Ross Stores Delivers Strong Q1 Performance, Exceeding Expectations
Ross Stores, the parent company of discount retailers Ross and dd's DISCOUNTS, has reported a stellar first quarter (Q1) performance for 2026. The company exceeded expectations with a 21% increase in total sales to $6.0 billion, driven by a robust 17% growth in comparable store sales.
The strong results were attributed to various factors, including an increase in tax refunds and healthy customer count growth across income levels, ethnicities, and age groups. The company's marketing efforts also played a significant role, with the team driving customer acquisition and engagement through creative messaging and changes to their media mix.
Chief Executive Officer James Conroy praised the entire organization for its exceptional performance, highlighting the teamwork demonstrated by various departments, including merchants and planners, supply chain network, and stores teams. He noted that the company's marketing team delivered strong customer acquisition and engagement, while merchants and planners provided compelling assortments and secured product to meet outside demand.
Inventory levels also showed a positive trend, with consolidated inventories at the end of Q1 increasing by 12%. The packaway percentage dropped to 36%, compared to 41% in the previous year, indicating a more balanced inventory composition. This is expected to provide a solid foundation for the second quarter.
Store growth was another area where Ross Stores performed well, with the opening of 13 new Ross and four dd's DISCOUNTS locations during Q1. The company continues to plan for 5% unit growth this year, comprising approximately 85 Ross and 25 dd's stores. This growth strategy is expected to further improve customer experience through better connectivity between merchandising, marketing, and stores.
Financial results were also impressive, with operating margin expanding 120 basis points to 13.4%, significantly exceeding expectations. The strong Q1 performance has left Ross Stores optimistic about continued sales growth going forward.
