# TJX Companies, Inc. (NYSE: TJX) — Business, Risks and Management's Discussion

The TJX Companies, Inc. is a Delaware corporation headquartered in Framingham, Massachusetts. It
reports on a 52/53-week fiscal year ending on the Saturday nearest January 31. Fiscal 2026 was the
52-week year ended January 31, 2026; fiscal 2027 is the 52-week year ending January 30, 2027.

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## Business

*From the fiscal 2026 Form 10-K, accession 0000109198-26-000008 (Item 1, year ended January 31, 2026).*

TJX is the leading off-price apparel and home fashions retailer in the United States and worldwide.
At fiscal 2026 year-end it operated 5,214 stores and six branded e-commerce sites, selling a rapidly
changing assortment of quality, fashionable, brand-name and designer merchandise at prices generally
20% to 60% below full-price retailers' regular prices on comparable merchandise. The company does not
run promotional pricing such as sales or coupons; the value gap is intended to hold every day.

### Segments and banners

TJX reports four segments. Sierra is not a separate segment — its results sit inside Marmaxx.

- **Marmaxx (U.S.)** — TJ Maxx (1,348 stores) and Marshalls (1,255 stores), 2,603 stores in total,
  collectively the largest off-price retailer in the United States. TJ Maxx was founded in 1976;
  Marshalls was acquired in 1995. The two are differentiated by assortment: an expanded jewelry and
  accessories offer and a high-end designer department ("The Runway") at TJ Maxx; a full footwear line
  and broader men's offering at Marshalls. E-commerce: tjmaxx.com (2013) and marshalls.com (2019).
  **Sierra**, acquired in 2012 and rebranded from Sierra Trading Post in 2018, sells brand-name active
  and outdoor apparel, footwear and gear through 145 stores and sierra.com.
- **HomeGoods (U.S.)** — HomeGoods (963 stores, introduced 1992), the leading U.S. off-price home
  fashions retailer, plus Homesense (79 stores, launched in the U.S. in 2017), which carries a
  differentiated mix with expanded large furniture, ceiling lighting, rugs and an entertaining
  marketplace. 1,042 stores in total.
- **TJX Canada** — Winners (316 stores, acquired 1990), HomeSense (162 stores, introduced 2001) and
  Marshalls Canada (111 stores, launched 2011); 589 stores in total.
- **TJX International** — TK Maxx in Europe (673 stores; U.K., Ireland, Germany, Poland, Austria, the
  Netherlands, and, starting in March 2026, Spain), Homesense in Europe (74 stores in the U.K. and
  Ireland) and TK Maxx in Australia (88 stores, entered via the 2015 Trade Secret acquisition,
  rebranded in 2017). 835 stores in total. European e-commerce runs through tkmaxx.com (2009) and
  tkmaxx.de and tkmaxx.at (both 2023).

TJX also holds two equity-method investments: a stake in Multibrand Outlet Stores S.A.P.I. de C.V.
("MOS"), a joint venture with Grupo Axo covering Axo's off-price physical store business in Mexico
(Promoda, Reduced and Urban Store banners), with an option to increase ownership over the long term;
and a non-controlling minority position in privately held Brands for Less ("BFL"), the only major
off-price branded apparel, toys and home fashions retailer in the Middle East, operating primarily in
the UAE and Saudi Arabia. Both are reported on a one-quarter lag within SG&A and were not material to
first-half fiscal 2027 or fiscal 2026 results.

### How the model makes money

**Opportunistic buying.** A buying organization of more than 1,400 Associates, working from offices
across the globe, buys from a universe of approximately 21,000 vendors in more than 100 countries.
Merchandise comes from closeouts, special production direct from brands and factories, order
cancellations and manufacturer overruns. Much of it is bought for the current or immediately upcoming
season — close to need, when trend and price visibility is highest — with some bought and stored as
"packaway" for future seasons. TJX buys less-than-full assortments and quantities from small to very
large, pays promptly, and does not ask for the advertising, promotional, markdown or delivery
concessions or return privileges that conventional retailers require. That posture, plus an excellent
credit rating, is what makes TJX an attractive clearing channel for vendors. In-house and licensed
brands are a small percentage of the mix.

