Dive Brief:
- Despite new trade policy challenges, Five Below’s first quarter net sales increased 19.5% year over year to $970.5 million, according to a company press release Wednesday. The discount retailer’s comparable sales rose 7.1% and net income jumped 30.8% to $41.1 million.
- Five Below raised its full-year guidance, now expecting net sales to range from $4.33 billion to $4.42 billion (compared to its previously expected $4.21 billion to $4.33 billion range), comps to increase between 3% and 5% (from flat to up 3%) and net income to land between $223 million and $249 million (compared to $216 million to $250 million).
- The retailer’s Chief Financial Officer and Treasurer Kristy Chipman will step down from the position effective Friday, per an SEC filing. Chief Operating Officer Kenneth Bull will serve as interim chief financial officer and treasurer (a role he previously held for over a decade) as the company searches for a replacement.
Dive Insight:
Five Below kicks off a new fiscal year with a solid performance as the retail industry grapples with sudden shifts in trade policy.
"Our first quarter results demonstrate the effectiveness of our strategy, grounded in trend-right product, extreme value and a fun store experience,” CEO Winnie Park said in a statement. “We were pleased to see broad-based strength across the majority of our merchandising worlds, resulting in a transaction-driven 7.1% increase in comparable sales, as well as strong performance from our new stores.”
Park also thanked Chipman for her contributions to the company, which she had worked at since 2023, per LinkedIn. Chipman’s departure comes as Five Below co-founder Tom Vellios is set to depart the company as executive chairman of the board on Thursday. The previously announced move for Vellios means he will serve in an advisory role through the end of the year.
On a call with analysts Wednesday, Park said the company had a heightened focus on newness this past quarter that included sourcing timely and trendy products. The retailer opened 55 new stores across 20 states and plans to open about 150 net new stores for the full fiscal year.
The CEO said the company has been working to mitigate the impact of ever-changing U.S. tariff policies. Five Below’s plans have included vendor negotiations and sourcing diversification, as well as assortment and price adjustments. Park said the company’s efforts have already reduced its goods sourced from China by about 10 percentage points for the back half of the year.
Five Below’s latest results follow news in March that it hired former Forever 21 chief marketing, digital and omni officer, Jacob Hawkins, as its new chief marketing officer. The appointment came just a few months after Park left her role as CEO at Forever 21 in December to lead Five Below. The chief executive told analysts on the call Wednesday that marketing is an important focus for Five Below as it seeks to inform customers of its value during key moments in life, such as holidays or back-to-school.
