Tractor Supply Co (TSCO) investor relations material

Executive summary

• Net sales grew 7.2% year-over-year to $3.72 billion in Q3, driven by strong seasonal and core category performance, new store openings, and increased transaction count and average ticket.

• Net income rose 7.4% to $259.3 million, and diluted EPS increased 8.6% to $0.49, retroactively adjusted for a 5:1 stock split.

• Customer engagement reached record highs, with over 80% of sales from club members and digital sales growing at a low double-digit rate.

• 29 new stores opened in the quarter, bringing the year-to-date total to 68, and nearly 700 garden centers expanded, with continued investments in store upgrades and strategic initiatives.

• Operational highlights included new merchandising collaborations, community engagement initiatives, and the closure of one Petsense by Tractor Supply store.

Financial highlights

• Gross margin increased 15 basis points to 37.4%, supported by disciplined cost management and offsetting tariff and transportation pressures.

• SG&A expenses rose 8.4% to $1.05 billion, representing 28.1% of net sales, up from 27.8% last year, mainly due to strategic investments and higher incentive compensation.

• Operating margin was 9.2%, down 14 basis points year-over-year.

• Diluted EPS was $0.49, up from $0.45 in the prior year, and $197.3 million was returned to shareholders in Q3 via dividends and share repurchases.

• Effective tax rate for the quarter was 21.0%, down from 22.3% last year.

Outlook and guidance

• Fiscal 2025 guidance narrowed: net sales growth of 4.6%-5.6%, comparable store sales growth of 1.4%-2.4%, operating margin of 9.5%-9.7%, net income of $1.09B-$1.14B, and diluted EPS of $2.06-$2.13.

• Q4 comparable store sales expected to increase 1%-5%, with winter weather as a key variable.

• For 2026, plan to open 100 new stores, with expectations for normalized investment levels and margin improvement as strategic initiatives begin to self-fund.