Store Operations - As of November 1, 2025, the company operates 1,211 stores across 46 states, Washington D.C., and Puerto Rico, having opened 129 new stores during the nine-month period[101] - The company plans to average about 100 net new store openings per year, targeting a total of 500 new stores from Fiscal 2024 through Fiscal 2028[106] - As of November 1, 2025, the company opened 129 new stores, bringing the total store count to 1,211[184] Financial Performance - Net income for the three months ended November 1, 2025, was $104.8 million, up from $90.6 million for the same period in 2024, representing a 15.0% increase[114] - For the nine months ended November 1, 2025, net income increased to $299.8 million from $242.9 million in the prior year, reflecting a 23.4% growth[114] - Adjusted Net Income for the three months ended November 1, 2025, rose to $107.5 million, an increase of $7.6 million compared to the same period last year[121] - Net income for Q3 Fiscal 2025 was $104.8 million, compared to $90.6 million in Q3 Fiscal 2024, primarily due to higher sales and increased gross margin rate[152] - Net sales increased by $562.4 million, or 7.7%, to $7,907.1 million for the nine-month period ended November 1, 2025, driven by 108 net new stores and a 2% increase in comparable store sales[153] Profitability Metrics - Adjusted EBIT increased by $14.6 million to $155.9 million for the three months ended November 1, 2025, and by $67.2 million to $453.1 million for the nine months ended November 1, 2025, compared to the prior year[126] - Adjusted EBITDA rose by $26.4 million to $255.2 million for the three months ended November 1, 2025, and by $97.0 million to $739.0 million for the nine months ended November 1, 2025, driven by higher sales and increased gross margin[126] - Comparable store sales increased by 1% for the three months ended November 1, 2025, and remained stable at 2% for the nine months ended[130] - Gross margin as a percentage of net sales improved to 44.2% during the three months ended November 1, 2025, compared to 43.9% for the same period in 2024[132] Inventory and Cash Flow - Inventory increased to $1,658.4 million as of November 1, 2025, from $1,440.7 million a year earlier, primarily due to an increase in reserve inventory and the opening of 108 new stores[134] - Cash and cash equivalents decreased by $410.6 million during the nine months ended November 1, 2025, compared to a decrease of $67.6 million during the same period in 2024[137] Expenses and Costs - Selling, general and administrative expenses as a percentage of net sales decreased to 35.0% during the three months ended November 1, 2025, from 35.4% in the prior year[142] - Cost of sales as a percentage of net sales decreased to 55.8% during the three months ended November 1, 2025, compared to 56.1% in the same period of 2024[141] - The company incurred $10.9 million in pre-opening costs related to leases acquired through bankruptcy proceedings during the third quarter of Fiscal 2025[143] - Depreciation and amortization expense increased to $99.3 million in Q3 Fiscal 2025 from $87.5 million in Q3 Fiscal 2024, driven by new and non-comparable stores[144] - Impairment charges on long-lived assets were $3.8 million in Q3 Fiscal 2025, up from $3.0 million in Q3 Fiscal 2024, primarily related to one store expected to sell below net carrying value[145] Debt and Financing - The company's total debt obligations include $1,723.3 million under the Term Loan Facility and $297.1 million of 2027 Convertible Notes as of November 1, 2025[185] - The average borrowings during the nine-month period ended November 1, 2025, amounted to $26.9 million at an average interest rate of 5.5%[191] - The company has $947.9 million available under the ABL Line of Credit as of November 1, 2025[191] - The 2027 Convertible Notes bear an interest rate of 1.25% per year and will mature on December 15, 2027[195] - The company entered into a $200.0 million interest rate swap agreement with a fixed interest rate of 3.76% during the second quarter of Fiscal 2025[199] - The company refinanced $933.0 million principal amount of Term B-6 Loans with Term B-7 Loans totaling $1,250.0 million[187] - The company has interest rate swaps hedging $1,100.0 million of variable rate exposure under its Term Loan Facility[200] Risks and Challenges - The company anticipates that ongoing economic uncertainties, including inflation and consumer spending habits, may impact revenues and income[105] - The company faces various risks including general economic conditions, competitive factors, and seasonal fluctuations that could impact net sales and operating income[205] - The company acknowledges potential disruptions in its distribution network and the need to protect information systems against cyber-related attacks[205] - The company emphasizes the importance of adapting to changing consumer preferences and demand to sustain growth plans[205] - The company is subject to various regulatory requirements and must comply with increasingly rigorous privacy and data security regulations[205] - The company notes that past financial performance should not be relied upon as an indication of future performance due to unpredictable factors[206] - The company has not reported any material changes to its market risk disclosures since the last fiscal report[208] - Recent accounting pronouncements have been discussed in the condensed consolidated financial statements, indicating ongoing compliance efforts[207]

