Ollie's Bargain Outlet (OLLI) Q2 2025 earnings summary

Executive summary

• Net sales for Q2 2024 increased 12.4% year-over-year to $578.4 million, driven by new store openings and a 5.8% rise in comparable store sales, exceeding expectations.

• Net income rose 16.1% to $49.0 million, with adjusted EBITDA up 16.4% to $74.5 million and adjusted EPS at $0.78.

• Nine new stores opened in Q2, bringing the total to 525 stores in 31 states, an 8.9% increase year-over-year.

• Ollie's Army loyalty program reached 14.5M members, accounting for over 80% of sales.

• Management raised full-year sales and earnings outlook, targeting 50 new store openings and a return to 40% annual gross margin.

Financial highlights

• Q2 2024 gross profit increased 11.4% to $219.0 million; gross margin declined 30 bps to 37.9% due to product mix.

• SG&A expenses increased 8.2% to $145.7 million, but as a percentage of sales improved by 100 bps to 25.2%.

• Operating income grew 16% to $61M; operating margin up 30 bps to 10.5%.

• Adjusted net income rose 16% to $48M; adjusted EBITDA margin up 50 bps to 12.9%.

• Cash and short-term investments totaled $353.1 million at quarter-end, with inventory up 6.6% to $531.3 million.

Outlook and guidance

• FY2024 net sales guidance raised to $2.276–$2.291 billion, with comparable store sales growth of 2.7%–3.2% and gross margin of 40%.

• Adjusted net income projected at $199–$203 million, or $3.22–$3.30 per diluted share.

• Capital expenditures for 2024 expected at $104 million, including $14 million for 99 Cents Only Stores acquisition.

• 50 new store openings planned, with 25 in Q3 and 12 in Q4.

• Q3 comps expected to be flat due to competitor liquidation; Q4 comps expected slightly above long-term algorithm.