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F500-2023-087-TJX

The off-price department store chain brought in nearly $3.5 billion in profits in 2022, a 7% increase over 2021. TJX dropped 12 spots on the Fortune 500 list after a 22-spot jump last year. 
<ul> 
 	<li>Marmaxx, TJX’s apparel unit, was its biggest revenue driver, bringing in $30 billion of the $49.9 billion the company generated overall. Its HomeGoods division, however, saw slower sales after two years of expansion during the pandemic.</li> 
 	<li>TJX continues to lag in the e-commerce space, which held the company back at COVID’s height.</li> 
 	<li>Still, TJX has outlasted many of its competitors; Bed Bath &amp; Beyond’s bankruptcy may lead to more foot traffic at TJX stores.</li> 
</ul>

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F500-2022-075-TJX

TJX is the parent company of off-price retailers like T.J.Maxx, Marshalls, HomeGoods, Sierra, and Homesense, operating almost 4,700 stores in nine countries. The pandemic initially had a severe impact on revenue for TJX, which gets only a small percentage of its sales from e-commerce. But as lockdowns ended, the company rebounded, and in 2021, it grew revenue by 51% year over year, enabling it to jump 22 spots on this year’s list. In March 2022, TJX announced it would sell its 25% stake in Russian apparel retailer Familia in response to Russia’s invasion of Ukraine. In April 2022, the company announced that it is aiming to achieve net-zero greenhouse gas emissions in its operations by 2040.

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<span data-sheets-value="{&quot;1&quot;:2,&quot;2&quot;:&quot;TJX took a particularly brutal beating from the pandemic last year, hit by the double whammy of having almost no e-commerce to fall back on when its stores were closed for long periods, and the precipitous drop in spending on fashion. Sales fell 23% to $32.1 billion—but the damage could have been worse. For one thing TJX’s HomeGoods business slipped only 4%. And when its other banners, T.J. Maxx and Marshalls, reopened, business rebounded quickly. There are signs of pent-up demand for fashion apparel that should give TJX a boost this year (barring any new outbreaks that close stores en masse again), and spending on the home continues apace.&quot;}" data-sheets-userformat="{&quot;2&quot;:14723,&quot;3&quot;:{&quot;1&quot;:0},&quot;4&quot;:{&quot;1&quot;:2,&quot;2&quot;:16777215},&quot;10&quot;:2,&quot;11&quot;:4,&quot;14&quot;:{&quot;1&quot;:2,&quot;2&quot;:0},&quot;15&quot;:&quot;Arial&quot;,&quot;16&quot;:11}">TJX took a particularly brutal beating from the pandemic last year, hit by the double whammy of having almost no e-commerce to fall back on when its stores were closed for long periods, and the precipitous drop in spending on fashion. Sales fell 23% to $32.1 billion—but the damage could have been worse. For one thing TJX’s HomeGoods business slipped only 4%. And when its other banners, T.J. Maxx and Marshalls, reopened, business rebounded quickly. There are signs of pent-up demand for fashion apparel that should give TJX a boost this year (barring any new outbreaks that close stores en masse again), and spending on the home continues apace.

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F500-2021-97-TJX

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G500-2020-292-TJX

The off-price discount fashion and home goods retailer continued its long march toward retail dominance, with sales up 7% in 2019, to $41.7 billion, making it bigger than Macy’s and J.C. Penney combined. In the early days of the pandemic, TJX revenues fell off nearly entirely, with all stores closed and only a tiny e-commerce business in operation. But coming out of the lockdowns, TJX's strong financials should make its stores even more desirable to fashion brands as department stores continue to wither, analysts say. What’s more, TJX’s home furnishings chain HomeGoods has been booming alongside the more apparel-oriented T.J. Maxx and Marshalls.

