Dillard’s, Inc. reported earnings slid 5 percent in the fourth quarter as higher gross margins were offset by a 1 percent same-store sales decline and higher payroll costs.

For the year, profits were down 3.9 percent on flat sales, flat gross margins and higher expenses.

Dillard’s Chief Executive Officer William T. Dillard, II, commented, “We reported a respectable year. We achieved a retail gross margin of 40.8 percent in a rapidly changing merchandising environment with unpredictable costs. We rewarded our shareholders with the largest dividend in our history and still held around $1.1 billion in cash and short-term investments at year-end.”

Highlights of the Fiscal Year
(compared to the prior fiscal year)

  • Total retail sales were unchanged as a percentage.
  • Comparable store sales were unchanged as a percentage.
  • Net income of $570.2 million compared to $593.5 million.
  • Earnings per share of $36.42 compared to $36.82.
  • Retail gross margin of 40.8 percent of sales, compared to 41.0 percent of sales.
  • Operating expenses were $1.759 billion (27.2 percent of sales) compared to $1.731 billion (26.7 percent of sales).
  • Ending inventory increased 2 percent.

Fiscal Year Results
Dillard’s reported net income for the 52 weeks ended January 31, 2026, of $570.2 million, or $36.42 per share, compared to $593.5 million, or $36.82 per share, for the 52 weeks ended February 1, 2025.

Included in net income for the 52 weeks ended January 31, 2026, are the following items:

  • A pretax gain of $20.4 million ($15.7 million after tax or $1.00 per share), primarily related to the sale of five properties.
  • Federal and state income tax benefits of $35.0 million ($2.24 per share) due to a deduction related to that portion of the special dividend of $30.00 per share that was paid to the Dillard’s, Inc. Investment and Employee Stock Ownership Plan during the year.

Included in net income for the 52 weeks ended February 1, 2025, are federal and state income tax benefits of $30.8 million ($1.91 per share) due to a deduction related to that portion of the special dividend of $25.00 per share that was paid to the Dillard’s, Inc. Investment and Employee Stock Ownership Plan during the quarter.

Sales for Fiscal Year
Net sales for the 52 weeks ended January 31, 2026, and February 1, 2025, were $6.474 billion and $6.483 billion, respectively. Net sales include the operations of the company’s construction business, CDI Contractors, LLC (CDI).

Total retail sales, excluding CDI, for the 52 weeks ended January 31, 2026, and February 1, 2025, were $6.232 billion and $6.219 billion, respectively. Total retail sales were unchanged as a percentage for the 52-week period ended January 31, 2026, compared to the 52-week period ended February 1, 2025. Sales in comparable stores for the same period were unchanged as a percentage.

Gross Margin for Fiscal Year
Consolidated gross margin for the 52 weeks ended January 31, 2026, was 39.5 percent of sales compared to 39.5 percent of sales for the 52 weeks ended February 1, 2025.

Retail gross margin, excluding CDI, for the 52 weeks ended January 31, 2026, was 40.8 percent of sales, compared to 41.0 percent for the 52 weeks ended February 1, 2025.

Inventory increased 2 percent at January 31, 2026, compared to February 1, 2025.

Selling, General & Administrative Expenses for Fiscal Year
Consolidated selling, general and administrative expenses (Operating Expenses) for the 52 weeks ended January 31, 2026, were $1.759 billion (27.2 percent of sales) compared to $1.731 billion (26.7 percent of sales) for the 52 weeks ended February 1, 2025.

Highlights of the Fourth Quarter
(compared to the prior year fourth quarter)

  • Total retail sales decreased 1 percent.
  • Comparable store sales decreased 1 percent.
  • Net income of $203.7 million compared to $214.4 million.
  • Earnings per share of $13.05 compared to $13.48.
  • Retail gross margin of 36.1 percent of sales compared to 36.1 percent of sales.
  • Operating expenses were $463.0 million (23.6 percent of sales) compared to $452.0 million (22.4 percent of sales).

Fourth Quarter Results
Dillard’s reported net income for the 13 weeks ended January 31, 2026, of $203.7 million, or $13.05 per share, compared to $214.4 million, or $13.48 per share, for the 13 weeks ended February 1, 2025. Included in net income for the 13 weeks ended January 31, 2026, are the following items:

  • A pretax gain of $14.9 million ($11.5 million after tax or $0.73 per share), primarily related to the sale of a store property.
  • Federal and state income tax benefits of $35.0 million ($2.24 per share) due to a deduction related to that portion of the special dividend of $30.00 per share that was paid to the Dillard’s, Inc. Investment and Employee Stock Ownership Plan during the quarter.

Included in net income for the 13 weeks ended February 1, 2025, are federal and state income tax benefits of $30.8 million ($1.94 per share) due to a deduction related to that portion of the special dividend of $25.00 per share that was paid to the Dillard’s, Inc. Investment and Employee Stock Ownership Plan during the quarter.

Sales for Fourth Quarter
Net sales for the 13 weeks ended January 31, 2026, and February 1, 2025, were $1.962 billion and $2.017 billion, respectively.

Total retail sales for the 13 weeks ended January 31, 2026, and February 1, 2025, were $1.916 billion and $1.943 billion, respectively. Total retail sales decreased 1 percent for the 13-week period ended January 31, 2026, compared to the 13-week period ended February 1, 2025. Sales in comparable stores for the same period decreased 1 percent. The company notes that sales in over a third of its stores were disrupted by a winter storm event in the third weekend of January 2026.

Compared with the prior-year fourth quarter, sales increased moderately in ladies’ accessories and lingerie. Sales were unchanged as a percentage of shoes sold, with moderate declines noted in ladies’ apparel, cosmetics, men’s apparel and accessories, juniors’ and children’s apparel, and home and furniture.

Gross Margin for Fourth Quarter
Consolidated gross margin for the 13 weeks ended January 31, 2026, was 35.4 percent of sales compared to 34.9 percent of sales for the 13 weeks ended February 1, 2025.

Retail gross margin for the 13 weeks ended January 31, 2026, was 36.1 percent of sales, compared to 36.1 percent for the 13 weeks ended February 1, 2025. Compared to the prior year fourth quarter, retail gross margin increased moderately in ladies’ apparel and juniors’ and children’s apparel. Retail gross margin was unchanged in ladies’ accessories and lingerie, shoes, cosmetics, and home and furniture. Retail gross margin declined moderately in men’s apparel and accessories.

Selling, General & Administrative Expenses for Fourth Quarter
Operating expenses for the 13 weeks ended January 31, 2026, were $463.0 million (23.6 percent of sales) and $452.0 million (22.4 percent of sales) for the 13 weeks ended February 1, 2025. The increase is notably due to payroll and payroll-related expenses.

Share Repurchase
During the 52 weeks ended January 31, 2026, the company purchased $107.8 million, roughly 300,000 shares, of Class A Common Stock at an average price of $359.16 per share.

As of January 31, 2026, $165.2 million in authorization remained under the May 2023 program.

Total shares outstanding (Class A and Class B Common Stock) at January 31, 2026, and February 1, 2025, were 15.6 million and 15.9 million, respectively.

Store Information
The company plans to open a 160,000-square-foot store at The Mall at Fairfield Commons in Beavercreek, OH, in March 2026. The company operates 271 Dillard’s stores, including 28 clearance centers, spanning 30 states, totaling 46.0 million square feet, and an online store at dillards.com.

Image courtesy Dillards