PHILADELPHIA, PA — Five Below Inc. (NASDAQ: FIVE) raised its full-year sales and earnings outlook after reporting a sharp increase in first-quarter revenue and profit, signaling continued consumer demand for value-focused discretionary merchandise despite broader economic uncertainty.
The discount retailer posted first-quarter net sales of $1.29 billion for the period ended May 2, up 32.5% from a year earlier, while comparable sales increased 22.7%.
The results represent one of the company’s strongest quarterly performances in recent years and suggest Five Below continues to gain market share as consumers seek lower-priced products across a range of discretionary categories.
Net income nearly tripled to $123.1 million, compared with $41.1 million a year earlier.
Diluted earnings per share rose to $2.21 from $0.75, while adjusted diluted earnings per share increased to $2.22 from $0.86.
Operating income climbed to $154.2 million from $50.8 million in the prior-year quarter, reflecting both stronger sales volumes and improved profitability.
Chief Executive Officer Winnie Park attributed the performance to growth across merchandise categories, customer segments and geographic markets.
“The result was broad-based growth across our merchandising worlds, new and existing customers, and all demographic and geographic segments,” Park said.
The retailer added 49 net new stores during the quarter and ended the period with 1,970 locations across 46 states, an increase of 7.9% from a year earlier.
The strong start to the year prompted management to increase its fiscal 2026 outlook.
Five Below now expects annual sales between $5.40 billion and $5.48 billion, supported by plans to open approximately 150 net new stores and generate comparable sales growth of 6% to 8%.
The company projects full-year diluted earnings per share of $8.62 to $9.02, or $8.65 to $9.05 on an adjusted basis.
For the second quarter, Five Below expects revenue of $1.18 billion to $1.20 billion and comparable sales growth of 7% to 9%.
The outlook incorporates tariff rates currently in place through July 24 and assumes tariffs subsequently return to levels that existed at the beginning of the fiscal year. The forecast excludes any impact from potential tariff refunds or share repurchases.
Park noted that management remains focused on navigating economic uncertainty while maintaining the retailer’s value-oriented positioning.
The results suggest Five Below’s combination of aggressive store expansion, value pricing and trend-driven merchandise continues to resonate with consumers, even as many retailers face pressure from tariffs, inflation concerns and shifting consumer spending patterns.
The company expects gross capital expenditures of $230 million to $250 million during fiscal 2026 as it continues expanding its store footprint and supporting long-term growth initiatives.
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