Core Insights - Burlington Stores, Inc. is a significant player in the discount retail sector, operating a chain of off-price retail stores that offer a variety of products including clothing, home goods, and accessories [1] Financial Performance - On November 25, 2025, Burlington reported earnings per share (EPS) of $1.68, exceeding the estimated $1.59, continuing a trend of surpassing expectations [2] - In the previous quarter, Burlington achieved an EPS of $1.80, reflecting a 13.21% earnings surprise, and has consistently outperformed consensus EPS estimates over the past four quarters [2] - Burlington's revenue for the latest quarter was $2.71 billion, slightly below the estimated $2.75 billion, but up from $2.53 billion in the same period last year [2][3] - The company has exceeded consensus revenue estimates in two of the last four quarters, indicating strong sales performance overall [3] Market Dynamics - Burlington's stock price declined due to the shortfall in sales expectations, attributed to unusually warm weather that decreased store traffic [3] - A recovery was noted in mid-October with cooler temperatures leading to a mid-single-digit increase in comparable store sales [3] Valuation Metrics - Burlington maintains a price-to-earnings (P/E) ratio of approximately 29.49, indicating investor confidence in its earnings potential [4] - The company's price-to-sales ratio is about 1.45, and its enterprise value to sales ratio is around 1.75, providing insights into its valuation relative to revenue [4] - Burlington has a debt-to-equity ratio of approximately 1.09, suggesting a balanced approach to financing its operations [4]

Key Takeaways Burlington Stores' Q3 earnings beat estimates with revenues up 7.1% year over year.Margin gains from merchandising and execution drove raised Q4 and full-year earnings guidance.The company kept its Q4 comp-sales outlook while highlighting strong store openings and margin progress.Burlington Stores, Inc. (BURL) reported third-quarter fiscal 2025 results, wherein both revenues and earnings grew year over year. Top line lagged the Zacks Consensus Estimate and bottom line surpassed the same.Store ...

Core Insights - Burlington Stores reported revenue of $2.71 billion for the quarter ended October 2025, marking a year-over-year increase of 7.1% and an EPS of $1.80 compared to $1.55 a year ago [1] - The reported revenue matched the Zacks Consensus Estimate, resulting in a surprise of -0.02%, while the EPS exceeded expectations by 13.21% [1] Financial Performance Metrics - The company had 1,211 stores at the end of the period, surpassing the four-analyst average estimate of 1,199 [4] - Comparable store sales increased by 1%, which was below the average estimate of 2.4% from four analysts [4] - Net sales of $2.71 billion were above the four-analyst average estimate of $2.69 billion, reflecting a year-over-year change of +7.1% [4] - Other revenue was reported at $4.44 million, slightly below the three-analyst average estimate of $4.7 million, indicating a year-over-year decline of -1.9% [4] Stock Performance - Shares of Burlington Stores have returned +4.9% over the past month, contrasting with a -1.2% change in the Zacks S&P 500 composite [3] - The stock currently holds a Zacks Rank 3 (Hold), suggesting it may perform in line with the broader market in the near term [3]

