery and strategic adjustments made in prior periods. |
TJX International Revenue | –1.1% (Q4 2025: $2,078M vs Q4 2024: $2,101M) | TJX International revenue dipped slightly as challenges such as foreign currency headwinds and regional market pressures re-emerged. Previous periods had benefited from favorable exchange impacts, but recent shifts in external conditions contributed to the modest decline in this segment. |
| Metric | Period | Previous Guidance | Current Guidance | Change |
|---|---|---|---|---|
Comp Store Sales Growth | Q1 FY 2026 | no prior guidance | 2% to 3% | no prior guidance |
Consolidated Sales | Q1 FY 2026 | no prior guidance | $12.8 billion to $12.9 billion | no prior guidance |
Pretax Profit Margin | Q1 FY 2026 | no prior guidance | 10% to 10.1% | no prior guidance |
Gross Margin | Q1 FY 2026 | no prior guidance | 29.8% to 29.9% | no prior guidance |
SG&A | Q1 FY 2026 | no prior guidance | 20% | no prior guidance |
Net Interest Income | Q1 FY 2026 | no prior guidance | $27 million | no prior guidance |
Tax Rate | Q1 FY 2026 | no prior guidance | 23.2% | no prior guidance |
Weighted Average Share Count | Q1 FY 2026 | no prior guidance | Approximately 1.13 billion shares | no prior guidance |
Diluted EPS | Q1 FY 2026 | no prior guidance | $0.87 to $0.89 | no prior guidance |
Comp Store Sales Growth | FY 2026 | no prior guidance | 2% to 3% | no prior guidance |
Consolidated Sales | FY 2026 | no prior guidance | $58.1 billion to $58.6 billion | no prior guidance |
Pretax Profit Margin | FY 2026 | no prior guidance | 11.3% to 11.4% | no prior guidance |
Gross Margin | FY 2026 | no prior guidance | 30.4% to 30.5% | no prior guidance |
SG&A | FY 2026 | no prior guidance | 19.3% | no prior guidance |
Net Interest Income | FY 2026 | no prior guidance | $98 million | no prior guidance |
Tax Rate | FY 2026 | no prior guidance | 25.1% | no prior guidance |
Weighted Average Share Count | FY 2026 | no prior guidance | Approximately 1.13 billion shares | no prior guidance |
Diluted EPS | FY 2026 | no prior guidance | $4.34 to $4.43 | no prior guidance |
Capital Expenditures | FY 2026 | no prior guidance | $2.1 billion to $2.2 billion | no prior guidance |
Net New Stores | FY 2026 | no prior guidance | ~130 | no prior guidance |
Stock Buybacks | FY 2026 | no prior guidance | $2 billion to $2.5 billion | no prior guidance |
Dividend Increase | FY 2026 | no prior guidance | 13% increase to $0.425 per share quarterly | no prior guidance |
| Metric | Period | Guidance | Actual | Performance |
|---|---|---|---|---|
Consolidated Sales | Q4 2025 | $15.9B–$16.1B | $16,350M | Beat |
Pretax Profit Margin | Q4 2025 | 10.8%–10.9% | 12.07% (1,973 ÷ 16,350) | Beat |
Gross Margin | Q4 2025 | 29.4%–29.5% | 30.47% ((16,350 – 11,371) ÷ 16,350) | Beat |
SG&A % of Sales | Q4 2025 | 18.8% | 19.16% (3,132 ÷ 16,350) | Missed |
Net Interest Income | Q4 2025 | $35M | $42M (Interest Expense = –$42M) | Beat |
Tax Rate | Q4 2025 | 26.0% | 29.1% ((1,973 – 1,398) ÷ 1,973) | Missed |
Diluted EPS | Q4 2025 | $1.12–$1.14 | $1.23 | Beat |
Consolidated Sales | FY 2025 | $55.9B–$56.1B | $56.36B (sum of Q1–Q4) | Beat |
Pretax Profit Margin | FY 2025 | 11.3% | 11.4% ((EBIT 6,525 – Interest Exp. 97) ÷ 56,360) | Beat |
Gross Margin | FY 2025 | 30.3% | 30.6% ((56,360 – 39,112) ÷ 56,360) | Beat |
SG&A % of Sales | FY 2025 | 19.3% | 19.4% (10,946 ÷ 56,360) | Missed |
Net Interest Income | FY 2025 | $174M | –$97M (sum of Q1–Q3 int. exp. + Q4 int. inc.) | Missed |
Tax Rate | FY 2025 | 25% | 24.3% (1,564 ÷ 6,428) | Beat |
Diluted EPS | FY 2025 | $4.15–$4.17 | ~$4.26 (sum of quarterly EPS) | Beat |
| Topic | Previous Mentions | Current Period | Trend |
|---|---|---|---|
Customer Transaction Growth | Consistently highlighted as the sole driver of comp store sales growth in Q1 ( ), Q2 ( ) and Q3 ( ); executives repeatedly emphasized that increasing customer transactions underpin overall growth. | Q4 earnings call emphasized strong customer transaction growth across all divisions driving comp sales increases ( ). | Steady and positive. The focus remains consistent, reinforcing that transaction growth is core to performance. |
Younger Demographic Acquisition | Mentioned in Q1 through the attraction of Gen Z and millennials ( ), in Q2 with an outsized number of younger customers ( ) and re‐emphasized in Q3 as part of a broad demographic strategy ( ). | Q4 reiterated that new customers are skewing towards the 18–34 age range, continuing the long‐term focus on younger demographics ( ). | Stable and optimistic. The company maintains its emphasis on attracting younger shoppers over multiple periods. |
Store Expansion | Q1 referenced potential for expanding by at least 1,300 additional stores ( ); Q2 celebrated the opening of the 5,000th store and outlined long-term growth prospects ( ); Q3 detailed plans—especially for the T.K. Maxx banner in Spain ( ). | Q4 laid out concrete targets to reach a long-term total of 7,000 stores with specific expansion figures for HomeGoods, Sierra, and international markets ( ). | Evolving and increasingly concrete. Initial ambitions have matured into detailed, quantified expansion plans. |