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F500-2020-080-TJX

The off-price discount fashion and home goods retailer continued its long march toward retail dominance, with sales up 7% in 2019, to $41.7 billion, making it bigger than Macy’s and J.C. Penney combined. In the early days of the pandemic, TJX revenues fell off nearly entirely, with all stores closed and only a tiny e-commerce business in operation. But coming out of the lockdowns, TJX's strong financials will make its stores even more desirable to fashion brands as department stores continue to wither. What’s more, TJX’s home furnishings chain Home Goods has been booming alongside the more apparel-oriented T.J. Maxx and Marshalls.

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Global business is back. After limping through a worldwide financial crisis and economic slowdown, the 500 largest companies ranked by revenues shattered all sorts of performance records in 2013: They racked up combined revenues of $31.1 trillion, up 2.5% from 2012, and profits soared 27% to nearly $2 trillion. China’s 95 companies (up from 89 last year) posted $5.8 trillion in revenues. The U.S. has four fewer companies on the list than last year but remains (for now) the country leader, with 128 corporations on the list—including No. 1 Wal-Mart Stores—reporting $8.6 trillion in revenues. 

Wal-Mart stayed on top as its sales crept closer to half-a-trillion dollars. Apple moved into the top five. And UnitedHealth Group continued its steady climb. 

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Founded in 1962, TJX is an off-price retailer known for its portfolio of discount department stores, including T.J. Maxx, Marshalls, and HomeGoods, as well as various international brands like Winners and TK Maxx. It operates in the U.S., Canada, Europe, and Australia.

Q2 2027

Q1 2027

Q4 2026

Q3 2026

Q2 2026

Q1 2026

Q4 2025

Q3 2025

TJX (TJX): Company Profile, Stock Price, News, Rankings

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Ladies and gentlemen, thank you for standing by. Welcome to the TJX Companies First Quarter Fiscal twenty twenty six Financial Results Conference Call. At this time, all participants are in a listen only mode. Later, we will conduct a question and answer session. At that time, if you have a question, you will need to press 1.

As a reminder, this conference call is being recorded, 05/21/2025. I would like to turn the conference call over to Mr. Ernie Herman, Chief Executive Officer and President of The TJX Companies, Inc. Please go ahead, sir.

Thank you, Fran. Before we begin, Deb has some opening comments.

Thank you, Ernie, and good morning. Today's call is being recorded and includes forward looking statements about our results and plans. These statements are subject to risks and uncertainties that could cause the actual results to vary materially from these statements, including, among others, the factors identified in our filings with the SEC. Please review our press release for a cautionary statement regarding forward looking statements as well as the full Safe Harbor statements included in the Investors section of our website, tjx.com. We have also detailed the impact of foreign exchange on our consolidated results and our international divisions in today's press release and in the Investors section of tjx.com, along with reconciliations to non GAAP measures we discuss.

Thank you. And now I'll turn it back over to Ernie.

Good morning. Joining me and Deb on the call is John. I want to start by thanking all of our global associates for their ongoing commitment to TJX and to our customers. Our talented associates work hard to bring our business to life and deliver great value to consumers every day. Now to our first quarter results.

I am very pleased with our performance in the quarter. Overall comp sales grew 3% at the high end of our plan. Every division, both in The U. S. And internationally drove increases in comp sales and customer transactions.

Pretax profit margin and earnings per share both exceeded our expectations. John will talk about our first quarter results in more detail in a moment. During the quarter, our teams delivered an exciting mix of good, better and best brands across a broad range of categories and items to serve our very wide customer demographic. As always, we offered great value to our shoppers every day at each of our retail banners. Looking ahead, we are convinced that our value proposition and the flexibility of our business will continue to be a winning retail formula.

The second quarter is off to a strong start and we are excited about the initiatives we have planned, which we believe will further drive sales and traffic. The availability of merchandise we are seeing is outstanding and we are in a great position to take advantage of the plentiful opportunities that the marketplace is offering. We are confident in our ability to navigate the current tariff and macro environment in the short term. Importantly, our vision for long term growth, profitability and market share opportunities remains the same. Now, I'll turn the call over to John to cover our first quarter results in more detail.