**Inventory management.** Lean inventory and rapid turns are the point, not a by-product. Pricing,
markdown and store-inventory decisions are made centrally using specialized systems; selling floors are
largely free of walls and permanent fixtures so departments can expand and contract with what the
buyers actually bought. Distribution centers encompass approximately 31 million square feet across six
countries.

**Low-cost operations.** Advertising promotes banners rather than individual products, keeping ad spend
low as a percentage of sales; store fixturing is deliberately inexpensive. TJX offers TJX-branded credit
cards in the U.S. through a bank but does not own the customer receivables.

**People and property.** Approximately 377,000 Associates as of January 31, 2026, many working fewer
than 40 hours a week; roughly 86% work in stores. Thousands of temporary employees are hired each year
for back-to-school and holiday. Many distribution-network Associates in the U.S. and Canada are covered
by collective bargaining agreements, and other Associates are members of works councils in Europe. TJX
leases virtually all store locations, typically on ten-year initial terms with five-year extension
options in the U.S. and Canada, ten-to-fifteen-year initial terms in Europe and ten years in Australia.

**Seasonality.** Sales and income are weighted to the second half of the year, which contains
back-to-school and the year-end holiday season.

**Store growth potential.** The fiscal 2026 10-K put long-term potential in existing geographies at
approximately 7,000 stores (3,000 Marmaxx, 1,800 HomeGoods, 325 Sierra, 650 TJX Canada, 1,225 TJX
International including the Spain entry). That target has since been raised — see *Current quarter*.

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## Risk factors

*From the fiscal 2026 Form 10-K, accession 0000109198-26-000008 (Item 1A), condensed to the substantive risks.*