International Growth Opportunities | Q1 briefly mentioned international footprint growth ( ); Q2 introduced strategic global moves through a joint venture with Grupo Axo and an investment in Brands For Less ( ); Q3 expanded on international initiatives like entry into Spain ( ). | Q4 provided further details with plans to open stores in Spain in calendar 2026 and expanded joint venture/investment strategies in Europe and other regions ( ). | Growing strategic focus. The importance of international expansion has become more pronounced with detailed initiatives emerging over time. |
Margin Expansion Prospects | Q1 discussed margin expansion driven by freight efficiencies and better merchandise margins ( ); Q2 emphasized improvements from enhanced vendor relationships and operational efficiencies ( ); Q3 highlighted merchandise margin improvements supported by expense efficiencies ( ). | Q4 executives stressed optimism in merchandise margin expansion and pointed to shrink favorability contributing to a 100 basis point gross margin increase ( ). | Consistently optimistic. While cost pressures persist, efforts to boost margins (now with added shrink benefits) are emphasized across all periods. |
Cost and Wage Pressures | Q1 acknowledged rising wage costs with targeted market-by-market adjustments ( ); Q2 noted wage increases across geographies and related pressures ( ); Q3 mentioned that incremental wage and payroll costs partially offset other benefits ( ). | Q4 pointed to increased SG&A—up by 30 basis points and 10 basis points annually—primarily due to incremental wage and payroll costs and legislative wage increases ( ). | Persistent challenge. The cost pressures remain a consistent headwind, with Q4 showing slightly higher impacts despite offsetting measures. |
Rising Wage, Payroll, and Operating Cost Challenges | Q1 highlighted market-specific wage adjustments and noted incremental store wage costs ( ); Q2 described widespread wage increases (e.g., a 10% rise in the U.K. and in Canada) ( ); Q3 reiterated rising incremental costs impacting margins ( ). | Q4 reiterated that rising wage and payroll costs are impacting SG&A and forecast an 80 basis point increase in Q1 fiscal 2026, reflecting underlying operating cost challenges ( ). | Consistently worrisome. This challenge is repeatedly recognized and appears to be growing, underscoring its potential impact on future profitability. |
Shrinkage and Inventory Loss Management | Q1 focused on planning for flat shrink with initiatives such as body cameras to deter theft ( ); Q2 expected shrink to remain flat with modest inventory reductions at stores ( ); Q3 anticipated shrink to be flat year-over-year, with some negative impacts factored into Q4 forecasts ( ). | Q4 reported shrink favorability that contributed 20 to 100 basis points improvement in gross margin, signaling effective shrink management ( ). | Improving. While historically managed to be flat, Q4 shows positive momentum in shrink reduction, aiding margin expansion. |
Supply Chain Disruptions, Freight Costs, and Tariff Impacts | Q1 noted benefits from lower freight costs and cost efficiencies ( ); Q2 acknowledged lower freight costs but anticipated ocean freight increases later in the year ( ); Q3 referenced a “little bit of freight headwind” along with diversified sourcing to mitigate potential disruptions ( ). | Q4 maintained that lower freight costs helped improve gross margins, though a small negative impact from current China tariffs was expected in fiscal ‘26 ( ). | Well managed but with emerging headwinds. Overall effective supply chain management continues, though modest freight cost increases and minor tariff impacts are on the radar. |
Favorable Off-Price Retail Environment | Q1 underscored the flexibility and resilience of the off-price model, highlighting a “treasure hunt” experience ( ); Q2 emphasized the strong availability of quality branded merchandise and consumer demand for value ( ); Q3 stressed how the off-price model performs well in both strong and pressured economic environments ( ). | Q4 executives described the environment as “textbook” for off-price retail, with increased merchandise availability and opportunities for margin improvement, reinforcing the strength of the model ( ). | Consistently bullish. The sentiment remains highly positive, with Q4 enhancing the narrative around favorable market conditions boosting opportunities. |
Segment Performance Variability | Q1 compared HomeGoods’ strong comp sales and margin growth against slightly lower increases at Marmaxx ( ); Q2 noted that big-ticket items slowed HomeGoods relative to Marmaxx ( ); Q3 discussed differing comp sales growth and profit margins across segments with factors such as weather and structural differences playing roles ( ). | Q4 detailed that the margin gap between HomeGoods and Marmaxx has narrowed—thanks in part to the closure of homegoods.com—yet structural differences remain, particularly since Marmaxx benefits from higher-margin categories ( ). | Stable with gradual improvement. While structural differences persist, there is evidence of narrowing gaps and improved segment performance over time. |