Thanks, Ernie. I also want to add my gratitude to all of our global associates for their hard work and dedication to TJX and our customers. Now, I'll show some additional details on our first quarter versus last year. As Ernie mentioned, our consolidated comp sales growth of 3% came in at the high end of our plan. Overall comp sales growth was almost entirely driven by an increase in customer transactions.

Comps in both our apparel and home categories increased with home outperforming apparel. Pretax margin of 10.3% was down 80 basis points and was above our plan. Gross margin was down 50 basis points, primarily due to unfavorable inventory hedges. SG and A increased 20 basis points due to a lapping of a benefit from a reserve release last year in incremental store wage and payroll costs. Net interest income negatively impacted pretax profit margin by 20 basis points versus last year due to a lower cash balance and lower interest rates.

Lastly, diluted earnings per share of $0.92 were also above our expectations. Now to our first quarter divisional performance. Across all of our divisions, customer transactions increased once again. We see this as an excellent indicator of the strength of our value proposition across our retail banners. At Marmaxx, comp sales increased 2% and segment profit margin was 13.7%, down 50 basis points.

As we expected, Marmaxx's sales accelerated in March and April as the weather improved. Comp sales in both apparel and home categories were up. Also, we were very pleased with the sales growth at our U. S. E commerce sites and Sierra stores, which report as part of this division.

We remain confident that Marmaxx, our largest division, can capitalize on the opportunities we see to continue gaining market share and further grow our store footprint across The U. S. Our HomeGoods division delivered comp sales growth of 4% with strength at both the HomeGoods and HomeSense banners. Segment profit margin was 10.2%, up 70 basis points versus last year. We believe our U.

S. Home banners offer consumers a highly differentiated mix of home fashions from around the world. We are convinced that we can continue to grow our share of The U. S. Home fashions market.

At TJX Canada, comp sales were up 5%. Segment profit margin on a constant currency basis was 10.6%, down 170 basis points last year, primarily due to unfavorable transactional foreign exchange as we expected. TJX Canada is the leading off price retailer of apparel and owned fashions in Canada. With well recognized retail banners, we see our Canadian business as well positioned for continued successful growth. At TJX International, comp sales increased 5%.

We were very pleased to see continued strength in Europe and outstanding sales in Australia. Segment profit margin on a constant currency basis was 4.2%, up 20 basis points versus last year. We continue to see plenty of opportunities to grow our TK Maxx banner across our existing European countries and in Australia and to bring TK Maxx to Spain next year. I also want to reiterate our excitement for our joint venture with Grupo Axo in Mexico and our investment in Brands four Less in The Middle East. While still early, we're building great relationships with these teams and we see this as a way to participate in the growth of Off Price in these geographies.

Moving to inventory. Balance sheet inventory was up 15% and inventory on a per store basis was up 7% versus last year. We feel great about our inventory levels and have been taking advantage of the excellent deals we have been seeing in the marketplace. Availability of merchandise remains outstanding and we are set up very well to continue to flow fresh assortments to our stores and online. As to our capital allocation, we continue to reinvest in the growth of our business while returning significant cash to shareholders through our buyback and dividend programs.

Thanks, John. I'd like to start with a few comments on the current environment and the reasons for our continued confidence in our business. We have a very long track record of successfully navigating through many types of challenging economic and retail markets. Each time, we've emerged as an even stronger company with greater market share opportunities.

We have a very experienced leadership team that has worked together for multiple decades. While we're not immune to tariff pressure, we are laser focused on our initiatives to offset them by remaining flexible and executing our opportunistic buying approach. Long term, we remain as confident as ever in our strategic vision for future growth. Now, I want to reiterate the key characteristics of our business that give us confidence that we can continue to execute on our growth initiatives through the current environment and for many years to come. First is the value proposition we offer to our customers.

