Ollie's Bargain Outlet beats on earnings, trims sales forecast

Ollie's Bargain Outlet (NASDAQ:OLLI) shares jumped 7.5% after the discount retailer posted second-quarter adjusted earnings that topped Wall Street estimates, even as revenue fell short of expectations.

The company reported adjusted earnings per share of $1.42, beating the average analyst estimate of $1.14 and up 43.43% from $0.99 a year earlier.

Revenue rose 9.09% year-over-year to $741.3 million, missing the $752.9 million analysts had forecast by 1.53%.

Ollie's operated 686 stores, up 11.9% from a year ago, after opening 15 locations and closing one during the quarter.

Membership in the company's loyalty program, Ollie's Army, grew 12.7% to 18.1 million.

For fiscal 2026, Ollie's raised its adjusted EPS guidance to a range of $4.57 to $4.65, above the $4.47 analysts had expected.

The company cut its full-year sales guidance to a range of $2.928 billion to $2.941 billion, below the $2.983 billion estimate.

Jefferies analysts said the quarter underwhelmed, with same-store sales and gross margin coming in slightly below guidance while SG&A expenses ran higher than expected.

Tariff refunds boosted gross margin by 380 basis points during the quarter, though the analysts said the Street will likely look past that benefit.

They noted the updated annual comparable sales guidance of 0% to 0.5%, down from a prior forecast of 2% growth, points to some improvement in trend heading into the third quarter, against an easier comparison.

The analysts also pointed to the company's balance sheet, which they described as a $500 million cash war chest, and said they would be buyers of the stock with shares at cycle lows on both an absolute and relative basis.