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,…
Earnings analysis · 10-Q
TJX earnings analysis
Filed August 28, 2026 · Our reading of the company's report
The latest report
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,…
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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.
Gross and operating margin
How much of each revenue dollar the business keeps.
One point per quarterly or annual filing. Both margins are shares of that report's revenue.
From revenue to operating profit
Where each $100 of revenue went in this report.
Cost of sales, operating expenses, and what remained. Figures are rounded to whole dollars.
Where revenue came from
The business segments reported by the company.
Shares of the segments disclosed in this filing, largest first.
How we read each report
Our analysis across the last few reports.
Our model's reading of each filing, not the share price or the market's reaction. Annual and quarterly reports each occupy one position.
Reported figures
- Earnings per share
- $1.36
What stood out
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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%.
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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.
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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.
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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.
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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.
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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.
What to watch
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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.
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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.
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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.
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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.
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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.
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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.
Management's outlook
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.
Earlier filings 4
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…
This is our reading of a public filing, not the filing itself. Analysis can contain errors; check the source document for full context.