### Operational and strategic

- **The buying model is the business, and it depends on judgment.** Opportunistic buying places
  considerable discretion with merchants who must react to fast-changing market opportunities. If
  merchandise is not bought at prices sufficiently below what conventional retailers pay, the value gap
  narrows. If sales forecasts miss, TJX either carries excess inventory requiring markdowns or runs
  short of goods customers want. Both outcomes hit margin directly. External shocks — store closures,
  inflation, supply chain disruption — have interfered with this in the past.
- **Consumer trends and channel expectations.** Success depends on reading trends across a wide
  merchandise range and many markets. Changes to store layout, loss-prevention or digital security
  protocols can themselves depress the shopping experience and transaction counts.
- **Competition.** The apparel and home fashion businesses are highly competitive against local,
  regional, national and international retailers across stores, e-commerce and omnichannel. Some
  competitors are larger and better resourced. TJX flags the possibility of falling behind on
  integration of rapidly evolving technologies including artificial intelligence, and notes that
  consumer e-commerce spending continues to grow while its own business is primarily brick-and-mortar.
- **Growth execution.** Expansion by development, investment or acquisition adds complexity: real estate
  on attractive terms, new-store productivity, information sharing, compliance and risk management,
  staffing and training in unfamiliar labor markets. TJX has closed stores and divested businesses for
  performance reasons before and may again.
- **Scale.** Multiple banners across the U.S., Canada, Europe and Australia, with meaningful banner
  autonomy, raise the risk that systems, controls and policies are not implemented consistently.
- **Global sourcing and international transport.** Much merchandise is sourced from locations other than
  where it is sold, particularly China, India and southeastern Asia. Where TJX is importer of record it
  may carry manufacturer-like regulatory obligations. An increasing number of supply chain reporting and
  mitigation regulations raise operating costs and affect where and what TJX sources.
- **Cybersecurity and IT.** TJX depends on IT systems it and third parties operate for planning,
  purchasing, point-of-sale and e-commerce, supply chain, logistics, inventory, HR and financial
  management. Attack methods cited include malware, ransomware, phishing, vishing, deepfakes, social
  engineering, denial-of-service, exploitation of vulnerabilities, insider or third-party malfeasance,
  payment-card skimmers and account takeovers, increasingly sophisticated through the use of artificial
  intelligence. TJX states that the unauthorized network intrusion discovered late in 2006 remains the
  only cybersecurity incident to date material to its results. Controls vary in maturity across the
  business and logging may be insufficient to fully determine root cause of every event.
- **Labor costs and workforce.** Operating expenses are expected to keep reflecting rising labor costs,
  driven by minimum wage and benefit mandates, competition for labor, inflation, unionization and
  collective bargaining dynamics, and the cost of retirement and health benefits. TJX carries
  multiemployer plan exposure including underfunding, withdrawal liability and increased contribution
  requirements. U.S. store Associates, the largest part of the workforce, are not covered by collective
  bargaining agreements and may become unionized.
- **Talent.** High turnover in entry-level and part-time roles requires constant recruiting, and the
  distinctive off-price model requires significant internal training and development, particularly in
  the buying organization, where succession failures would impair execution.
- **Reputation.** Damage can arise from company policies and practices, executives and senior leadership
  transitions, sourcing, third-party providers and vendors, the merchandise itself, investments, regions
  of operation, marketing partners and influencers, product recalls, and workplace safety, harassment or
  labor incidents — and can spread through social media even where the information is inaccurate.
- **Compliance, governance and public disclosure expectations,** including environmental sustainability,
  human capital management, social compliance and governance. Stakeholder expectations are inconsistent
  and TJX may be judged as overreaching by some and inadequate by others.
- **International expansion,** including Foreign Corrupt Practices Act and U.K. Bribery Act compliance,
  currency exposure, repatriation limits, adverse tax consequences, trade regulation, and political,
  economic and civil instability.
- **Market expectations.** Quarterly results have fluctuated significantly in the past. Suspending the
  buyback (as TJX has done before) or repurchasing fewer shares than planned would hurt EPS; reducing or
  suspending the dividend (as was done for part of fiscal 2021) could hurt the stock price.
- **Shrink and asset loss,** from error or misconduct by Associates, customers, vendors or third parties
  including organized retail crime, amplified by the enforcement environment and higher store inventory.
  This has adversely affected financial performance in the past.
- **Dependence on operating cash flow** to fund operations, growth, buybacks, dividends, interest and
  debt repayment, including the ability to repatriate foreign cash cost-effectively.
- **M&A, investments and divestitures,** with named precedents: the fiscal 2025 Middle East minority
  investment and Mexico joint venture, the internally developed Homesense concept, the tkmaxx.de and
  tkmaxx.at launches, and the fiscal 2023 divestiture of a minority interest in a Russian off-price
  retailer in which TJX did not recover the full value of its investment. Goodwill and tradename
  impairment is the specific balance-sheet risk flagged.
- **Real estate leases,** which generally obligate TJX for long periods; obligations continue after a
  store closes, assigned or subleased space can leave TJX contingently or primarily liable, and renewal
  terms may not be available on commercially reasonable terms.

### External and economic

- **Consumer confidence and discretionary spending,** sensitive to inflation and deflation, declines in
  purchasing power, recession, unemployment, healthcare and commodity costs, interest and tax rates,
  housing weakness, and capital-market volatility and credit availability.
- **Trade policy and tariffs.** The 10-K describes the February 2026 U.S. Supreme Court decision
  invalidating tariffs imposed under the International Emergency Economic Powers Act ("IEEPA"), which
  may allow recovery of amounts previously paid, with timing and administration unknown, and notes that
  following the ruling an executive order was issued imposing a new global tariff in addition to
  existing non-IEEPA tariffs. Outcomes depend on U.S. policy changes, bilateral negotiations, responses
  of other countries, exemptions, alternative sourcing cost, and the buying organization's ability to
  offset the effect. Adapting to trade restrictions could force pricing changes that damage TJX's
  standing as a value retailer.
- **Liquidity and cost of capital,** including the effect of market disruption on financing costs and
  covenant compliance, and the effect of economic conditions on pension plan asset values, liabilities
  and funding requirements.
- **Severe weather, catastrophic events and public health crises,** including climate conditions that
  have continued to increase in severity and frequency, and conflict and shipping disruption in the Red
  Sea and surrounding waterways.

### Market risk (Item 7A)

Currency exposure is primarily to the Canadian dollar, British pound and Euro, hedged with forward and
swap contracts entered only against underlying economic exposure. A hypothetical 10% movement in the
translation of foreign operations was estimated to affect pre-tax income by approximately $132 million
in fiscal 2026, versus approximately $112 million in fiscal 2025. Pension assets, partly equity
securities, are exposed to market declines that would increase required contributions.