Core Viewpoint - Burlington Stores, Inc. reported stronger profit and raised its outlook, but the stock fell due to softer sales momentum and cautious consumer demand [1]. Financial Performance - The company reported third-quarter adjusted earnings per share of $1.80, exceeding the analyst consensus estimate of $1.64 [2]. - Quarterly sales reached $2.710 billion, a 7% year-over-year increase, but fell short of the expected $2.739 billion. Comparable store sales increased by 1% [3]. - Gross margin improved to 44.2%, up from 43.9% in the previous year, with merchandise margin expanding by 10 basis points and freight expense improving by 20 basis points [4]. - Adjusted EBITDA was $266 million, compared to $229 million in the year-ago period, representing an 80 basis point increase as a percentage of sales [4]. Cash and Debt Position - The company ended the quarter with cash and equivalents of $584.079 million. Long-term debt increased to $2.015 billion from $1.542 billion in the previous year [5]. Future Outlook - Burlington Stores raised its 2025 adjusted EPS outlook to $9.69–$9.89, up from $9.19–$9.59, surpassing the $9.52 consensus estimate. Total sales are expected to rise by about 8% for the full year [6]. - The company anticipates net capital expenditures of approximately $950 million and plans to open 104 net new stores [6]. - For the fourth quarter, adjusted EPS is guided to be between $4.50 and $4.70, slightly around the $4.64 Street estimate, with total sales growth expected between 7% and 9% [7]. Management Commentary - CEO Michael O'Sullivan noted a significant drop in store traffic after the back-to-school period due to unseasonably warm temperatures, but indicated a recovery in mid-October with continued strong trends into November [3][8].

Financial Data and Key Metrics Changes - Total sales increased by 7% in Q3, following an 11% growth last year, resulting in year-to-date total sales growth of 8% on top of 11% from the previous year [5][14] - Comparable store sales for Q3 rose by 1%, with a significant drop in traffic due to warmer-than-usual weather impacting sales [5][6] - Adjusted EBIT margin for Q3 was 6.2%, up 60 basis points from last year, exceeding guidance [15][19] - Adjusted earnings per share for Q3 was $1.80, representing a 16% increase year-over-year and well above guidance [15][19] Business Line Data and Key Metrics Changes - Gross margin rate for Q3 was 44.2%, an increase of 30 basis points year-over-year, driven by a 10 basis point increase in merchandise margin and a 20 basis point decrease in freight expenses [14][15] - Product sourcing costs were $214 million in Q3, slightly up from $209 million last year, but decreased by 40 basis points compared to last year due to supply chain efficiencies [15][17] - Store inventories were down 2% year-over-year, with reserve inventory up 26% in dollar terms, indicating a well-balanced inventory strategy [16][17] Market Data and Key Metrics Changes - The Southeast region was the strongest performer in Q3, while the Southwest trailed the chain [78] - Strong performance was noted in beauty, accessories, and shoes, while home category sales were softer [78] Company Strategy and Development Direction - The company plans to open at least 110 net new stores in 2026, reflecting confidence in the new store pipeline and performance [9][60] - The long-term financial goal remains to achieve approximately $1.6 billion in operating income by 2028, with a focus on margin expansion and new store sales [10][63] - The company is cautious about comp sales growth due to economic uncertainties, planning for flat to 2% growth in 2026 [9][45] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the impact of weather on Q3 sales, noting that once temperatures dropped, comp sales improved to mid-single digits [6][22] - The company remains optimistic about the off-price retail sector, indicating that the shift from traditional retail to off-price is likely to continue [51][52] - Management expressed confidence in the resilience of lower-income customers, who have been performing well despite economic challenges [66] Other Important Information - The company repurchased $61 million in stock during Q3, with $444 million remaining on the repurchase authorization [17] - The company is maintaining its fourth quarter guidance for comp sales growth of flat to 2% and total sales growth of 7% to 9% [18][19] Q&A Session Summary Question: Concerns about relative comp performance versus peers - Management acknowledged a 1% comp in Q3 compared to peers' 6% and 7%, attributing part of the gap to weather but recognizing the need for further analysis on performance differences [28][30] Question: Details on operating margin expansion despite lower comp - Management confirmed that choices made to mitigate tariff impacts contributed to higher margins but may have negatively affected sales [39][41] Question: Risks and opportunities in the 2026 outlook - Management highlighted economic uncertainties as potential risks but noted plans for new store openings and margin improvements [44][45] Question: Potential market share loss to competitors - Management emphasized the importance of the overall off-price sector's health and the opportunity to gain market share from non-off-price retailers [51][52] Question: Pricing strategy in Q3 and Q4 - Management stated a cautious approach to pricing, focusing on maintaining low prices while monitoring market trends [56][57] Question: Trends with lower-income customers - Management reported resilience among lower-income customers, with strong performance in stores located in lower-income areas [66] Question: Guidance for Q4 comp sales and earnings - Management reiterated guidance for Q4 comp sales and increased margin expectations, citing strong trends despite cautiousness [68][70] Question: Availability of off-price merchandise - Management characterized the buying environment for off-price merchandise as strong, with good availability heading into Q4 [72][73]

