Why did OLLI's Q3 and Q4 2025 EPS underperform?

Ollie's Bargain Outlet Holdings, Inc. (OLLI) experienced a decline in EPS performance in both Q3 and Q4 2025 compared to the previous year, which can be attributed to several key factors: 1. **Strategic Shifts and Expenses**: The company's aggressive growth strategy, as highlighted in the acquisition of more than 60 location leases and plans to accelerate store openings, likely led to increased expenses related to new store openings and operational setup. These expenses can temporarily strain financial performance, leading to lower EPS. 2. **Market Dynamics and Competition**: The discount retailer industry is highly competitive, and Ollie's Bargain Outlet faces challenges from shifting market dynamics and competition. These factors could impact customer spending patterns and force the company to adjust pricing strategies, which might affect profitability and, consequently, EPS. 3. **Gross Margin Pressure**: While Ollie's Bargain Outlet has demonstrated effective cost control and strong profitability with high gross margins, such as 41.15% and 40.53%, there may be pressure on gross margin due to changes in pricing strategies, inventory management, or supply chain disruptions. This pressure can translate to lower EPS if not managed properly. In summary, the underperformance in EPS for Ollie's Bargain Outlet in Q3 and Q4 2025 can be attributed to a combination of strategic shifts and increased expenses, competitive pressures, and potential challenges in maintaining gross margins.