For us, value is a combination of brand, fashion, quality and price. Our customer surveys tell us that we have an excellent reputation as a value leader in each of our geographies. As a trusted value retailer, we have historically attracted new shoppers to our stores in many different types of environments. Therefore, we are convinced that we will have an opportunity to gain market share if more consumers seek out value in the current environment. We are confident that our commitment to our shoppers' great value on every item, every day will continue to resonate with consumers and drive more shoppers to our stores.

Next, our team of over 1,300 buyers source goods from an ever changing universe of over 21,000 vendors from more than 100 countries around the world. We have a global buying infrastructure and supply chain that has been in place for multiple decades. Further, we have longstanding relationships with many of our vendors and we can offer another avenue for them to grow their business. All of this gives us great confidence that we'll have plenty of merchandise available to support our long term growth plans. Third, we successfully operate stores across a very wide customer demographic.

We offer shoppers a wide breadth of good, better and best brands to appeal to shoppers across a broad range of income and age groups. We believe this is a tremendous advantage and will continue to allow us to attract a wider shopping audience than many other retailers. Next, all aspects of our business model are driven by flexibility. Our global buying, store operations, supply chain and systems are designed to support our flexible business model. This allows us to offer an exciting treasure hunt shopping experience with rapidly changing selections across all categories.

We are confident that our flexibility will continue to help us to navigate through many types of environments and allow us to react to changing consumer preferences. Lastly, but most important is our talent. I truly believe that the depth of off price knowledge and expertise and longevity of our management teams within TJX is unmatched. We take great pride in being a teaching organization, which is a high priority of our managers throughout the company. This is supported with our TJX University and other training programs.

our human resource teams are extremely focused on developing talent and succession planning to ensure we develop the next generation of leaders of TJX. Additionally, I am so proud of our culture, which I believe is a major differentiator. I am convinced that our constant focus on talent and culture have been significant keys to our success and will continue to be going forward. Again, we are confident that the combination of these characteristics is why we have delivered decades of sales and profit growth and gives us great confidence that we are set up very well for long term success. Summing up, we are very pleased with the overall performance of TJX in the first quarter.

I truly believe we have one of the best models in retail and that it will serve us well in today's environment. Longer term, we continue to see a long runway for growth. As an up price leader in every country that we operate in, we see plenty of opportunities to further grow our market share in The U. S. And internationally.

Lastly, I have great confidence that the flexibility of our business, our relentless focus on value and very importantly, our talented associates will continue to be major contributors to our success for many years to come. Now, I'll turn the call back to John to cover our full year and second quarter guidance, and then we'll open

Thanks again, Ernie. I'll begin with some color on how we're thinking about tariffs. Let me start by saying that we believe we can navigate through the current tariff environment. While we're not immune to tariffs, we feel great about the components of our business that we can control and remain confident in our long term growth and profitability plans.

We're also realistic that in the short term, we are operating in a highly fluid macro environment. For simplicity purposes, we're making the assumption that the current level of tariffs on imports into The US from China and other countries will stay in place for the remainder of the year. In terms of our guidance, as we noted in our press release this morning, we are maintaining our full year comp sales growth, pre tax profit margin and diluted earnings per share outlook. This guidance assumes that we can offset the significant incremental pressures we have seen and expect to see from tariffs on both our direct and indirect imports this year. We believe we can do this primarily through our buying process, our ability to adjust our ticket while maintaining our value gap, and our ability to diversify our sourcing.

Further, we are focused on cost efficiencies and productivity initiatives. Now to our detailed full year fiscal twenty twenty six guidance, which remains unchanged versus the previous full year guidance we gave in February. We expect overall comp sales to increase 2% to 3%. We're planning full year consolidated sales to be in the range of 58,100,000,000.0 to $58,600,000,000 up 3% to 4%. With the volatility we've been seeing with foreign exchange rates, we are holding rates at the same level as our previous guidance.