---

## Management's discussion — fiscal 2026 (year ended January 31, 2026)

*From the fiscal 2026 Form 10-K, accession 0000109198-26-000008 (Item 7).*

### Consolidated results

Net sales rose 7% to $60.4 billion from $56.4 billion in fiscal 2025, comprising a 5% comp sales
increase, a 2% contribution from non-comp sales and a neutral currency impact. Comp sales were driven by
a higher average basket and an increase in customer transactions, with home and apparel comps both
generally in line with the overall increase. Store count and selling square footage each rose
approximately 3%. E-commerce was approximately 2% of total sales, unchanged year over year.

Pre-tax profit margin was 12.1%, up 0.6 percentage points from 11.5%. The cost of sales ratio (including
buying and occupancy) improved 0.4 points to 69.0% on favorable merchandise margin — lower freight costs
and lower inventory shrink expense — and expense leverage on higher comps. The SG&A ratio improved 0.3
points to 19.1%, driven by the net benefit of the credit card interchange fee litigation settlement and
related expenses. The effective tax rate was 24.7% versus 25.0%, the decrease primarily from a benefit
on acquisition of federal tax credits. Net income was $5.5 billion versus $4.9 billion; diluted EPS was
$4.87 versus $4.26. Currency was a $0.01 negative on fiscal 2026 diluted EPS against a $0.01 positive in
fiscal 2025.

**Credit card interchange fee settlement.** In the fourth quarter of fiscal 2026 TJX, as plaintiff,
settled litigation relating to credit card interchange fees. The settlement produced a gain of $419
million net of $51 million of legal expenses, recognized within SG&A. Against it, TJX incurred $116
million of incremental global incentive compensation expense and $82 million for a discretionary bonus
for eligible non-bonus-plan Associates. The net effect was a $0.14 benefit to fiscal 2026 diluted EPS.
The gain benefited the U.S. segments' profit while the related expenses hit every segment. The cash was
received in the quarter ended May 2, 2026.

### Segment results, fiscal 2026

| Segment | Net sales | Growth | Segment profit margin | Prior year |
|---|---|---|---|---|
| Marmaxx | $36.6bn | +6% (comp +4%, non-comp +2%) | 15.1% | 14.1% |
| HomeGoods | $10.2bn | +8% (comp +5%, non-comp +3%) | 12.2% | 10.9% |
| TJX Canada | $5.6bn | +8% (comp +7%, non-comp +2%, FX −1%) | 13.4% | 13.5% |
| TJX International | $8.0bn | +11% (FX +5%, comp +4%, non-comp +2%) | 7.0% | 5.9% |

Marmaxx margin gain came from the interchange settlement net benefit and favorable merchandise margin
(lower shrink and freight, partly offset by higher markdowns), with comp growth strongest in the South.
HomeGoods gained on merchandise margin, comp leverage, lower supply chain and store costs and the
settlement, with strength in the West, South and Midwest. TJX Canada's small margin decline came from
settlement-related expenses and lower merchandise margin — higher markon more than offset by adverse
transactional foreign exchange on cost of merchandise — mostly offset by comp leverage. TJX
International gained on higher merchandise margin from higher markon, favorable store occupancy and
lower administrative costs, partly offset by settlement-related expenses. General corporate expense rose
on higher administrative costs, unfavorable year-over-year mark-to-market on inventory hedges,
settlement-related expenses and charitable foundation contributions.

Fiscal 2027 opening plans stated in the 10-K: 45 net new Marmaxx stores and 24 Sierra stores (about +2%
selling square footage); 24 HomeGoods and 11 Homesense stores (+4%); 13 in Canada (+3%); 19 net new in
Europe and 10 in Australia (+3%).

