Ross Stores Inc (0KXO.L) Q1 2025 Earnings Report

Ross Stores delivered a results backdrop characterized by top-line softness and disciplined cost management in QQ1 2025. Revenue declined 5.72% year-over-year to $4.984B, with a sequential quarterly drop of 15.68%, underscoring continued consumer headwinds for discretionary apparel. Despite lower revenue, gross profit declined 6.15% YoY to $1.403B, with gross margin at 28.16%, indicating a modest compression versus the prior-year period but relative margin stability given promotional dynamics. Operating income reached $606.5M, delivering a margin of roughly 12.16%, while net income of $479.3M and EPS of $1.48 reflect resilient profitability in a softer top line environment. Free cash flow supplied by operations was $409.7M, and after capex of $207.4M, free cash flow totaled $202.3M, supporting deleveraging and value-creative capital allocation. The balance sheet remains solid with $3.78B of cash and equivalents and a net debt position of approximately $1.23B, yielding a healthy liquidity profile and strong coverage metrics. Management commentary (where available) centers on inventory discipline, store productivity, and selective investments in omnichannel capabilities while remaining cautious on near-term demand volatility. Overall, Ross Stores appears defensively positioned within the Consumer Cyclicals space: meaningful earnings quality, strong cash generation, and prudent capital deployment, albeit with near-term revenue pressures that warrant close monitoring of consumer sentiment, promotional intensity, and supply chain costs.