We are planning full year pre tax profit margin to be in the range of 11.3% to 11.4%, down 10 to 20 basis points versus last year's 11.5%. Moving to gross margin, we expect it to be in the range of 30.4% to 30.5%, a 10 to 20 basis point decrease versus last year's 30.6%. We expect full year SG and A to be 19.3% versus last year's 19.4%. We're assuming net interest income of about $98,000,000 which we expect to deliver fiscal twenty six pre tax profit margin by 20 basis points. Our full year guidance assumes a tax rate of 25.1% and weighted average share count of approximately 1,130,000,000.00 shares.

Lastly, we expect full year diluted earnings per share to be in the range of $4.34 to $4.43 This would represent a 2% to 4% increase versus last year's diluted earnings per share of $4.26 Moving to the second quarter, we expect overall comp sales to increase 2% to 3%, consolidated sales to be in the range of $13,900,000,000 to $14,000,000,000 pre tax profit margin to be in the range of 10.4% to 10.5%, down 40 to 50 basis points versus last year's 10.9% Gross margin to be 30%, this would be a decrease of 40 basis points versus our last year. This includes incremental tariff costs on the directly sourced merchandise that we were committed to when the additional tariffs went into place in March and April, mostly offset by our mitigation efforts. We are also lapping a benefit from a true up of a freight accrual last year. SG and A to be 19.7%, down 10 basis points versus last year. This is due to a benefit from lower incentive compensation accruals planned this year.

We're also assuming net interest income of about $24,000,000 which we expect to deliver second quarter pre tax profit margin by 20 basis points. Our second quarter guidance also assumes a tax rate of 24% and a weighted average share count of approximately 1,130,000,000.00 shares. Based on these assumptions, we expect second quarter diluted earnings per share to be in the range of $0.97 to $1 up 1% to 4% versus last year's 96%. In closing, I want to emphasize that we are in an excellent position to continue to invest in the growth of our company while simultaneously returning significant cash to our shareholders. Now we are happy to take your questions.

As a reminder, please limit your questions to one per person, person so we can answer as many questions as we can. Thanks, and now we'll open it up to questions.

Thank you very much. If you would like to ask a question, please press 1. Please unmute your phone and record your name clearly when prompted. Your name is needed to introduce your question. To withdraw that request, you may press 2.

1 moment for our first question, please. And our first is from Lorraine Hutchinson with Bank of America. Ma'am, line is open.

I wanted to ask about inventory availability. I think for two decades I've been asking about inventory availability and you use great adjectives like outstanding. And that's always been the case. But we're in a little bit of a different environment right now. We're hearing about delayed ship sailings, uncertainty around tariff rates for holiday.

There's a lot of question marks in the buying offices of the traditional retailers and brands. So can you just give us a little bit more context on what's changed, how your conversations have gone and what kind of pricing you think you may have to put in place in the back half to offset some of these tariffs?

Yes. Very good question Lorraine. Yes, remember many times you've asked about availability. This time, to your point, the environment is so different, totally appropriate question. Shipments, yes, I think we've heard from vendors, especially pre the adjustment in the tariffs, shipments were being delayed.

But things changed a little when the tariffs were moderated a bit. I believe you have and I'm kind of talking globally here in the vendor community, you definitely have an uneasiness, I would say uneasiness on what's going to be happening now and forward because it isn't still crystal clear. The way we approach it though, I think you'll appreciate this, you look at our inventories, they're up a bit. That's reflecting some of the great buys that our teams have really been able to take advantage of in the market recently. We only see that trend going up in terms of availability as we go to the back half.