### Financial condition, fiscal 2026

Operating activities generated $6.9 billion, up $758 million from $6.1 billion, primarily on higher net
income and higher accrued incentive compensation, partly offset by higher merchandise inventories net of
accounts payable. Investing outflows were $2.0 billion (fiscal 2025: $2.5 billion), driven by capital
expenditure; fiscal 2025 also included the Grupo Axo joint venture and BFL minority investment
purchases. Financing outflows were $4.1 billion (fiscal 2025: $3.8 billion), primarily buybacks and
dividends. TJX repurchased and retired 18.5 million shares for $2.5 billion in fiscal 2026 (22.3 million
shares for $2.5 billion in fiscal 2025). Dividends declared totaled $1.70 per share versus $1.50, with
$1.8 billion paid in cash. Cash at year-end was $6.2 billion, of which approximately $2 billion was held
by foreign subsidiaries and $1.5 billion in countries where undistributed earnings are indefinitely
reinvested. There were no short-term bank borrowings or commercial paper outstanding, and $1.5 billion
was available under the credit facilities. Long-term liabilities not reasonably predictable as to timing
included $835 million for employee compensation and benefits and $229 million for uncertain tax
positions; roughly 180 leases were signed but not yet commenced.

Critical accounting estimates are inventory valuation (retail method, used for all businesses except TK
Maxx Australia, requiring markdown and shrinkage estimates, with a full physical inventory taken near
year-end), reserves for uncertain tax positions, and loss contingencies.

---

## Current quarter — Q2 fiscal 2027 (thirteen weeks ended August 1, 2026)

*From the Form 10-Q for the quarter ended August 1, 2026, accession 0000109198-26-000048, and the
results release furnished with the Form 8-K of August 19, 2026, accession 0000109198-26-000045.*

### Headline

Net sales rose 5% to $15.2 billion from $14.4 billion, reflecting a 4% comp sales increase and a 2%
non-comp contribution, partly offset by a 1% negative currency impact. Comp sales were driven by a
higher average basket and an increase in customer transactions, and home comp growth outperformed
apparel. Pre-tax profit margin was 13.3%, up 1.9 percentage points from 11.4%. Diluted EPS was $1.36
versus $1.10. Net income was $1.5 billion. E-commerce remained approximately 2% of total sales.

For the twenty-six weeks, net sales rose 7% to $29.5 billion from $27.5 billion (comp +5%, non-comp +2%,
currency neutral), and diluted EPS was $2.55 versus $2.02.

### The tariff item — read this before reading the margin

Most of the quarter's margin expansion is not an operating result. In February 2026 the U.S. Supreme Court
invalidated tariffs imposed under the International Emergency Economic Powers Act. TJX estimates it had
paid approximately **$490 million** in IEEPA-related tariffs in aggregate. U.S. Customs and Border
Protection established a phased administrative process for refund claims, and during the second quarter
TJX received **$331 million** of refunds eligible under phases 1 and 2 of that process, including an
immaterial amount of interest, recognized within cost of sales. Because of the refunds, TJX accrued
**$112 million** of incremental year-end incentive compensation and discretionary bonuses for eligible
Associates globally, charged across both cost of sales and SG&A. The **net benefit was $219 million**,
worth 1.4 percentage points of pre-tax margin and $0.14 of diluted EPS.

Three qualifications matter:

1. **No receivable has been recorded for anything further.** As of August 1, 2026 TJX had not recorded a
   receivable for additional potential refunds and will only recognize one if the right to receive
   becomes realized or realizable under ASC 450.
2. **The remaining recovery is not assured.** The Supreme Court has ruled, so the entitlement question is
   not itself awaiting a trial outcome; what remains open is administrative. TJX states that the amount
   of refunds may not equal the full amount of IEEPA tariffs paid, and that any refunds remain subject
   to further legal, regulatory or administrative developments, which it continues to monitor.
3. **The tariff environment did not become cheaper.** Following the ruling, an executive order imposed a
   new global tariff in addition to existing non-IEEPA tariffs. TJX describes the extent and duration of
   tariffs — and any additional IEEPA refunds — as continuing to be uncertain, with uncertainty
   remaining over direct and indirect imports, vendor and competitor pricing, consumer demand, tariff
   pass-throughs and retaliatory tariffs.

