tapebrief
TJX · Q1 2027

TJX · Q1 2026 Earnings

Cautious

TJX Companies

Reported May 21, 2025

30-second summary

Q1 delivered a 3% consolidated comp on $13.1B revenue (+5% YoY) with GAAP EPS of $0.92 and a 10.3% pretax margin — solid but unremarkable for TJX. The signal worth paying attention to is the Q2 pretax margin guide of 10.4–10.5%, which management explicitly framed as the trough quarter for direct tariff costs tied to pre-tariff order commitments. Full-year guidance (EPS $4.34–$4.43, pretax margin 11.3–11.4%, comps +2–3%) was reaffirmed, meaning the back half must do real work to offset Q2 — a credible plan, but one with execution risk if tariff clarity doesn't improve.

Headline numbers

EPS

Q1 FY2026

$0.92

Revenue

Q1 FY2026

$13.11B

+5.0% YoY

Gross margin

Q1 FY2026

29.5%

Key financials

Q1 FY2026
MetricQ1 FY2026YoY
Revenue$13.11B+5.0%
EPS$0.92—
Gross margin29.5%—

Guidance

Prior quarter data unavailable — comparison not possible.

Segment performance

Q1 FY2026
SegmentQ1 FY2026YoY
Marmaxx (U.S.)$8.052B+4.0%
HomeGoods (U.S.)$2.254B+8.0%
TJX Canada$1.144B+3.0%
TJX International (Europe & Australia)$1.661B+8.0%

Platform metrics

Q1 FY2026
SegmentQ1 FY2026
Comparable Sales Growth3%
Store Count5,121
Gross Square Feet134.0 million
Inventory per Store (% change)+7%

Profitability

Q1 FY2026
SegmentQ1 FY2026
Pretax Profit Margin10.3%
SG&A as % of Sales19.4%
Operating Cash Flow$394 million

Other KPIs

Q1 FY2026
SegmentQ1 FY2026
Shareholder Returns$1.0 billion

Management tone

The Q&A is the only meaningful management commentary available this quarter, and the dominant analyst preoccupation was tariffs — all six exchanges with Bank of America, JP Morgan, Barclays, Citi, Morgan Stanley, and BMO Capital Markets touched the same nerve. Management's posture was consistently confident but more operationally specific than rhetorical: rather than reassuring analysts the off-price model is "resilient," executives walked through concrete mechanics — direct imports under 10% of the business held there by design, buying "more hand-to-mouth" with strategically delayed upfront commitments, willingness to "shift to adjacent categories" if a sourcing pocket tightens.

The most revealing tonal note was the explicit framing of Q2 as the margin trough. Management told JP Morgan's Matthew Boss that "Q2 is most impacted by direct tariff costs from pre-tariff commitments" with mitigation already underway and a Q1 inventory hedge mark-to-market reversal expected to land favorably in the back half. That's an unusually specific cadence call from a company that typically lets numbers speak — and it suggests management wanted to pre-commit to an H2 recovery narrative before the Q2 print arrived.

Comparisons to the 2018–19 tariff period came up repeatedly, and management was careful to distinguish the two. In 2018, "mostly negotiated tariffs with vendors"; today, "more likely to use retail adjustment selectively." The unsaid implication: some tariff cost will reach the consumer this cycle, but selectively, preserving what management called the "wow factor" — a target of "one in ten hangers" priced sharply enough to feel "almost too cheap." That is a different playbook than 2018, and analysts should not assume the same margin elasticity.

Q&A highlights

Lorraine Hutchinson · Bank of America

How has the inventory availability environment changed given delayed shipments, tariff uncertainty, and vendor hesitancy? What pricing adjustments might be needed in the back half to offset tariffs?

Management acknowledged the environment is different from past decades due to broader inflation and tariffs. Noted vendors are seeing uneasiness about future tariff clarity. TJX sees even more inventory availability going forward and will leverage flexibility to shift to adjacent categories if needed. Emphasized maintaining value gap with traditional retailers and willingness to adjust retail selectively while buying profitably, sometimes pricing items very sharply to create 'wow factor' for customers.

Direct imports less than 10% of businessBuying more hand-to-mouth and calling back upfront buying strategicallyWill maintain significant gap between TJX and traditional retail pricingMerchants work retail backwards, not cost-plus focused

Matthew Boss · JP Morgan

Can you detail MarMax comp progression in March/April relative to early quarter weather disruption and strong Q2 start? What about gross margin progression for the balance of the year?