To your point, when some of the vendors are talking about cutting back or delaying, Could we see a category here or there where there's less availability than we traditionally see from the traditional retailers potentially cutting back in advance or the wholesaler cutting back? That could happen. The good thing with our flexibility is we will just take advantage of an adjacent category or something and we'll say, hey, we'll give up on the one category that might have a little less and we'll just have a little less of it. We won't I shouldn't say give up, we'd have a little less inventory on that and we'll go after the ones where we think there's more exciting value to put out there. Our only I always emphasize this, our only contract to the customer is that we will have great value on the goods that we put out there and it will be below the out the door price of traditional retailers, especially retailers, etcetera.

So that is always you never have to worry about that. In our pricing, yes. Do we think we are going to take advantage of the, I guess the word would be chaos that's out there. And Lorraine, I know you've heard us talk about that in the past. In this type of environment, albeit the tariff situation might make things obviously a little more complicated around the board.

And as you saw in some of the numbers, we take a little bit of a hit in Q2. Over the back half, we believe there's going to be tremendous opportunity for our merchants to take advantage of it. And then as far as pricing goes, it's kind of funny your question here is a few parts. As far as the pricing goes, we will always ensure that we are below, that we have a gap between us and the out the door price at the regular traditional retailers. Having said that, we believe there's opportunity for us to buy better.

And if retails do move out there, we will adjust our retails to preserve that gap. That could mean they go up on certain items. If somebody actually adjust, this is always the case also, if they adjusted a retail down, we would do that as well. But that's kind of, I think I touched on all the great question because it really encompasses a lot of what I think people are thinking right now, Lorraine, in terms of how we're going to approach the buying end of this business.

Our next question is from Matthew Boss with JPMorgan. And your line is open now.

Thanks and congrats on the continued consistency.

So Ernie, maybe first, could you speak to the progression of comp trends that you saw at Marmaxx in March and April, maybe relative to the start of the quarter some of the weather disruption? And maybe if you could elaborate on that strong start to the second quarter? And then one for John, just gross margin considerations maybe for the balance of the year relative to the contraction in the first quarter.

Sure. Yes, very good, Matt. Actually, John will start off here.

Yes. So as far as the sales go, we did see weather early in the first quarter. And once the weather improved, we did see a comp our comps improve month to month as the quarter went on. And we saw that continue into the second quarter and that's why we've highlighted a strong start in our prepared remarks.

Yes. And Matt, great question. First of all, I'm very encouraged by the strong start in Q2 as well. And one of the most encouraging things going back to Q1, and again happy with this in Q2 is that every division is participating in our comps. And as John said, in Marmaxx, which got better as the quarter went on, I think we've been very happy when we saw the more recent Marmaxx comps coming out of Q1.

And I think we have not our business obviously for years has been extremely strong. It's just nice to see right now where we have every division participating in that strength, every geography we're in, and specifically internationally as well. And obviously bucking a trend in the home industry right now is our home business, highlighted by HomeGoods, very proud of those teams and what we're doing there versus the industry. And proud of the way they're beginning Q2 as well.

Yes. And then Matt, answer your second question, so for Q2, Q2 is really our most impacted quarter for tariff pressures as the tariffs were put in place after we had placed the orders for goods that we directly import. So we have significant mitigation efforts in place for Q2 and we expect those mitigation efforts to continue into the back half. But in addition to that, we've also experienced a negative impact on the mark to market of our inventory hedges in Q1 and some of that will reverse in the back half favorably. In addition to that, the front half is negatively impacted versus last year from favorable freight accrual reversals last year.

So all that adds up to why you're seeing a headwind in the first half and an improvement in the back half.

Our next question is from Adrienne Yea with Barclays. Your line is now open.

Good morning and congrats on the success and continued success. Ernie, I wanted to go back to kind of the era of twenty eighteen-twenty nineteen. Do you recall if vendors did try to pass price through to you and then you negotiated back against them? And then I see two different ways that as you described earlier that you can react here. One, you can obviously, if prices go up, you can maintain that 20% to 60% off.