Excluding the net tariff benefit, the release reported adjusted second-quarter pre-tax profit margin of
11.9% (up 0.5 points), adjusted gross margin of 31.4% (up 0.7 points, driven by merchandise margin),
adjusted SG&A of 19.7% of sales (up 0.2 points on store wage and payroll costs), and adjusted diluted
EPS of $1.22, up 11%.

### Margin bridge

The cost of sales ratio, including buying and occupancy, was 66.6%, down 2.7 percentage points from
69.3%, driven by the net tariff refund benefit and favorable merchandise margin from higher markon. For
the six months the ratio was 67.6% versus 69.9%, helped additionally by favorable year-over-year
mark-to-market on inventory and fuel hedges and expense leverage on higher comps. The SG&A ratio rose
0.8 points to 20.3% (six months: 19.9% versus 19.5%), driven by the tariff-related incremental
compensation accruals and by incremental store wage and payroll costs. Net interest income increased on
a higher average cash balance, partly offset by lower prevailing rates. The effective tax rate was 24.7%
versus 24.5% in the quarter and 23.7% versus 23.9% for the six months, the six-month decrease reflecting
higher federal tax credit acquisition benefits and higher excess tax benefit from share-based
compensation, partly offset by fewer audit settlement benefits. The One Big Beautiful Bill Act signed
July 4, 2025 has not materially affected the tax provision and is not expected to for fiscal 2027.
Currency added $0.01 to quarterly diluted EPS and $0.02 for the six months.

### Segments

| Segment (Q2 FY27) | Net sales | Growth | Comp | Segment profit | Margin | Prior-year margin |
|---|---|---|---|---|---|---|
| Marmaxx | $9,109m | +3% | +1% | $1,424m | 15.6% | 14.2% |
| HomeGoods | $2,507m | +10% | +7% | $441m | 17.6% | 10.0% |
| TJX Canada | $1,470m | +6% | +6% | $229m | 15.6% | 16.0% |
| TJX International | $2,094m | +11% | +7% | $135m | 6.4% | 5.2% |
| **Total** | **$15,180m** | **+5%** | **+4%** | **$2,229m** | | |

General corporate expense was $242 million versus $182 million; income before income taxes was $2,018
million versus $1,647 million.

**Marmaxx is the soft spot.** Its 1% comp was the weakest in the group and the sales increase came
mostly from non-comp (new store) sales. Comp growth came from a higher average basket *partially offset
by a decrease in customer transactions* — the only segment where transactions fell. Apparel and home
performed in line with each other, and no region stood out. Reported segment margin rose to 15.6% on the
tariff refund benefit and higher markon, partly offset by expense deleverage on lower comps and
incremental store wage and payroll costs; the release put the tariff benefit at 1.4 points of that
margin, implying an adjusted 14.2% — flat with the prior year.

**HomeGoods was the standout,** with a 7% comp on a higher average basket plus transaction growth and
strong comps in all regions. Reported margin of 17.6% includes a 5.2 point tariff benefit; adjusted
margin was 12.4% against 10.0% reported a year earlier, helped by merchandise margin (favorable markon
and lower freight, partly offset by higher markdowns), lower supply chain and store costs and comp
leverage.

**TJX Canada** grew 6% with a 6% comp despite a 2-point currency drag. Its margin fell because it bears
the tariff-related compensation accrual (0.7 points) without receiving refund benefit — the refunds
accrue to the U.S. segments — plus additional payroll costs, partly offset by comp leverage and higher
markon from favorable transactional foreign exchange. Adjusted margin was 16.3% versus 16.0%.

**TJX International** grew 11% on a 7% comp with a 1-point currency tailwind, on favorable merchandise
margin and comp leverage, less the 0.9-point compensation accrual; adjusted margin was 7.3%.

### Liquidity, capital and store base

TJX generated $2.2 billion of operating cash flow in the quarter — the company's own second-quarter
figure, given in the August 19, 2026 results release, not in the 10-Q — and ended the quarter with $6.0
billion of cash. For the twenty-six weeks — the only period for which the 10-Q presents a cash flow statement — operating
activities produced $3.3 billion versus $2.2 billion a year earlier, an increase of $1.1 billion
attributed to higher net income including the tariff refunds and a decrease in prepaid expenses and other
current assets related to receipt of the interchange fee settlement. Six-month investing outflows were
$1.2 billion versus $969 million, driven by capital expenditure; full-year fiscal 2027 capital spending
is expected to be approximately $2.2 billion to $2.3 billion. Six-month financing outflows were $2.4
billion versus $2.0 billion.