Financial Data and Key Metrics Changes - Total sales increased by 7% in Q3, following an 11% growth last year, resulting in year-to-date total sales growth of 8% on top of 11% from the previous year [5][14] - Comparable store sales for Q3 rose by 1%, with a significant drop in traffic due to warmer-than-usual weather impacting sales [5][6] - Adjusted EBIT margin for Q3 was 6.2%, up 60 basis points from last year, exceeding guidance [15][19] - Adjusted earnings per share for Q3 was $1.80, representing a 16% increase year-over-year [15][19] Business Line Data and Key Metrics Changes - Gross margin rate for Q3 was 44.2%, an increase of 30 basis points year-over-year, driven by a 10 basis point increase in merchandise margin and a 20 basis point decrease in freight expenses [14][15] - Product sourcing costs were $214 million in Q3, compared to $209 million last year, with a 40 basis point decrease in product sourcing costs as a percentage of sales [15][17] - Store inventories were down 2% year-over-year, indicating effective inventory management despite the weather-driven sales slowdown [16] Market Data and Key Metrics Changes - The Southeast region was the strongest performer in Q3, while the Southwest trailed the chain [78] - Strong performance was noted in beauty, accessories, and shoes, while home category sales were softer [78] Company Strategy and Development Direction - The company plans to open 110 net new stores in 2026, reflecting a strong new store pipeline and performance from new stores [9][60] - The long-term financial goal remains to achieve approximately $1.6 billion in operating income by 2028, with a focus on margin expansion and new store sales [10][63] - The company is cautious about comp sales growth due to economic uncertainty, planning for flat to 2% growth in 2026 [9][20] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the impact of weather on Q3 sales, noting that once temperatures dropped, comp sales improved to mid-single digits [6][22] - The company remains optimistic about the off-price retail sector, indicating that the shift from traditional retail to off-price is likely to continue [51][52] - Management expressed confidence in the resilience of lower-income customers, who have been outperforming the chain [66] Other Important Information - The company repurchased $61 million in stock during Q3, with $444 million remaining on the repurchase authorization [17] - The company is maintaining its fourth quarter guidance for comp sales growth of 0% to 2% and total sales growth of 7% to 9% [18][19] Q&A Session Summary Question: Concerns about relative comp performance versus peers - Management acknowledged a 1% comp in Q3 compared to peers' 6% to 7%, attributing part of the gap to weather but recognizing the need for further analysis on performance differences [28][30] Question: Details on operating margin expansion despite lower comp - Management confirmed that decisions made to mitigate tariff impacts contributed to higher margins but may have negatively affected sales [39][41] Question: Risks and opportunities in the 2026 outlook - Management highlighted economic uncertainty as a key risk but noted potential tailwinds such as higher tax refunds [44][45] Question: Market share risks from competitors - Management emphasized that the off-price sector's overall health benefits all players, including Burlington, and that market share gains are primarily coming from non-off-price retailers [51][52] Question: Pricing strategy in Q3 and Q4 - Management stated a cautious approach to pricing, avoiding increases unless necessary, and indicated a potential for more aggressive pricing in Q4 depending on market conditions [56][57] Question: New store openings and productivity - Management expressed confidence in the new store pipeline, with recent openings performing well and contributing to total sales growth [60][62]

