Five Below — Financial Results

Revenue Surged 23% as Shoppers Returned and New Stores Opened

After a rough fiscal 2024 when comparable sales (sales from stores open at least 15 months) fell 2.7%, Five Below bounced back strongly. Existing stores drew 7.1% more transactions and customers spent 5.3% more per visit on average. New store openings added another $415 million in sales on top of that recovery.

Profit Margins Improved as the Business Scaled

Gross margin (what's left of each sales dollar after merchandise and store costs) rose 1.1 percentage points, largely because store occupancy costs shrank as a share of a much larger revenue base. Net income jumped 41.4%, growing faster than sales — a sign the business is gaining operating leverage (meaning fixed costs are being spread across more revenue).

The Business Generated Strong, Growing Cash Flow

Operating cash flow — the cash the core business actually produces — rose $155.8 million year-over-year. Capital spending actually fell, meaning the gap between cash earned and cash spent on growth widened considerably. Five Below ended the year with no borrowings on its $225 million credit line, suggesting a healthy financial position heading into expansion.

Aggressive Store Expansion Continues Toward a 3,500-Store Vision

Five Below plans to open approximately 150 net new stores in fiscal 2026 at a budgeted cost of around $100 million, with another $130–150 million earmarked for remodels, relocations, and infrastructure. Management believes the U.S. can support more than 3,500 Five Below locations — nearly double today's 1,921. Each new store requires roughly $0.4 million in upfront investment and is expected to generate around $2 million in annual sales, with the investment typically paid back within one year.