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    OLLI
    Earnings call· Apr 2026(Q1 FY27)

    Ollie's Bargain Outlet Holdings Q1 FY27 earnings call OLLI

    Jun 3, 2026 Source

    Executive summary

    Ollie's Bargain Outlet Q1 FY27 — Strong Earnings Growth Amidst Challenging Consumer Backdrop

    Ollie's Bargain Outlet delivered strong Q1 FY27 earnings and margin expansion, driven by new store growth and effective cost management. Despite a challenging consumer environment marked by weather volatility and rising fuel costs impacting lower-income shoppers, the company leveraged its value proposition and robust closeout market. Management is proactively investing in price and strategic initiatives to drive sales and market share, while maintaining its full-year earnings outlook.

    Highlights

    5

    • Adjusted net income increased 21% to $56 million.

    • Adjusted earnings per share increased to $0.91.

    • Net sales increased 14% to $659 million, driven by new stores and comparable store sales growth.

    • Gross margin increased 80 basis points to 41.9%, exceeding expectations due to lower supply chain costs.

    • Ollie's Army loyalty program grew 13% to 17.5 million members.

    Concerns

    3

    • Comparable store sales increased only 1.7%, with Q2 trends running below the full-year target.

    • Unseasonable weather and surging fuel prices pressured key categories like Lawn and Garden and impacted traffic, particularly for lower-income consumers.

    • Higher pre-SCOTUS tariff assumptions are included in guidance for the back half of the year, alongside higher fuel costs.

    Guidance & targets

    15
    CategoryTargetConfidence
    Full-year 2027 new store openings
    75 stores
    medium materiality
    High
    Full-year 2027 net sales
    $2.98 billion to $3 billion
    high materiality
    High
    Full-year 2027 comparable store sales growth
    2%
    high materiality
    Medium
    Full-year 2027 gross margin
    40.7%
    high materiality
    High
    Full-year 2027 operating income
    $340 million to $348 million
    high materiality
    High
    Full-year 2027 adjusted net income
    $271 million to $277 million
    high materiality
    High
    Full-year 2027 adjusted earnings per share
    $4.45 to $4.55
    high materiality
    High
    Full-year 2027 depreciation and amortization expenses
    $63 million
    low materiality
    High
    Full-year 2027 preopening expenses
    $22 million
    low materiality
    High
    Full-year 2027 annual effective tax rate
    approximately 25%
    low materiality
    High
    Full-year 2027 diluted weighted average shares outstanding
    approximately 60.9 million
    low materiality
    High
    Full-year 2027 capital expenditures
    $103 million to $113 million
    medium materiality
    High
    Annual share buyback levels
    roughly 50% of free cash flow
    medium materiality
    High
    Full-year 2027 share buyback outlook
    $125 million
    high materiality
    High
    Q2 FY27 comparable store sales
    similar to the first quarter
    high materiality
    Medium

    Operational metrics

    19
    New stores opened
    27
    Q1 FY27

    Opened in the first quarter.

    Total stores
    672
    Q1 FY27

    Ended the period with 672 stores in 35 states.

    Adjusted net income
    $56 millionincreased 21%
    Q1 FY27

    Adjusted net income for the first quarter.

    Adjusted earnings per share
    $0.91
    Q1 FY27

    Adjusted earnings per share for the first quarter.

    Adjusted EBITDA
    $88 millionincreased 22%
    Q1 FY27

    Adjusted EBITDA for the first quarter.

    Adjusted EBITDA margin
    13.3%increased 80 bps
    Q1 FY27

    Adjusted EBITDA margin for the first quarter.

    Gross margin
    41.9%increased 80 bps
    Q1 FY27

    Gross margin for the first quarter, driven by lower supply chain costs.

    SG&A expenses
    flat
    Q1 FY27

    SG&A expenses were well managed and flat as a percentage of sales in the quarter.

    Preopening expenses
    $6.4 milliondecreased 3%
    Q1 FY27

    Decrease driven by lower rent expense, partially offset by higher number of new store openings.

    Cash and investments
    $526 millionincreased $111 million or 27%
    Q1 FY27

    Total cash and investments at the end of the quarter.

    Share buyback
    $53 million
    Q1 FY27

    Amount of common stock repurchased in the quarter.

    Inventory
    increased 12%YoY
    Q1 FY27

    Primarily driven by new store growth.

    Capital expenditures
    $25 million
    Q1 FY27

    In the quarter, majority for new stores, existing store improvements, and Texas DC expansion.

    Texas DC expansion completion
    early Q3
    Q3 FY27

    Expansion of Texas distribution center progressing as scheduled.

    Illinois DC expansion start
    later this year
    FY27

    Expansion of Illinois distribution center will begin later this year.

    Network capacity
    over 850 stores
    future

    The two expansions will increase network capacity.

    Seasonal decor performance
    top-performing category
    Q1 FY27

    Even with the headwind of an early Easter.

    Wall-to-wall carpet replacement sales productivity
    improved over 100%
    Q1 FY27

    Replacing wall-to-wall carpet with furniture improved sales productivity in the same floor space.