Financial Data and Key Metrics Changes - Total sales increased by 7% in Q3 2025, following an 11% growth in the same quarter last year, resulting in year-to-date total sales growth of 8% on top of 11% from the previous year [4][13] - Comparable store sales for Q3 increased by 1%, with a significant drop in traffic due to warmer-than-usual weather impacting sales [4][5] - Adjusted EBIT margin for Q3 was 6.2%, which is 60 basis points higher than last year, exceeding guidance expectations [14][19] - Adjusted earnings per share for Q3 was $1.80, representing a 16% increase compared to the prior year [14][19] Business Line Data and Key Metrics Changes - The gross margin rate for Q3 was 44.2%, an increase of 30 basis points year-over-year, driven by a 10 basis point increase in merchandise margin and a 20 basis point decrease in freight expenses [13][14] - Product sourcing costs were $214 million in Q3, slightly up from $209 million last year, but decreased by 40 basis points compared to last year due to supply chain efficiencies [13][14] - Store inventories were down 2% year-over-year, indicating effective inventory management despite the weather-driven sales slowdown [15][16] Market Data and Key Metrics Changes - The Southeast region was the strongest performer in Q3, while the Southwest trailed behind the chain average [72] - Strong performance was noted in beauty, accessories, and shoes, while home category sales were softer [72] Company Strategy and Development Direction - The company plans to open 110 net new stores in 2026, reflecting confidence in the new store pipeline and performance [8][20] - The updated full-year 2025 guidance indicates an EBIT margin expansion of 60-70 basis points, despite tariff pressures [7][19] - The company aims for average annual comp sales growth of 4-5% over the remaining years of its long-range plan [11][58] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the significant impact of weather on Q3 sales, particularly in cold weather categories, and expressed optimism about recent trends as weather normalized [5][21] - The company is cautious about the economic environment for 2026, planning conservatively for comp sales growth of flat to 2% [8][20] - Management emphasized the importance of adapting to market conditions and learning from off-price peers to maintain competitiveness [46][48] Other Important Information - The company repurchased $61 million in stock during Q3, with $444 million remaining on the repurchase authorization [17] - Reserve inventory was 35% of total inventory, up from 32% last year, indicating a strategic approach to manage inventory levels [16] Q&A Session Summary Question: Concerns about relative performance compared to peers - Management acknowledged a 1% comp in Q3 compared to peers' 6-7%, attributing part of the difference to weather but recognizing the need for improvement in performance [26][28] Question: Details on operating margin expansion - Management highlighted a 60 basis point increase in operating margin, driven by merchandise margin improvements and cost efficiencies despite tariff pressures [29][30] Question: Impact of decisions on margin versus sales - Management confirmed that some decisions made to enhance margins may have negatively impacted sales, particularly in light of tariff mitigation strategies [34][35] Question: Trends with lower-income customers - Management reported resilience among lower-income customers, with strong performance in stores located in lower-income trade areas [60][61] Question: Guidance for fourth quarter - Management maintained Q4 guidance for comp sales of flat to 2% and total sales growth of 7-9%, while increasing margin and EPS guidance [63][64]

Core Viewpoint - Burlington Stores reported quarterly earnings of $1.8 per share, exceeding the Zacks Consensus Estimate of $1.59 per share, and showing an increase from $1.55 per share a year ago, resulting in an earnings surprise of +13.21% [1][2] Financial Performance - The company achieved revenues of $2.71 billion for the quarter ended October 2025, slightly missing the Zacks Consensus Estimate by 0.02%, but up from $2.53 billion year-over-year [2] - Over the last four quarters, Burlington Stores has surpassed consensus EPS estimates four times and topped revenue estimates two times [2] Stock Performance and Outlook - Burlington Stores shares have decreased by approximately 0.2% since the beginning of the year, contrasting with the S&P 500's gain of 14% [3] - The company's current Zacks Rank is 3 (Hold), indicating expected performance in line with the market in the near future [6] Future Earnings Expectations - The current consensus EPS estimate for the upcoming quarter is $4.57 on revenues of $3.55 billion, and for the current fiscal year, it is $9.42 on revenues of $11.47 billion [7] - The estimate revisions trend for Burlington Stores was mixed ahead of the earnings release, which may change following the recent report [6] Industry Context - The Retail - Discount Stores industry is currently ranked in the top 39% of over 250 Zacks industries, suggesting that companies in the top 50% outperform those in the bottom 50% by more than 2 to 1 [8]

Core Insights - Burlington Stores' stock experienced a decline following the company's failure to meet sales expectations, attributed to unusually warm weather impacting store traffic [1] Company Summary - The company reported a significant drop in store traffic due to warm weather conditions, which negatively affected sales performance [1] Industry Summary - The retail industry is facing challenges with weather-related impacts on consumer shopping behavior, highlighting the importance of seasonal factors in sales forecasting [1]