Boot Barn (BOOT) TD Cowen 10th Annual Future of the Consumer Conference summary

Fiscal performance and outlook

• Fiscal 2026 ended with +7% comps, over $2B in sales, and a record 80 new stores opened; fiscal 2027 Q1 is tracking at the high end of guidance with strong momentum continuing.

• Consumer health is broad-based across demographics and merchandise categories, with notable acceleration in work boots and consistent growth in core denim.

• Guidance for fiscal 2027 includes 2%-4% comp growth, AUR up 2%-3%, and transactions expected to be flat to up 1%.

• Merchandise margin is guided to expand 50 bps, with EBIT margin expected to reach 13.5% at the high end, progressing toward a 15% long-term goal.

• Store growth remains robust, with confidence in expanding to 1,200 locations, supported by internal and third-party TAM analysis.

Strategic initiatives and execution

• Four long-standing strategic pillars: new store openings, same-store sales, margin expansion, and omni-channel/digital initiatives.

• Focus remains on core assortments and replenishment, balanced with regular newness in stores to maintain customer engagement.

• Exclusive brands now exceed 40% penetration, with a path to 50% driven by marketing, direct sourcing, and brand awareness initiatives.

• Exclusive brands deliver 1,000 bps higher margin than third-party brands; direct sourcing expected to add 100-200 bps margin expansion by fiscal 2028.

• Marketing leverages Meta and TikTok for brand discovery, with AI-driven audience building and upcoming TV campaigns.

Operational highlights and cost management

• Reduced promotional activity and improved buying economies of scale are supporting margin expansion.

• Freight cost improvements and vendor negotiations are offsetting transportation and macro cost pressures.

• Occupancy expense increased due to rapid store openings and unique high-traffic locations, but new stores are performing well.

• AI is being used for internal efficiencies, data analysis, and innovative product design, including virtual runways for exclusive brands.

• Store expansion is balanced between infill and new markets, with success in both rural and urban areas, and select high-profile locations for branding and sales.