Foreign subsidiaries held $1.6 billion of the cash, of which approximately $730 million is working
capital considered indefinitely reinvested; cash generated from earnings in certain foreign subsidiaries
in fiscal 2027 is not considered indefinitely reinvested, and TJX does not expect additional tax expense
on repatriation. There were no short-term borrowings or commercial paper outstanding, and $1.5 billion
remained available under the two revolving credit facilities ($750 million maturing May 2029 and $750
million maturing May 2030), with no amounts drawn and full covenant compliance. Total inventories were
$7.9 billion versus $7.4 billion, with per-store inventory up 2% reported and 3% in constant currency.

The company returned $1.3 billion to shareholders in the quarter — 5.1 million shares repurchased and
retired for $798 million plus $529 million of dividends — and $2.4 billion over the six months (8.9
million shares for $1.4 billion, plus $1.0 billion of dividends). The previously announced repurchase
program was completed during the quarter, and approximately $2.7 billion remained available under the
program authorized in February 2026. Quarterly dividends declared were $0.48 per share versus $0.425.

Store count rose 23 during the quarter to 5,285, with gross square footage up 0.4% sequentially to 137.9
million; against the prior-year quarter both store count and selling square footage were up approximately
3%. TJX raised its long-term global store target to 7,500 stores, adding 300 to the Marmaxx target and
200 to HomeGoods.

### Outlook

For the third quarter of fiscal 2027 the company plans consolidated comp sales up 2% to 3%, pre-tax
profit margin of 12.8% to 12.9% (12.3% to 12.4% excluding an expected 0.5-point net tariff refund
benefit), and diluted EPS of $1.36 to $1.38 ($1.30 to $1.32 excluding an expected $0.06 net tariff
benefit). It expects to receive additional IEEPA refunds in the third quarter, benefiting cost of sales,
and to accrue further incremental year-end incentive and discretionary bonus expense as a result — while
stating that the amount, timing and likelihood of additional recovery remain uncertain. Full-year
consolidated comp sales guidance is unchanged at up 3% to 4%; the full-year pre-tax profit margin and
EPS outlooks were raised, to a pre-tax profit margin of 12.3% to 12.4% (12.0% to 12.1% excluding an
expected 0.3-point net tariff refund benefit) and diluted EPS of $5.31 to $5.36 ($5.15 to $5.20
excluding an expected $0.16 net tariff benefit). Management described the third quarter as off to a
strong start with improvement at Marmaxx, and characterized
availability of branded merchandise as outstanding. Beginning in fiscal 2028 TJX plans to accelerate
store opening growth to 4%.

---

## Subsequent events

The Form 10-Q for the quarter ended August 1, 2026 (accession 0000109198-26-000048) does not include a
subsequent events note, and its Note K on contingent obligations, contingencies and commitments
discloses no post-period acquisition, divestiture, financing or litigation outcome. The following are
the post-period items disclosed elsewhere in that filing and in the results release furnished with the
Form 8-K of August 19, 2026 (accession 0000109198-26-000045):

- **Debt maturity.** TJX intends to repay the $1 billion of 2.250% ten-year Notes due September 2026 at
  maturity during the third quarter of fiscal 2027, using operating cash flow. The notes are already
  classified in current maturities of long-term debt at August 1, 2026.
- **Additional IEEPA tariff refunds expected in Q3 fiscal 2027,** with a corresponding incremental
  compensation accrual — see *Outlook* above.
- **Guidance raised and store growth accelerated**, announced August 19, 2026 — see *Outlook* above.

For completeness, the fiscal 2026 Form 10-K (accession 0000109198-26-000008) carried a single subsequent
event note, covering the February 20, 2026 U.S. Supreme Court decision invalidating IEEPA tariffs, which
TJX was then evaluating. That matter has since become the tariff refund item described above.

*No acquisition or divestiture is disclosed in either the latest Form 10-Q or the latest Form 10-K as
occurring after the respective period ends.*