Strategic Global Investments and Market Expansion Initiatives | Q1 offered only general comments on global store growth and a robust sourcing network ( ); Q2 introduced specific strategic investments such as the Grupo Axo joint venture in Mexico and the Brands For Less investment in Dubai ( ); Q3 built on these by outlining further expansion into new markets like Spain ( ). | Q4 provided comprehensive details—including targets for reaching 7,000 stores and specific international expansion plans, such as opening stores in Spain and enhancing joint ventures ( ). | Emerging into a clear strategic priority. Beginning with modest mentions in Q1, global investments and expansion initiatives have become highly detailed and central by Q4. |
Competitive Pressures from Online Retailers | In Q1, executives mentioned online competitors such as Temu and Shein, noting that these commodity-driven retailers do not significantly overlap with TJX’s branded “good, better, best” model ( ). | No discussion of online competitive pressures was noted in Q2, Q3, or Q4. | Diminished concern. Initially mentioned in Q1, the topic no longer appears in later periods, suggesting it has become a lower priority or less of a competitive threat. |
Limited Customer Data and Analytics Challenges | Q1 earnings call raised concerns about limited customer data due to lower credit card penetration and reliance on surveys, making it harder to track detailed consumer behavior ( ). | This topic was not mentioned in Q2, Q3, or Q4 earnings calls. | Disappeared as a focus. Initially flagged as an emerging concern in Q1, it is no longer discussed, indicating that it may have been mitigated or deprioritized in strategic discussions. |
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Merchandise Margins Expansion
Q: Expectations for merchandise margin expansion amid tariffs?
A: Management is optimistic about expanding merchandise margins. Direct imports from China are an extremely small percentage of their business, so tariffs have minimal impact. Their buyers focus on purchasing goods at costs that allow for strong value to consumers, regardless of tariffs or inflation. With consumer confidence down and more store closures, they anticipate increased buying opportunities, which should support margin expansion. -
Shrink Rate Improvement
Q: Expectations for shrink (inventory loss) rates this year?
A: They are pleased with shrink rates this year and have a small improvement included in their plan. They will continue analyzing data to enhance successful initiatives from last year, focusing on maintaining a great and safe shopping environment for customers and associates. -
International Performance
Q: Will strong Canada and Europe performance continue?
A: Yes, management is very pleased with both regions. They credit tactical execution in gift categories and strong home businesses for exceptional Q4 results. Seasoned management gives them confidence in continued strong execution over the next year. -
Real Estate Expansion Opportunities
Q: Is there real estate availability for expansion?
A: They see abundant real estate opportunities, especially in rural areas where department stores have closed. They can fill those voids and also relocate stores to better areas. This optimism is reflected in the increase to their store potential. -
Customer Behavior and Market Share
Q: Are you seeing trade-down at higher end or response to value offerings?
A: Performance is strong across all income levels. They saw nice increases in both below $100k and above $100k income areas. Market share gains, particularly in home categories due to other retailers' closures, are driving performance rather than demographic shifts. -
New Customer Acquisition
Q: Elaborate on new customer acquisition trends.
A: They continue to see strong transaction growth and are attracting more customers, especially in the 18 to 34 age range. Sales growth is driven by more customers visiting their stores. -
Product Assortment Breadth
Q: How is product assortment and value proposition for spring?
A: The breadth of product going into spring is kicked up a notch from last year. They continually expand their vendor base and categories, introducing new vendors and products without alienating existing customers, aiming to sell to as many people as possible. -
Category Performance and Outlook
Q: How did categories like apparel and home perform, and plans for 2026?
A: They were up in both apparel and home, with home and accessories performing stronger than apparel. They are very bullish on the home business, which is over one-third of TJX. Unique sourcing from Europe differentiates them from other retailers. They plan for these categories to perform strongly in FY '26.