Burlington Stores reported strong earnings and comparable store sales, mirroring the performance of other “off-price” retailers who are benefiting from shoppers seeking lower prices. The discount apparel and footwear chain exceeded expectations with third-quarter fiscal 2023 earnings per share of $0.98 and a 6% increase in comparable store sales. Revenue also increased by 12% to $2.29 billion, in line with estimates. This positive performance was attributed to gains in gross margin, merchandise margin, and freight expense.
Earlier this month, Ross Stores also reported stronger-than-expected results, further affirming the trend of consumers seeking more affordable prices in the face of inflation. As a result of Burlington Stores’ strong performance, its shares reached their highest level since August, although they remained in negative territory for the year. This indicates the potential for continued growth and success in the coming months.
The CEO of Burlington Stores, Michael O’Sullivan, highlighted a strong trend in August and September, with November also off to a solid start. He stated that this positive performance is expected to continue as more consumers seek out affordable options to combat inflationary pressures. This news led to a sharp jump in shares on Tuesday following the release of the earnings report, with stock prices jumping over 20%. Overall, it seems that discount retailers are set for continued success as consumer demand for affordability remains high amidst inflationary pressures.