Burlington in 14th straight quarter of double-digit EPS growth; to open 115 stores
Burlington Stores reported strong, better-than-expected first quarter sales and earnings, and lifted its outlook for the year as consumers continue to seek out value in an uncertain economy.
The off-price retailer continued to grow its footprint during the quarter, with a net increase of 30 stores. For the full year, it now anticipates 115 net new stores for 2026, ahead of its prior guidance for 110.
Aside from its new store program, the company is continuing to "transform” its legacy store base through relocations and downsizes.
“Store relocations continue to perform well, typically delivering a sales lift of 5%-10% as we upgrade the physical store and move into higher traffic centers with stronger co-tenancy,” CEO Michael O’Sullivan said on the earnings call. “Our downsize program is also driving very strong results.”
Burlington’s downsize program is targeted at older, oversized stores in good locations. The company downsized 20 stores in 2025, and on track to downsize about 30 stores this year.
“In a typical downsize project, we cut the square footage in half, giving the excess space back to the landlord or subleasing to a co-tenant,” O’Sullivan told analysts. “On average, we are seeing a reduction in occupancy costs of about 200 basis points. The financial returns are very attractive, and we plan to ramp this program in the years ahead.”
Burlington ended the quarter with a total of 1,242 locations. Looking ahead, O'Sullivan said Burlington is on track to exceed 1,500 stores by the end of 2028. Of these, over 80% will have been opened or relocated or downsized since 2019.
"Our legacy of old, oversized, and low-productivity stores is diminishing," he said.
First Quarter
Burlington's first-quarter net income was $115 million, or $1.79 per share, for the quarter ended May 2, compared to $101 million, or $1.58 per share for the year-ago period. Adjusted earnings were $2.10 per share compared to $1.67 per share in the prior quarter, excluding $5 million and $4 million, respectively, of expenses in each period, net of tax, associated with bankruptcy acquired leases.
Total sales increased 14% to $2.852 billion. Comparable store sales increased 6%. Adjusted EBIT margin increased 20 basis points.
This operating margin expansion was driven by ahead of plan sales, higher gross margin, and leverage on supply chain expenses," O'Sullivan said in the earnings statement.
The retailer raised its full-year guidance. It now expects revenue o grow 9% to 11%, with the same-store sales to be in the range of 2% to 4%. Adjusted earnings per share are projected in the range of $11.45 to $11.80, representing between 13% and 16% growth over last year's $10.17 result.
"We are raising our full year fiscal 2026 sales and earnings guidance, passing through the entire upside from the first quarter to the full year," O'Sullivan stated. "These numbers underscore our ability to convert incremental comp sales into very strong earnings growth."