TJX earnings analysis
What we found in TJX's 10-Q: the parts that mattered, the offsets in the same document, and what the company said about what comes next.
Our reading of the filing · Free to read, no account needed
TJX delivered strong second-quarter growth, with revenue up 5% to $15,180 million, diluted EPS up 24% to $1.36, and substantial gross and pre-tax margin expansion. HomeGoods and TJX International led segment growth, while cash generation improved materially and the company continued investing in stores and returning capital. The principal qualification is that $219 million of net tariff-refund benefit supported results, with no assurance that additional refunds will recur; the filing itself reports no material changes to prior risk factors.
The parts that mattered.
Pulled out of the filing itself, with the figures the company reported.
- Sales and comps accelerated
- Second-quarter net sales rose 5% year over year to $15,180 million from $14,401 million, with consolidated comparable sales up 4%. Versus the immediately preceding quarter in the supplied history, revenue increased from $14.32 billion to $15.18 billion, or approximately 6%.
- Gross margin expanded sharply
- Gross margin was approximately 33.4%, calculated from the reported 66.6% cost-of-sales ratio, versus 30.7% in the prior-year quarter. The supplied quarterly history indicates gross margin increased 2.1 percentage points from 31.3% in the prior quarter.
- Profitability improved
- Calculated operating margin was approximately 13.1% from $15,180 million of sales less $10,108 million of cost of sales and $3,085 million of SG&A. Pre-tax margin was 13.3%, up from 11.4% year over year and 11.8% in the prior quarter in the supplied history.
- EPS grew 24%
- Diluted EPS increased to $1.36 from $1.10 year over year, a $0.26 or 24% increase, and rose from $1.19 in the prior quarter in the supplied history. Net income increased to $1,520 million from $1,243 million.
- Cash generation strengthened
- Six-month operating cash flow increased to $3,345 million from $2,185 million. After $1,159 million of property additions, calculated free cash flow was $2,186 million, versus approximately $1,227 million in the prior-year six-month period.
- Growth broadens beyond Marmaxx
- HomeGoods and TJX International were the fastest-growing businesses, with revenue increases of 10% and 11%, respectively, and HomeGoods segment margin expanded 7.6 percentage points to 17.6%. TJX increased its long-term global store target to 7,500 stores, while current store count and selling square footage each grew approximately 3% year over year.
And the other side of it.
The offsets in the same document — the things a summary that only listed the good news would have left out.
- Tariff benefit is nonrecurring
- The quarter included $331 million of IEEPA tariff refunds and a $219 million net benefit after $112 million of incremental compensation accruals. Management has not recorded a receivable for additional potential refunds, and any further refunds may not equal the approximately $490 million of IEEPA tariffs paid.
- Labor and compensation pressure
- SG&A rose to 20.3% of sales from 19.5% year over year, driven by tariff-related compensation accruals and incremental store wage and payroll costs. TJX also recorded $112 million of additional incentive compensation and discretionary bonus accruals related to the refunds.
- Inventory and tariff uncertainty
- Merchandise inventories increased to $7,862 million from $7,372 million year over year, or approximately 7%, while average per-store inventories increased 2%. Management continues to cite uncertainty around tariffs, vendor and competitor pricing, consumer demand and merchandise sourcing.
- Canada margin contracted
- TJX Canada’s second-quarter segment margin declined to 15.6% from 16.0%, despite 6% revenue growth, due to compensation accruals, payroll costs and higher freight costs. The segment also faced a 2% negative foreign-currency impact on reported sales.
- Near-term debt maturity
- Cash and cash equivalents declined to $6,004 million from $6,230 million at fiscal year-end, while $1,000 million of notes mature in the third quarter. Management intends to repay the debt from operating cash flows, creating a near-term liquidity use alongside $1,159 million of six-month capital spending.
- No formal risk-factor changes
- The filing states there were no material changes to the risk factors in the January 31, 2026 Form 10-K and no material changes to market-risk exposures. Nonetheless, the report identifies competition, economic conditions, currency, fuel prices and tariffs as ongoing risks; no incremental risk-factor change was disclosed.
What they reported.
What the company itself reported, taken out of the document.
- Earnings per share
- $1.36
- Gross margin
- 33.4%
- Operating margin
- 13.1%
- Segment
- Marmaxx: Q2 revenue $9,109 million, up 3% year over year; segment profit $1,424 million, up 14%, and margin 15.6% versus 14.2%.
- Segment
- HomeGoods: Q2 revenue $2,507 million, up 10% year over year; segment profit $441 million, up 94%, and margin 17.6% versus 10.0%.
- Segment
- TJX Canada: Q2 revenue $1,470 million, up 6% year over year; segment profit $229 million, up 4%, while margin declined to 15.6% from 16.0%.
- Segment
- TJX International: Q2 revenue $2,094 million, up 11% year over year; segment profit $135 million, up 36%, and margin increased to 6.4% from 5.2%.
What they said about what is next.
The 10-Q provides no new numerical revenue or EPS guidance; prior outlook was disclosed in the August 19, 2026 earnings release. Management anticipates fiscal 2027 capital spending of approximately $2.2-$2.3 billion, plans to repurchase approximately $2.75-$3.0 billion of common stock, and intends to repay $1.0 billion of notes at maturity in the third quarter using operating cash flows.
The filing reads better than the one before it.
What came before.
- 10-Q · May 29, 2026
- TJX reported robust Q1 FY27 results with significant increases in both revenue and earnings. Revenue reached $14.3 billion, a 9% growth year-over-year, while diluted EPS surged to $1.19, up from $0.92 a year ago,…
- 10-K · March 31, 2026
- TJX emphasizes its off-price, opportunistic buying model and scale (5,214 stores) as the core strategic moat, targeting merchandise priced 20%–60% below full-price retailers and supported by ~21,000 global vendors and a…
- 10-Q · December 2, 2025
- TJX reported a beat in the quarter with net sales of $15,117 million (vs $14,063 million a year ago) and diluted EPS of $1.28 (vs $1.14 a year ago). Gross margin expanded to ~32.6% and operating margin to ~12.5%,…
- 10-Q · August 29, 2025
- TJX reported a strong second quarter for fiscal 2026, with revenue of $14.4 billion and EPS of $1.10, surpassing estimates on both counts. Revenue increased by 6.9% year-over-year while EPS rose 14.6%, highlighting…
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