    Utilities expense deleverage
    15 bps
    Q1 FY27

    Elevated utilities expense, primarily from winter conditions.

    Industry KPIs

    3
    MetricValueDetails
    Regional market performanceEast, Midwest, Central outperformed plans by 100-200 bps; South lagged by 100-300 bpsbps
    Subscription membership program17.5 millionmembers
    Operating income EBIT and adjusted EBITDA$88 millionUSD

    Risks & headwinds

    5
    Challenging consumer backdropQ1 FY27, ongoing

    Surging fuel prices, unseasonable weather, impacting lower-income consumers and traffic.

    Mitigation: Strengthening value proposition, investing in price, optimizing category mix, enhancing loyalty program.

    Weather volatilityQ1 FY27, Q2 FY27

    Continued impact on sales, particularly outdoor seasonal products; Q2 trends running below full-quarter guide.

    Mitigation: Proactive price investments, aggressive marketing, expectation of pent-up demand as weather normalizes.

    Higher fuel costsFY27

    Assumed for the balance of the year, impacting gross margin.

    Mitigation: Offset by lower tariff expenses and overall supply chain productivity improvements.

    Tariff assumptionsH2 FY27

    Higher pre-SCOTUS tariff assumptions included in guidance for the back half of the year.

    Mitigation: No benefit of any tariff refunds considered in outlook; lower tariffs in H1 provided some offset.

    Consumer income-cohort divergenceQ1 FY27, ongoing

    Lower-income consumers trading out faster than higher-income trading in, netting out flat in Q1.

    Mitigation: Focus on value proposition, compelling deals, and loyalty program to attract and retain customers across income levels.

    Q&A highlights

    7

    Could you elaborate on the cadence of comps in Q1, particularly by region and category, and your confidence in delivering the full-year 2% comp target, especially for Q2 given the softer start?

    Q1 comps were positive across all three months, with February being the strongest. Performance varied by region due to weather, with East, Midwest, and Central outperforming plans, while the South underperformed due to heat impacting lawn and garden. Q2 trends are currently behind the full-quarter guide, but core categories remain strong, and management expects pent-up demand for seasonal products as weather normalizes, supported by planned events.

    “The East, Midwest and Central all experienced more normalized conditions and [ they'd be planned ] by 100 to 200 basis points. The South where it was hot and we saw drought-like conditions, that region lagged between 100 to 300 basis points.”

    asked by Matthew Boss · answered by Robert Helm

    2 min read6 chapters

    Detailed Narrative

    01

    Consumer Behavior and Regional Divergence

    The first quarter saw a rapid shift in consumer behavior, with surging gas prices and unseasonable weather impact🌐ing shopping patterns. Customers prioritized needs, leading to trip consolidation, particularly affecting lower-income consumers. Performance varied regionally, with East, Midwest, and Central markets outperforming plans by 100-200 basis points, while the South lagged by 100-300 basis points due to hot, drought-like conditions that specifically impacted the Lawn and Garden category.

    02

    Strategic Initiatives and Sales Productivity

    Ollie's is actively optimizing its category mix to drive sales productivity. An example is replacing wall-to-wall carpet with furniture, which improved sales productivity by over 100% in the same floor space. The company is also working on rightsizing assortments in other categories like Books and Flooring, leveraging data and a test-and-learn framework for more informed merchandising decisions. These initiatives are expected to become meaningful comp movers as they scale.

    03

    Robust Closeout Market and Deal Flow

    The closeout market remains strong, benefiting from a disruptive consumer environment and ongoing retail consolidation. Suppliers are motivated to move product due to inventory imbalances, leading to an increase in both the quantity and quality of available deals. This robust deal flow allows Ollie's to further strengthen its value proposition and invest in price, reinforcing its 'good stuff, cheap' model.

    04

    Ollie's Army Loyalty Program Growth

    The Ollie's Army loyalty program continues to be a key strategic priority, growing 13% to 17.5 million members in the quarter. These members account for over 80% of sales. The company focuses on attracting new members and retaining them through exclusive events like Ollie's Army Night and Ollie's Days, making the program more compelling and enabling tailored marketing for trend products.

    05

    Supply Chain and Distribution Center Investments

    Ollie's is reinvesting in its distribution centers to enhance throughput, productivity, and capacity. The replacement of the warehouse execution system in the Texas DC was completed early in the quarter, with productivity benefits observed across the network. The expansion of the Texas DC is on schedule for completion in early Q3, and the Illinois DC expansion will begin later this year, collectively increasing network capacity to over 850 stores.

    06

    Opportunistic Capital Allocation

    The company demonstrated opportunistic capital allocation by repurchasing $53 million of common stock in Q1, reflecting confidence in its business model's durability and earnings power. The full-year share buyback outlook has been raised to $125 million, targeting approximately 50% of free cash flow, while maintaining a strong balance sheet with $526 million in cash and investments and no meaningful long-term debt.

    AI-generated summary of the company’s earnings call. Not investment advice.