Citi Trends, Inc. (NASDAQ: CTRN) raised its fiscal 2026 sales and profit guidance on August 25, 2026, after reporting comparable-store sales growth of 10.5% for the second quarter. Total sales for the 13-week quarter ended August 1, 2026, increased 10.9% to $211.6 million, marking the company's eighth consecutive quarter of comparable-store sales growth, the Savannah, Georgia-based retailer said.
Citi Trends operates 594 stores across 33 states, mainly in community shopping centers rather than enclosed malls, and sells apparel, footwear, accessories, beauty, and home goods focused on Black consumers, according to the company's investor materials. It competes with national off-price chains such as Ross Stores and Burlington, which also sell discounted, rotating merchandise to value-focused shoppers.
#Citi Trends Posts Eighth Straight Quarter of Comparable Sales Growth
Total sales for the quarter rose 10.9%, or $20.9 million, to $211.6 million compared with the prior-year quarter, the company said.
Comparable-store sales for the quarter increased 10.5%, or 19.7% on a two-year basis, which Citi Trends attributed to higher average basket size and transaction counts.
Gross margin was 40.6%, an increase of 60 basis points from the prior-year quarter, due to improved merchandise margin and investments to reduce shrink, partly offset by higher freight costs tied to fuel surcharges, the company said.
Selling, general and administrative expenses were $82.3 million, or $80.4 million on an adjusted basis, with adjusted SG&A equal to 38.0% of sales, compared with adjusted SG&A of $77.4 million, or 40.6% of sales, in the prior-year quarter.
Citi Trends reported a net loss of $0.9 million for the quarter, compared with net income of $3.8 million in the prior-year quarter, which included an $11.0 million gain on the sale of the company's Savannah office building.
Adjusted EBITDA was $5.5 million, up $6.6 million from an adjusted EBITDA loss of $1.1 million in the prior-year quarter, the company said.
"CITITRENDS delivered another strong quarter, with comparable store sales increasing 10.5% and 19.7% on a two-year basis," Ken Seipel, Chairman and Chief Executive Officer of Citi Trends, said in the earnings release. "Our disciplined execution is translating that sales momentum into improved profitability, with first half net income of $6.8 million and adjusted EBITDA of $19.4 million, already exceeding the adjusted EBITDA generated for all of fiscal 2025," Seipel said.
#Citi Trends Raises Fiscal 2026 Sales and Profit Guidance
Citi Trends raised its comparable-store sales growth outlook for fiscal 2026 to a range of 9% to 11%, up from a prior outlook of 8% to 10%, the company said.
Total sales growth guidance for the year increased to a range of 10% to 12%, from a previous outlook of 9% to 11%.
The company raised its adjusted EBITDA outlook to a range of $38 million to $42 million, from a prior range of $35 million to $40 million.
Gross margin guidance was unchanged at an expected increase of approximately 50 to 70 basis points, while adjusted SG&A leverage guidance increased to 160 to 180 basis points from a prior range of 130 to 160 basis points.
Citi Trends now expects to open 20 new stores in fiscal 2026, down from a prior estimate of 25, and to complete 10 to 15 additional store remodels beyond its previous guidance of 50. Capital expenditures guidance remained unchanged at $35 million to $40 million.
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#Citi Trends Ends Quarter Debt-Free With $56 Million in Cash
Citi Trends ended the quarter with 594 stores in 33 states, after opening four locations and closing one during the period, the company said.
The company completed 26 store remodels during the quarter, bringing its total to 51 remodels for the fiscal year to date.
Citi Trends held $55.9 million in cash at quarter-end, with no outstanding debt and no borrowings under its $75 million credit facility.
Merchandise inventory was $126.4 million at quarter-end, an increase of 7.5% from the prior-year quarter.
Comparable-store sales grew 9.7% for full fiscal 2025, when total sales increased 8.9% to $820 million, according to the company's investor materials.
Citi Trends said its forward-looking guidance is subject to risks including general economic conditions, tariff and trade policy changes, freight costs, inventory shrink, and shifts in consumer spending, among other factors described in its filings with the Securities and Exchange Commission.
Seipel said the company remains focused on consistent execution and disciplined growth, citing continued momentum in its merchandise strategy, the launch of its new Insiders Club customer relationship management platform, and its debt-free balance sheet. Forward-looking statements in the release remain subject to risks including consumer spending shifts, freight and tariff costs, and the company's ability to sustain comparable-store sales growth.