01—Abstract
Summary
Summary of the 8-K filed May 21, 2026. Cited figures are marked; the original filing is the authoritative source.
Ross Stores reported a strong first quarter of fiscal 2026 (13 weeks ended May 2, 2026).
Sales rose 21% to $6.01 billiona, and comparable store sales grew 17% against flat sales a year earlier. Operating margin expanded to 13.4% from roughly 12.2% a year earlier and well above the company's 11.8% to 12.1% plan. Diluted EPS of $2.02 rose 37% and beat the $1.60 to $1.67 guidance range.
Management attributed the sales outperformance mainly to customer traffic, new assortments, customer acquisition and marketing, and an improved in-store experience, and noted that higher tax refund spending may have contributed. For the second quarter ending August 1, 2026, management guided to comparable store sales growth of 6% to 7% and diluted EPS of $1.85 to $1.93b, implying 19% to 24% growth from $1.56. Fiscal 2026 guidance was raised: comparable store sales growth is now expected at 6% to 7% (on top of a 5% gain in 2025), and EPS is projected at $7.50 to $7.74, up 13% to 17% from $6.61 in fiscal 2025.
Prior fiscal 2026 EPS guidance is not included in this filing, so the size of the raise cannot be measured directly from it. Cash generation and capital returns were also solid. Operating cash flow was $836 millionc versus $410 million a year earlier, and capital expenditures were about $209 million, leaving roughly $627 million of free cash flow.
The company repurchased $319 milliond of stock (1.5 million shares) under a $2.55 billion two-year authorization and remains on track for $1.275 billion of buybacks in fiscal 2026. It also repaid $500 million of long-term debt, reducing total debt to about $1.02 billion from $1.52 billion, and ended the quarter with $4.13 billion in cash.
Store count grew to 2,282 from 2,205. Because this is a Form 8-K furnishing Exhibit 99.1, the information is not deemed filed under the Exchange Act.
02—Key points
Key Highlights
- Sales grew 21% to $6.01 billion, with comparable store sales up 17% versus flat results a year ago.
- Operating margin reached 13.4%, above the 11.8% to 12.1% plan, driven mainly by sales outperformance.
- Diluted EPS of $2.02 rose 37% and exceeded the $1.60 to $1.67 guidance range; net earnings were $650 million versus $479 million.
- Q2 guidance calls for comparable sales growth of 6% to 7% and EPS of $1.85 to $1.93 (19% to 24% growth).
- Full-year fiscal 2026 EPS guidance was raised to $7.50 to $7.74 (13% to 17% growth), with comparable sales growth of 6% to 7%.
- Operating cash flow nearly doubled to $836 million, and total debt fell by about $500 million to roughly $1.02 billion.
- Management plans $1.275 billion of share repurchases in fiscal 2026, with $319 million completed in Q1; store count reached 2,282.
03—Questions
Frequently Asked Questions
What drove the strong first-quarter sales growth?
Management attributed the 17% comparable sales increase primarily to customer traffic. Drivers cited include compelling merchandise assortments, a successful Spring assortment transition, higher customer acquisition and engagement from marketing initiatives, and an improved in-store experience. Management also said higher consumer spending related to tax refunds may have contributed.
Is the raised full-year outlook a sign of sustained momentum?
Management said it exited Q1 with solid momentum and raised fiscal 2026 comparable sales guidance to 6% to 7%. However, the Q1 comparable sales gain of 17% was far above the full-year range, implying a much slower pace for the remaining quarters. The guidance also does not explicitly separate the tax refund benefit, so investors may want to assess how much of the strength is sustainable.
How strong is the company's cash flow and balance sheet?
Operating cash flow was $836 million, and capital expenditures were about $209 million, producing roughly $627 million of free cash flow. Cash and equivalents were $4.13 billion at quarter end. Total debt fell to about $1.02 billion after a $500 million repayment, and stockholders' equity rose to $6.31 billion.
How much is the company returning to shareholders?
In Q1, Ross repurchased 1.5 million shares for $319 million and paid $144 million in dividends. The company expects to buy back $1.275 billion of stock in fiscal 2026 under a two-year $2.55 billion authorization approved in March 2026.
Does this filing include an audited or formal financial statement release?
No. This 8-K furnishes unaudited condensed financial statements and a press release under Item 2.02 as Exhibit 99.1. The information is furnished rather than filed, so it is not subject to Section 18 liability or incorporated into other filings unless specifically referenced. The full Form 10-Q for the quarter would provide more detail.
04—Continue