Feb 25 (Reuters) - TJX Cos forecast annual sales and profit below Wall Street estimates on Wednesday despite a quarterly results beat, signaling strained discretionary spending among budget-conscious consumers amid macroeconomic uncertainty.
The TJ Maxx and Marshalls parent faces mounting concerns over declining nice-to-have purchases as living costs continue to rise. Margin pressures are also intensifying, with economic challenges weighing on its primarily lower-income shopper core customer base,
leading to smaller basket sizes and softer demand.
Meanwhile, businesses are expected not to cut prices despite the U.S. Supreme Court striking down the White House's emergency tariffs, casting a pall on consumer spending.
The company also faces fierce competition from rivals such as Ross Stores, Burlington Stores, fast-fashion chains such as Shein and digital marketplace Amazon, all of which are expanding their discount offerings.
TJX expects annual comparable sales to rise between 2% and 3%, compared to analysts' average estimate of a 3.5% growth, according to data compiled by LSEG.
It forecasts earnings per share for fiscal 2027 to be between $4.93 and $5.02, compared to analysts' average estimate of $5.18 per share.
However, the off-price retailer reported a quarterly comparable sales rise of 5%, above an estimate of 3.6% growth.
Adjusted earnings per share for the fourth quarter came in at $1.43, surpassing an expectation of $1.39 per share, according to data compiled by LSEG.
Overall store traffic increased 2.8% at TJ Maxx outlets and 3.3% at Marshalls outlets in the quarter compared to the year-ago period, according to data from Placer.ai, boosted by the holiday season.
(Reporting by Neil J Kanatt in Bengaluru; Editing by Pooja Desai)
