Citi Trends' Stellar Q1 Performance: Exceeds Expectations and Boosts Full-Year Forecast

Citi Trends, the off-price retailer, has announced exceptional first-quarter results for 2025, significantly surpassing analyst expectations for both earnings and revenue. This strong performance has led the company to raise its full-year outlook, signaling the positive impact of its ongoing strategic transformation efforts.

Citi Trends Soars: Q1 Earnings Shatter Estimates, Full-Year Outlook Raised

Citi Trends reported an adjusted earnings per share of $0.17 for the first quarter, a remarkable turnaround from the anticipated $0.27 loss per share. Revenue also exceeded forecasts, reaching $201.7 million against an expectation of $194.81 million. This robust financial showing underscores the effectiveness of the company's strategic initiatives.

Key Performance Indicators Highlight Growth

• Comparable Store Sales: A significant 9.9% year-over-year increase, driven by higher traffic, larger basket sizes, and improved conversion rates.

• Total Sales: Rose by 8.3% to $201.7 million compared to the same period last year.

• Gross Margin Expansion: Increased by 90 basis points to 39.6%, attributed to higher initial markups, reduced shrink, and lower freight costs.

• Adjusted EBITDA: A strong $5.4 million, a substantial improvement from an adjusted EBITDA loss of $0.8 million in Q1 2024.

Strategic Transformation Yields Results

CEO Ken Seipel expressed satisfaction with the progress of the company's strategic transformation journey, highlighting the strong top-line and bottom-line results, as well as better-than-expected adjusted EBITDA flowthrough. He emphasized that the refined approach to serving African American customers through curated assortments, enhanced in-store experiences, and compelling off-price value is resonating, leading to increased transaction counts.

Analyst Confidence and Future Outlook

DA Davidson analysts have reiterated their "Buy" rating for Citi Trends stock, maintaining a price target of $29.00. They noted Citi Trends as one of only two companies in their coverage to raise guidance this earnings season. The company's ability to exceed expectations across key financial metrics has reinforced DA Davidson's confidence in its future prospects.

Citi Trends has raised its full-year outlook, now projecting mid-single-digit comparable store sales growth and an EBITDA between $6 million and $10 million. The retailer also plans to open up to five new stores and remodel approximately 50 locations during the current fiscal year, further solidifying its growth trajectory.

Sources

• DA Davidson maintains buy rating on Citi Trends stock after earnings beat By Investing.com, Investing.com India.

• Citi Trends beats Q1 estimates, raises full-year outlook By Investing.com, Investing.com India.

• Citi Trends übertrifft Q1-Erwartungen und hebt Jahresprognose an Von Investing.com, Investing.com Deutsch.

• Citi Trends earnings beat by $0.44, revenue topped estimates By Investing.com, Investing.com Nigeria.

• Citi Trends beats Q1 estimates, raises full-year outlook By Investing.com, Investing.com Nigeria.