AI Takeaway
Ross Stores delivered a strong Q2 FY2026, with revenue surging 20.6% YoY to $6.01B and net income jumping 35.6% to $650.0M, driven by robust operating leverage and a doubling of operating cash flow.
Revenue
$6.01B
++20.57% YoY
EPS (Basic)
$2.04
++37.84% YoY
Operating Income
$804.03M
++32.57% YoY
Filed · Analysis updated · Source: SEC EDGAR 10-Q filing
Revenue grew 20.6% year-over-year to $6.01B in Q2 FY2026, up from $4.98B in the prior-year period, reflecting strong consumer demand for off-price retail and continued store traffic momentum.
Source: Source: 10-Q Income Statement
Operating income rose 32.6% to $804.0M, with operating margin expanding approximately 120 basis points to 13.4% from 12.2%, indicating that revenue growth outpaced cost increases and drove meaningful profitability improvement.
Source: Source: 10-Q Income Statement
SG&A expenses increased 22.4% YoY to $975.9M, growing slightly faster than revenue at 20.6%, suggesting some incremental cost pressure from labor, store expansion, or administrative costs, though overall margins still expanded.
Source: Source: 10-Q Income Statement
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Upgrade to unlockSG&A expenses grew 22.4% YoY versus revenue growth of 20.6%, indicating that operating costs are rising slightly faster than sales. Sustained cost inflation in labor or occupancy could compress margins if revenue growth moderates.
Source: Source: 10-Q Income Statement
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Upgrade to unlock| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Revenue | $6.01B | $4.98B | +20.57% |
Cost of Revenue | $4.23B | $3.58B | +18.13% |
Operating Income | $804.03M | $606.47M | +32.57% |
Net Income | $649.96M | $479.25M | +35.62% |
EPS (Basic) | $2.04 | $1.48 | +37.84% |
EPS (Diluted) | $2.02 | $1.47 | +37.41% |
SG&A Expense | $975.86M | $797.13M | +22.42% |
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Total Assets | $15.55B | $14.3B | +8.74% |
Current Assets | $7.57B | $6.88B | +10.16% |
Current Liabilities | $4.91B | $4.44B | +10.80% |
Stockholders' Equity | $6.31B | $5.58B | +13.07% |
Cash & Equivalents | $4.13B | $3.78B | +9.19% |
Long-Term Debt | $1.02B | $1.52B | -32.82% |
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Operating Cash Flow | $836.01M | $409.71M | +104.05% |
Investing Cash Flow | $-208.95M | $-207.38M | -0.76% |
Financing Cash Flow | $-1.09B | $-1.15B | +5.21% |
Share Buybacks | $318.75M | $262.52M | +21.42% |
D&A | $132.6M | $115.94M | +14.37% |
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Operating Margin | 13.4% | 12.2% | +1.21% |
Net Margin | 10.8% | — | — |
ROE | 10.3% | — | — |
ROA | 4.2% | — | — |
Current Ratio | $1.541 | — | — |
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Ross Stores reported strong Q2 FY2026 results with revenue of $6.01B, up 20.6% YoY, and net income of $650.0M, up 35.6% YoY. Diluted EPS came in at $2.02, a 37.4% increase from $1.47 in the prior-year quarter.
The key takeaways from ROST's Q2 FY2026 report include significant revenue growth of 20.6%, operating margin expansion to 13.4% from 12.2%, and operating cash flow more than doubling to $836M. The company also reduced long-term debt by 32.8% to $1.02B while increasing share buybacks by 21.4% to $318.8M.
Yes, Ross Stores expanded its operating margin to approximately 13.4% in Q2 FY2026 from 12.2% in the prior-year period, an improvement of roughly 120 basis points. Net margin also improved to 10.8%, reflecting strong operating leverage as revenue growth outpaced cost increases.
Ross Stores is in strong financial health, with $4.13B in cash, a current ratio of 1.54, and long-term debt of only $1.02B against $6.31B in stockholders' equity. Operating cash flow doubled YoY to $836M, providing significant financial flexibility for capital returns and investment.
Ross Stores' diluted EPS grew 37.4% YoY to $2.02 in Q2 FY2026, up from $1.47 in the same quarter last year. EPS growth outpaced net income growth of 35.6%, partly reflecting the benefit of ongoing share repurchases which reduced the diluted share count.