TJX Companies raised its annual profit forecast after reporting Q2 results for the period ended August 2 that topped company guidance. TJX opened four Sierra locations in the quarter and now has 127 doors at the midpoint of the year.

Consolidated net sales for the second quarter ended August 2 were $14.4 billion, an increase of 7 percent versus the second quarter of Fiscal 2025.  Wall Street’s consensus target had been $14.07 billion.

Second quarter consolidated comparable sales increased 4 percent, topping company guidance in the range of 2 percent to 3 percent growth.

Net income for the second quarter of Fiscal 2026 was $1.2 billion and diluted EPS were $1.10 per share, up 15 percent versus 96 cents per share in the second quarter of Fiscal 2025. TJX had guided EPS to come in the range of 97 cents to $1.00 with analysts expecting $1.01 per share on average.

For the first half of Fiscal 2026, net sales were $27.5 billion, an increase of 6 percent versus the first half of Fiscal 2025. First half Fiscal 2026 consolidated comparable sales increased 4 percent. Net income for the first half of Fiscal 2026 was $2.3 billion. First half Fiscal 2026 diluted earnings per share were $2.02, up 7 percent versus $1.89 in the first half of Fiscal 2025.

Ernie Herrman, chief executive officer and president of The TJX Companies, Inc., stated, “I am extremely pleased with our second quarter performance. Sales, pretax profit margin, and earnings per share were all above our plan. As we have seen through so many different retail and economic environments, consumers were drawn to our excellent values and brands. Customer transactions were up at every division as we saw strong demand at each of our U.S. and international businesses. Our teams across the Company successfully executed our off-price business fundamentals to deliver an exciting treasure hunt of merchandise at great value to our customers, every day. With our strong second quarter profit results, we are raising our full-year guidance for both pretax profit margin and earnings per share. The third quarter is off to a strong start, and I am very confident in our position as we enter the second half of the year. Our teams are energized by the opportunities we see in the marketplace for excellent brands and fashions and our initiatives to keep attracting shoppers to our retail brands. Longer term, we are convinced that we have a long runway ahead to capture additional market share and continue our successful growth around the world.”

Comparable Sales by Division
The company’s comparable sales by division for the second quarter of Fiscal 2026 and Fiscal 2025 were as follows:

Net Sales by Division
The company’s net sales by division for the second quarter of Fiscal 2026 and Fiscal 2025 were as follows:

Profitability
For the second quarter of Fiscal 2026, the company’s pretax profit margin was 11.4 percent, well above the company’s plan and 0.5 percentage points above last year’s second quarter pretax profit margin of 10.9 percent.

Gross profit margin for the second quarter of Fiscal 2026 was 30.7 percent, up 0.3 percentage points versus last year’s 30.4 percent, primarily due to favorable hedges. Merchandise margin was flat despite higher tariff costs versus last year.

Selling, general, and administrative (SG&A) costs as a percent of sales for the second quarter of Fiscal 2026 were 19.5 percent, a 0.3 percentage point decrease versus last year’s 19.8 percent. This was primarily driven by operational efficiencies as well as a benefit from the timing of certain expenses.

Net interest income negatively impacted second quarter Fiscal 2026 pretax profit margin by 0.1 percentage point versus the prior year.

The company’s second quarter Fiscal 2026 pretax profit margin was above the high-end of its plan by 0.9 percentage points. This was due to a combination of items including lower-than-expected tariff costs, expense leverage on above-plan sales, and the timing of certain expenses, partially offset by higher incentive compensation accruals and contributions to TJX’s charitable foundations.

Inventory
Total inventories as of August 2, 2025 were $7.4 billion, compared to $6.5 billion at the end of the second quarter of Fiscal 2025. Consolidated inventories on a per-store basis as of August 2, 2025, including distribution centers, but excluding inventory in transit and the company’s e-commerce sites, were up 10 percent on both a reported and constant currency basis versus last year. The company’s inventory position reflects the excellent buying opportunities the company saw in the marketplace during the second quarter. The company is seeing outstanding availability of quality, branded merchandise and is very well-positioned to flow fresh assortments to its stores and online throughout the fall and holiday season.

Cash and Shareholder Distributions
For the second quarter of Fiscal 2026, the company generated $1.8 billion of operating cash flow and ended the quarter with $4.6 billion of cash.

During the second quarter of Fiscal 2026, the company returned a total of $1.0 billion to shareholders. The company repurchased 4.1 million shares of TJX stock for a total of $515 million and paid $474 million in shareholder dividends.

During the first half of Fiscal 2026, the company returned a total of $2.0 billion to shareholders. The company repurchased 9.2 million shares of TJX stock for a total of $1.1 billion and paid $894 million in shareholder dividends.

The company continues to expect to repurchase approximately $2.0 to $2.5 billion of TJX stock during the fiscal year ending January 31, 2026. The company may adjust the amount purchased under this plan up or down depending on various factors. The company remains committed to returning cash to its shareholders while continuing to invest in the business to support the near- and long-term growth of TJX.

Fiscal  Third Quarter and Full Year 2026 Outlook
The company’s third quarter and full year Fiscal 2026 guidance below assumes that the current level of tariffs on imports into the U.S. as of August 20, 2025 will stay in place for the remainder of the year. The company’s guidance assumes that it can offset the significant pressure it expects from tariffs throughout Fiscal 2026.

For the third quarter of Fiscal 2026, the company expects consolidated comparable sales to be up 2 percent to 3 percent. The company is planning third quarter Fiscal 2026 pretax profit margin to be in the range of 12.0 percent to 12.1 percent, down 0.2 to 0.3 percentage points versus the prior year’s 12.3 percent. The company is planning third quarter Fiscal 2026 diluted earnings per share to be in the range of $1.17 to $1.19 per share, which would represent a 3 percent to 4 percent increase versus the prior year’s $1.14 per share.

For the full year Fiscal 2026, the company now expects consolidated comparable sales to be up 3 percent. The company is increasing its outlook for pretax profit margin to be in the range of 11.4 percent to 11.5 percent, flat to down 0.1 percentage point versus the prior year’s 11.5 percent. The company is also raising its diluted earnings per share outlook to be in the range of $4.52 to $4.57, which would represent a 6 percent to 7 percent increase over the prior year’s $4.26. The company’s full year Fiscal 2026 diluted earnings per share guidance now reflects the second quarter’s above-plan results as well as a smaller negative impact from unfavorable foreign currency exchange rates versus the company’s previous guidance.

Stores by Concept
During the fiscal quarter ended August 2, 2025, the Company increased its store count by 13 stores overall to a total of 5,134 stores and increased total square footage by 0.3 percent versus the prior quarter.

Image and tables courtesy TJX Companies