Five Below sales soar 32.5%; opening 50 stores in Q2
Five Below reported an impressive first quarter that exceeded top-and bottom-line estimates as it continued its aggressive expansion.
The value retailer for tweens and teens opened 49 net new stores across 25 states during the quarter, for a total of 1,970 stores in 46 states. It expects to open approximately 50 new stores in the second quarter.
On the earnings call, CEO Winnie Park said the company is now testing layouts and designs within the store “to further strengthen the shopping experience while improving sales.”
Park also told analysts that Five Below has done away with its dedicated “Five Beyond” section, which featured items above the chain’s signature $5 price point.
“We moved that product in line, and we've actually seen that product perform better because it's basically merchandised the way the customer wants to shop the product,” she said, adding that the majority — 80% — of Five Below’s assortment is still $5 and below.
Net income totaled $123.1 million, or earnings per share of $2.21, for the quarter ended May 2, compared to $41.1 million, or earnings per share of $0.75, in the year-ago period. Adjusted diluted income per common share was $2.22 compared to $0.86 in the first quarter of fiscal 2025. Analysts had expected earnings per share of $1.70.
Net sales surged 32.5% to $1.28 billion amid strong new store performance. Comparable sales increased by 22.7%, driven by a 4% increase in ticket and a 19% rise in transactions.
Fifteen of Five Below’s 18 departments had positive come growth. Games and toys were particularly strong, driven by collectibles and the overall squishy trend, company executives said on the earnings call.
"We are thrilled with our outstanding first quarter performance, which is a testament to the team’s execution of our customer-centric strategy," Park said in the earnings statement. "The result was broad-based growth across our merchandising worlds, new and existing customers, and all demographic and geographic segments. Our continued focus on compelling newness at amazing value and great store execution are at the heart of our operating flywheel."
