Dillard's earnings beat sparks stock rally: What you need to know

Dillard's, Inc. (DDS) unveiled its fourth quarter fiscal year 2023 earnings, surpassing analyst predictions for earnings per share (EPS) and revenues, sending its shares up. The company reported an EPS of $15.44, outdoing analyst expectations by $3.09. Its quarterly revenue remained steady year-over-year at $2.16 billion, aligning with forecasts.

During the 13-week period, total retail sales saw a 5% decline, mirroring a 5% drop in comparable store sales. Net income for the quarter stood at $250.5 million, a decrease from the previous year's $289.2 million.

The quarter's retail gross margin was 37.7% of sales, a slight dip from the previous year's 38.7%. Operating expenses rose to $476.7 million, or 22.4% of sales, up from $458.4 million, or 21.6% of sales, a year ago.

Dillard's further reported repurchasing $16.2 million worth of shares, about 52,000 shares, within the quarter. The year ended with the company holding $956 million in cash and short-term investments.

For the entire fiscal year, Dillard's posted a net income of $738.8 million, or $44.73 per share, down from $891.6 million, or $50.81 per share, in the prior year. The annual retail gross margin was 41.8% of sales, slightly lower than the previous year's 43.0%.

Yearly operating expenses were $1,717.4 million, or 25.4% of sales, compared to $1,674.3 million, or 24.4% of sales, the previous year. The company also repurchased $281.4 million worth of shares, around 917,700 shares, at an average price of $306.66 per share. As of February 3, 2024, Dillard's had $394.0 million left for additional share repurchases under its May 2023 program.

Dillard's robust fourth quarter fiscal year 2023 earnings, outperforming in both EPS and revenue forecasts, alongside significant share repurchases, underscore its financial health. As it navigates a challenging consumer landscape, its strategic focus on cost efficiency and enhancing shareholder value remains key to its ongoing success.