Ross Stores, Inc. Q2 2027 Earnings Recap

Ross Stores’ shares rose modestly by 1.9% following a quarter marked by a 10% comparable store sales increase and significant margin expansion, though the market reaction suggests the results met but did not meaningfully exceed expectations.

Key Takeaways

• Comparable store sales grew 10% in Q2, driven primarily by increased customer traffic and transaction frequency across demographics.
• Gross margin improved by 625 basis points, with tariff refunds contributing 405 basis points; excluding tariffs, operating margin rose 205 basis points.
• Total sales increased 13% to $6.3 billion, with net income up to $851 million from $508 million year-over-year; EPS more than doubled to $2.66.
• Inventory rose 18% with careful management of packaway inventory to support higher in-store availability and improved merchandise margins.
• Plans raised for net store openings to 115 locations in 2026, reflecting confidence in growth initiatives despite tougher year-over-year comps expected in second half.