You can maintain your margin and then hope to get some comp. Or I think in another call, said you also have the flexibility if you chose to do so, take some of the margin hit, hold your pricing 30 to 70 and then go for comp. So it seems like you have so many different routes back to success.

Absolutely, Adrienne. You touched on some of the levers that we had. In 2018, first of all, yes, we had a case where in that situation, we were able to, in most cases negotiated out of it. So the tariff just didn't mean as much in total. I would tell you though back then, yes, we would but I would say more rarely than today, we would grab a little bit of a retail and adjust where possible.

This time period we're in now, I think, a little different, so more widespread in the pure numbers, as well as since 2019, you know better than me, inflation overall had hit starting back a few years ago, which only adds into retails over the last few years and then now you have tariffs on top of that. So a little different back when those other tariffs happened, you didn't have nearly as much inflation prior to that time period. So, back to answering your question, yes, retails can be part of the adjustment. But as we did talk about and you just referred to it, we have other levers, which is the ability to buy in this environment with all the availability that's out there by really I would say more profitably and advantageous. The other thing that's happened is we're continuing to be more important to the vendors.

And I think that is creating an ability for us to work with the vendors to ensure that we are getting to a price, tariffs or no tariffs, to get to the price in the retail that is still the significant value, because they see us as probably one of the more consistent retail outlets. Our bars are very straightforward with them. And we're very transparent with our vendors. And so I think an advantage that's taking place and this could continue to improve as other stores perhaps close. We've had a number close prior obviously in the last couple of years.

I only see those relationships becoming stronger. And those are not about adjusting retails. Those can be about, as you said, driving comps and having retails that create a wow in our mix, because sometimes we want a customer to actually say that almost feels too cheap, all right? So that's the art form that we try to bring to the table, whereas a lot of the other retailers I think would never even go down that route. We want, I don't know, one out of every 10 hangers, I want a customer saying, boy, that almost feels too inexpensive strangely enough.

And that's what creates the wow factor in our business and that's the art form. So I hope I answered. But that's I think what you were referring to where I've talked before about we'll put it, sometimes we won't, we'll just retail the goods at an extremely sharp price. A last thing that hits me is, remember our buyers are trained to not, they do not use a markup wheel. So meaning on one item they can pay X.

It doesn't mean on that item they're going to retail it at Y. The next time that's paying X gets retailed at the same Y. That doesn't happen. They're merchants where we go by what is the right value for the out the door of that item, regardless of the cost. And that's what I think is a different thing, where our buyers work retail backwards and the why retail backwards.

And don't start with the cost and focus on the cost as much as the other merchants do at other retailers. Probably a little more unfurled than you needed, but it's a good topic. So thanks for asking it.

just a real quick one. From China, are you seeing any redirected China make into the European market yet?

Sorry, are we seeing what? Any redirection of merchandise into the European market?

Yes, so China that they don't want coming here from other retailers or vendors that are coming to you in Europe, right?

So nothing significant that we've seen. I think that the factories were kind of holding off and waiting for a tariff deal to be done or at least lower before shipping the goods. But no, haven't seen a lot hitting Europe that were destined for The United States.

Our next question now is from Paul Lejuez with Citi. And your line is open.

Hey, thanks guys. Ernie, what percent of your product currently is direct source by you? And how might that change, if at all, in response to the current environment? And also curious if you maybe do less upfront in anticipation of maybe better deals that you expect to come in the second half? And then just would also love to hear about anything you can share in terms of income demographics, any signs that you're gaining share more so with any one specific income cohort?

John jump in on the income there. But as far as direct source, it's really less than 10% of our business. And I would tell you that we don't purposely, we keep that in a balance. We're all about having eclectic, well balanced mixes and assortments. And so we don't swing the pendulum on those places.

