Five Below 2026 Q2 Earnings Beats Expectations with 29.6% Net Income Growth

Five Below reported stronger-than-expected fiscal 2026 Q2 earnings, with both revenue and net income surpassing prior-year results. The company raised its full-year guidance, reflecting confidence in continued momentum despite ongoing tariff pressures.

Revenue
Five Below’s total revenue for the quarter surged 23.7% to $1.03 billion, compared to $830.07 million in the prior-year period. This robust growth reflects the company’s disciplined expansion strategy and strong consumer demand.

Earnings/Net Income
The company’s earnings per share (EPS) rose 30.0% to $0.78, up from $0.60 in the prior year, while net income grew by 29.6% to $42.76 million from $33 million. These gains underscore Five Below’s ability to enhance profitability amid a challenging retail environment.

Price Action
The stock has gained traction in recent trading sessions, with a 1.60% increase on the latest day, a 3.68% rise for the week, and a 1.38% monthly gain, reflecting positive investor sentiment.

Post Earnings Price Action Review
Five Below’s Q2 performance exceeded expectations across multiple metrics, with revenue and earnings rising well above analyst forecasts. The company’s strategic focus on disciplined store expansion and improved unit economics contributed to a 12.4% comp sales increase. Five Below raised its full-year revenue guidance to $4.44 billion to $4.52 billion and anticipates a strong Q3 with revenue between $950 million and $970 million. The company also maintained a resilient 33.4% adjusted gross margin despite tariff pressures, thanks in part to AI-driven inventory optimization. Five Below’s stock responded positively to the report, rising near its 52-week high, with a P/E ratio of 22.5 and a price-to-sales ratio of 1.93 suggesting an attractive valuation. With $670 million in cash reserves and a confident outlook for the back-half of the year, the company appears well-positioned for continued growth.

CEO Commentary
CEO Winnie Park attributed the strong performance to initiatives like curated newness, simplified pricing, improved in-stock levels, and creator-driven marketing. Park highlighted a 24% sales increase and 12.4% comp sales growth, driven by cost leverage and disciplined expense management. She expressed optimism about the holiday season and the company’s ability to deliver value despite ongoing tariff challenges.

Guidance
Five Below updated its full-year guidance to $4.44 billion to $4.52 billion in revenue and $4.76 to $5.16 in adjusted diluted EPS, with a projected 5% to 7% same-store sales increase. For Q3, the company expects revenue of $950 million to $970 million and plans to open approximately 50 new stores.

Additional News
Five Below raised its full-year sales outlook to $4.44 billion to $4.52 billion, driven by the opening of approximately 150 new stores and an expected 5% to 7% increase in same-store sales, a significant increase from its earlier forecast of $4.33 billion to $4.42 billion. CEO Winnie Park emphasized the company’s strategy of simplifying pricing while maintaining value and improving product availability, a move she said enhances both customer experience and operational efficiency. The company’s shares rose 1.5% after hours following the earnings release, with the stock up 37.6% year-to-date. Five Below is navigating broader retail challenges posed by U.S. tariffs on imports, which have increased supply chain costs and pressured pricing across the sector.