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May 03
Citi Trends Q1 2025 Earnings Report
Citi Trends returned to profitability with strong comparable sales growth and margin expansion.
Key Takeaways
Citi Trends delivered solid Q1 results, posting a 9.9% comp sales increase and a return to profitability with $0.9M in net income. Adjusted EBITDA was $5.4M, reversing a prior year loss, and the company raised its FY25 outlook.
Comparable store sales rose 9.9%, reflecting strong traffic and conversion.
Net income reached $0.9M, reversing a $3.4M loss in Q1 2024.
Gross margin expanded 90 bps to 39.6% due to better markup and lower shrink.
Adjusted EBITDA came in at $5.4M, exceeding expectations with 40% flowthrough.
Citi Trends
Citi Trends
Citi Trends Revenue by Geographic Location
Revenue by Geographic Location
United States Revenue
CapyFin.com Forward Guidance
Full-year outlook improved on stronger sales and margin expectations, with EBITDA guidance increased to $6–10M.
Positive Outlook
- Raised full-year comp store sales guidance to mid-single digits.
- Expecting gross margin to improve by 200 bps YoY.
- SG&A leverage forecast raised to 60–80 bps improvement.
- Full-year EBITDA outlook increased to $6–10M.
- Continued improvements in merchandising and supply chain driving results.
Challenges Ahead
- Gross margin outlook slightly below earlier guidance due to supply chain delays.
- Cautious macroeconomic environment cited, especially around tariffs.
- Still early in transformation efforts, limiting full realization of benefits.
- No earnings tax benefit expected, tax rate projected at 0%.
- Limited store expansion plans: only 5 new store openings.