So that is not something you'd see us play with a lot, because obviously we can move sourcing countries on our direct imports around and we could have China, for example, be less of a percentage. But we tend to hover around that number of the 10%, Because again, we're very brand driven, so we don't want to have that go out of context. Having said that, on those direct imports, fill voids and give us great quality and fashion And we do it differently than others. So on the upfront buying, Paul, that you're asking about, yeah, we are viewing this, you're really spot on, as a time to I would say, buy more hand to mouth, closer in the market and call back our upfront buying to a degree. Again, we're very strategic.

That varies by category. And that varies by department literally and by buyer item and SKU. But that would be the lean right now. So you are on the right trend, because we do forecast. Again, it's never not happened.

By the way, and I've heard in the past, going back thirty years, is there's always a reason why people think, well this time is different. I don't believe this time is different to any large degree that we will come out stronger and we will really take advantage of the situation as we move throughout the year here opportunistically, both from a drive sales and a profitability standpoint. John, you want to talk about

income Yes. Income demos, so again, we are not measuring the actual customer income. We're looking at our store performance in certain income demographic areas in lining that up. So what we saw during the first quarter is that across all our income demographic bands that we saw strong sales in all of those bands, leaning slightly towards the lower income demographic. And again, that kind of speaks to when you look at our overall sales drive driven mainly by transactions is that as there's customers are concerned about the economy, many of them are going to look for value and TJX is one the companies that we're one of the leaders in offering value to those customers.

Yeah, that's it. I'll also jump in and piggyback on John here a little on this, Paul, is one of the, and I mentioned it in the script, again, of our key, key advantages is the fact that we purposely try to appeal to all these demos just like John said. So we are, you know, the whole good, better, best aspect of our business, which we believe is an advantage. We are conscious not only in our mixes that we put in the stores, but in the way we model the stores to continue to do balanced business with each income demographic, just like John said. And we think that is one reason we deliver consistent results, whereas we don't tend to have these up and downs as some other retailers do, I think because we're more diversified from the income demographic standpoint.

And so even if even to get off in a little bit here of a tangent, even in our marketing if you look, we think I think in this environment indirectly it's coming up in your questions, how do we take advantage of this environment? Our marketing teams have really looked at the different programs that we have. So if you look, we have the campaign in Max, which is called What Makes You You. In Marshalls, we have the hustlers campaign, which actually shows you how the buyers work so hard at bringing the best value to the customers. And I think that shows you right now our mindset.

And with that marketing, we're hoping to get some of customers out there that have not engaged with us to get them to shop us, because this is a perfect opportunity when some of our competitors have been, I don't mean off price by the way, I mean just total retail competitors, are offering customers the desire to probably try other avenues. So I think our marketing teams are doing a great job with the campaigns of giving them a reason to why should I try shopping at Marshalls or a TJ Maxx. So and again, across all income, even our marketing is aimed at all different income demos and the way our creative is placed and as well as the spots that they're placed in digital or TV or radio, etcetera.

Thanks a lot guys. Appreciate it. Good luck.

Our next question now is from Alex Stratton with Morgan Stanley. And your line is open.

Perfect. Congrats on a great quarter. I wanted to focus on HomeGoods, which had nice comp and margin expansion. Can you just talk about how you think about the margin trajectory of that business for the rest of the year? I'm curious in the context of the low teens margin, it's done in the past, if you think that's in reach.

And then related to that, we know that Home and Toys tend to be more sourced out of China, super important for holiday. So with the incremental tariff there, can you just talk about how you're managing those categories both near term and then with respect to the holidays? Thanks so much.

Sure, Alex. Yes, as I mentioned before, we're very happy with the HomeGoods comps because relative just as you're feeling relative to the environment out there, are certainly outpacing and I can't be more proud of those teams and really all the home merchants across the corporation. Home has performed strong for us overall. What we're looking at on margins, yes, I won't give you the number, but we are feeling very positive about continued improvement, right, John?

TJX Q1 2026 Earnings Call Transcript | Fortune

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TJX (TJX) Q1 2026 Earnings Call Transcript

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