Citi Trends (CTRN) Q1 2027 earnings summary

Executive summary

• Q1 2026 total sales rose 14.4% to $230.9 million, with comparable store sales up 13.9% year-over-year and a two-year stack of 23.8%.

• Net income increased to $7.8 million from $0.9 million in Q1 2025, and adjusted EBITDA more than doubled to $13.9 million.

• Growth was driven by increased customer traffic, larger basket size, and broad-based sales increases across all product divisions and geographies.

• Strategic focus on trend, style, and value in merchandising, with extreme value deals and a three-tiered strategy driving loyalty.

• Store growth strategy includes new openings and remodels, with new stores exceeding expectations and 591 stores operated across 33 states as of May 2, 2026.

Financial highlights

• Net sales: $230.9 million, up from $201.7 million year-over-year.

• Adjusted EBITDA was $13.9 million, more than doubling from $6.4 million in Q1 2025; adjusted EBITDA margin expanded to 6.0%.

• Gross margin expanded by 40 basis points to 40%, driven by improved merchandise margins.

• Adjusted SG&A expenses were $78.3 million, or 33.9% of sales, leveraging 250 basis points year-over-year.

• Net income: $7.8 million, up from $0.9 million year-over-year.

• Cash and cash equivalents: $81.1 million at quarter-end, with no debt and no borrowings under a $75 million credit facility.

Outlook and guidance

• Fiscal 2026 comparable store sales growth expected at 8%-10%, with total sales projected to grow 9%-11%.

• Gross margin expected to expand 50-70 basis points over 2025, offset by higher freight expenses.

• Adjusted SG&A leverage expected at 130-160 basis points versus 2025.

• Adjusted EBITDA guidance raised to $35-$40 million, with margin expanding 200 basis points.

• Plans to open 25 new stores, close 4, and remodel 50 locations in 2026; capital expenditures expected at $35-$40 million.