"Disruptions in supply for the retail industry often turn out well for off-price. The tariffs that were announced in early April were of scope and a scale well beyond the expectations of most analysts. The 90-day reduction in tariff for China from 145% to 30% has completely reversed the dynamic."
— Michael O'Sullivan
03Detailed Report
BURL
Company BURL
Period
Q1 2025
CurrencyUSD
Report TypeQuarterly Earnings
GeneratedMay 21, 2026
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Executive Summary
Burlington Stores delivered a solid top-line year-over-year gain in Q1 2025 (revenue $2.504B, +6.0% YoY) with flat comp-store sales and margin resilience despite tariff-related headwinds. The quarter featured meaningful margin discipline and timing benefits that lifted adjusted EBIT and EPS ahead of guidance, while management reaffirmed full-year guidance in a more uncertain macro environment. Management stressed long-term structural benefits for off-price retail, highlighted the ongoing push to accelerate Burlington 2.0 initiatives (Merchandising 2.0 and Store Experience 2.0), and outlined a robust store-expansion plan (100 net new stores in 2025) aided by opportunistic JOANN leases secured for 2026 openings. However, the business faces meaningful near-term cash-flow headwinds, a high leverage profile, and ongoing tariff and macroeconomic uncertainty that could pressure gross margins and working capital. Investors should weigh Burlington’s ability to translate margin savings, inventory reserve strategy, and accelerated store growth into a sustainable cash-flow profile against a backdrop of elevated debt and negative near-term free cash flow. The company’s decisive actions on cost control, merchandising agility, and capital allocation (share repurchases continued) provide a framework for potential upside if tariff volatility normalizes and consumer trends stabilize.
Key Performance Indicators
Revenue
Increasing
2.50B
QoQ: -23.59% | YoY: 6.03%
Gross Profit
Increasing
1.10B
43.89% margin
QoQ: -21.99% | YoY: 15.82%
Operating Income
Increasing
139.09M
QoQ: -60.56% | YoY: 9.86%
Net Income
Increasing
100.83M
QoQ: -61.33% | YoY: 28.43%
EPS
Increasing
1.60
QoQ: -60.20% | YoY: 30.08%
Revenue Trend
Margin Analysis
Financial Highlights
Revenue: $2.504B in Q1 2025, +6.0% YoY; Gross profit: $1.0989B; Gross margin: 43.89%; Operating income: $139.1M; Operating margin: 5.55%; Net income: $100.8M; Net margin: 4.03%; EPS (GAAP): $1.60; EPS (diluted): $1.58; Weighted avg shares: ~63.09M; Cash and cash equivalents: $371.1M; Short-term debt: $412.4M; Long-term debt: $4.916B; Total debt: $5.329B; Cash flow from operations: -$28.9M; Free cash flow: -$433.2M; Capex (net): -$404.3M; Inventory: $1.315B; Total current assets: $2.072B; Total assets: $8.550B; Total current liabilities: $1.956B; Total liabilities: $7.198B; Total stockholders’ equity: $1.352B; Current ratio: 1.06; Quick ratio: 0.39; Gross margin expansion driven by merchandise margin (up 20 bps) and lower freight (down 10 bps); Reserve inventory: 48% of total inventory (up from 40%), reserve value up 31% YoY; Store count: 1,115 at quarter-end; Opened 7 net new stores in Q1; Guidance maintained for 2025: revenue +6% to +8%; comp flat to +2%; Adjusted EBIT margin flat to +30 bps; EPS $8.70–$9.30; Capex net ~$950M. A dividend policy was not in focus; management emphasized capital allocation via ongoing buybacks (spent $105M in Q1; $158M remaining on prior authorization; new $500M authorization approved).
YoY and QoQ context: Revenue YoY +6.0% (per earnings metrics), Gross Profit YoY +15.8%, Operating income YoY +9.9%, Net income YoY +28.4%; QoQ declines reflect seasonality and one-off timing in receipts, with Q1 results at the midpoint of guidance. Key drivers cited by management include Tariff-driven margins and consumer softness, offset by margin-expansion initiatives and inventory reserve strategies.
Income Statement
Metric
Value
YoY Change
QoQ Change
Revenue
2.50B
6.03%
-23.59%
Gross Profit
1.10B
15.82%
-21.99%
Operating Income
139.09M
9.86%
-60.56%
Net Income
100.83M
28.43%
-61.33%
EPS
1.60
30.08%
-60.20%
Key Financial Ratios
Gross Profit Margin
Good
43.90%
Gross profit margin is healthy and competitive within industry standards
Operating Profit Margin
Fair
9.26%
Operating margin is moderate, room for improvement in cost management
Net Profit Margin
Fair
4.03%
Net profit margin is moderate, room for improvement in cost management
Return on Assets
Weak
1.18%
Return on assets suggests inefficient capital allocation
Return on Equity
Fair
7.46%
Return on equity is acceptable but below top-tier companies
Current Ratio
Adequate
1.06
Current ratio meets minimum requirements but limited cushion
Debt to Equity
High Risk
3.94
Debt-to-equity indicates high leverage and elevated financial risk
P/E Ratio
Growth
36.91x
Elevated P/E suggests growth expectations or premium valuation
Price to Book
High Premium
11.01x
Very high premium suggests asset-light business model or lofty expectations
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