Management confirmed MarMax comps improved month-to-month as weather improved in Q1 and strength continued into Q2. Every division is participating in growth. For margins, management explained Q2 is most impacted by direct tariff costs from pre-tariff commitments; mitigation efforts offset most impact; negative hedge mark-to-market in Q1 will reverse favorably in back half; front-half negatively impacted by prior year favorable freight accrual reversals.

All divisions showing positive comp salesQ2 is most tariff-impacted quarter due to pre-tariff order commitmentsSignificant mitigation efforts underway for Q2 and continuing into back halfQ1 negative inventory hedge mark-to-market will reverse favorably in back half

Adrienne Yay · Barclays

How will pricing and vendor negotiations compare to 2018-19 tariff period? What levers are available—maintain margin or trade margin for comps? Can you elaborate on flexibility?

Management noted current environment differs from 2018-19: more widespread tariff impact, overlaid on existing inflation from prior years. In 2018, mostly negotiated tariffs with vendors; today, more likely to use retail adjustment selectively. Key levers: buying more profitably in current market, strengthening vendor relationships (they see TJX as consistent partner), maintaining flexibility to shift categories. Emphasized merchants don't use fixed markup—they retail backwards based on market value, seeking to create items that feel 'almost too cheap' to drive traffic and wow factor.

Current tariff environment more widespread than 2018-19Overlaid on inflation that began several years agoStrong vendor relationships creating pricing flexibilityBuyers trained to retail backwards, not cost-plus

Paul Leshway · Citi

What percentage of product is directly sourced and how might that change? Are you buying less upfront in anticipation of better deals later? What signs of income demographic shifts in demand?

Direct sourcing is less than 10% and maintained at that level intentionally for brand balance. Currently buying more hand-to-mouth and pulling back upfront buying strategically by category. Saw strong sales across all income demographic bands in Q1 with slight lean toward lower income. All divisions and geographies participating. Marketing campaigns (e.g., 'What Makes You You' at HomeGoods, 'Hustlers' at Marshalls) aimed at acquiring customers from traditional retail.

Direct sourcing: less than 10% of business, held stable by designBuying closer to market, pulling back upfront buying by category/departmentStrong sales across all income bands; slight lean toward lower incomeEvery division and geography participating in growth

Alex Stratton · Morgan Stanley

How do you think about HomeGoods margin trajectory for rest of year? Is low-teens margin achievable? Given home and toys are China-sourced and important for holiday, how are you managing tariff impact?

Management expressed confidence in continued HomeGoods margin improvement, driven by top-line sales opportunities and productivity initiatives. For home, emphasized most sourced through third-party vendors negotiating with China factories; many vendors provide flexibility if availability tightens; can shift to other home categories. Toys more China-dependent and fewer branded vendors; if toy retails rise elsewhere, TJX will adjust appropriately but anticipates less unit flow offset by strength in other categories. No substantial obstacles foreseen for home; cautiously monitoring toys but confident in vendor relationships.

HomeGoods comp outpacing home industryHome margin improvement expected from top-line sales and productivityHome sourcing: mostly third-party vendors, not direct China exposureToys: China-sourced, fewer branded vendors, cautiously monitored

What to watch into next quarter

Q2 pretax margin lands within the 10.4–10.5% guide — management has explicitly framed this as the tariff trough. A miss below 10.4% would call into question whether the FY 11.3–11.4% guide is achievable and force a hard look at the back-half math.

Marmaxx comp acceleration — Q1 comp was +2% with management citing month-to-month improvement and Q2 starting strong. Watch for Marmaxx comp at or above the consolidated +3%; a sub-3% Marmaxx print again would suggest the largest segment is structurally lagging, not weather-recovering.

Inventory per store trajectory — Q1 at +7% per store is consistent with management's thesis that tariff disruption is loosening availability. If this figure expands further in Q2, expect commentary on whether TJX is leaning into opportunistic buys versus holding receipts tight.

HomeGoods margin and comp sustainability — +4% comp with segment margin up 70bps to 10.2% and management calling out further margin improvement. Watch for whether HomeGoods comp stays above Marmaxx and whether segment profit margin shows visible expansion in the Q2 disclosure.

Any change to the $2.0–$2.5B repurchase pace — $1.0B returned in Q1 puts TJX on the high end of the annual range. Acceleration would signal management's confidence in FY cash generation; deceleration would be a quiet tell on tariff cost realization.

Sources

  1. TJX Companies Q1 FY2026 Earnings Press Release, filed 2025-05-21. https://www.sec.gov/Archives/edgar/data/109198/000010919825000037/tjxq1fy26earningspressrele.htm
  2. TJX Companies Q1 FY2026 Earnings Call Q&A — analyst exchanges with Bank of America, JP Morgan, Barclays, Citi, Morgan Stanley, and BMO Capital Markets.

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