FRAMINGHAM, Massachusetts: This week, TJX Companies forecasted current-quarter profits to be below Wall Street expectations, indicating that rising costs were affecting the retailer's margins despite steady demand for bargains from customers.
Like several other U.S. retailers, T.J. Maxx has been struggling with higher costs caused by supply chain issues and higher wages despite freight-related expenses coming down.
Jane Hali & Associates analyst Jessica Ramirez said, "TJX's fourth-quarter guidance has been slightly conservative."
TJX's selling, general, and administrative expenses rose 18 percent in the third quarter, but as it benefited from customers shifting to cheaper alternatives amid a higher cost-of-living crisis, the company raised its full-year sales and profit forecasts.
CEO Ernie Herrman said, "Customer traffic was up across all divisions. The fourth quarter was off to a strong start."
Fiscal 2024 comparable store sales will be between four percent and five percent, up from an earlier forecast of between three percent and four percent, the company said.
Adjusted earnings for fiscal 2024 will be between US$3.61 and $3.64 per share, up from the previous forecasts of between $3.56 and $3.62 per share, the company added. Analysts predict a profit of $3.73 per share.