• TJX Companies beat Wall Street's estimates and raised its full-year profitability guidance.
• The off-price giant, which owns TJ Maxx, Marshall's and Home Goods, said it was seeing a "strong start" to the holiday shopping season.
• TJX is still managing to grow sales even as it laps tougher comparisons from the year ago period.

TJX Companies touted a "strong start" to the holiday shopping season on Wednesday, but its shares slid after the fast-growing retailer offered guidance that appeared to underwhelm Wall Street.

TJX comfortably beat Wall Street's expectations during its fiscal third quarter, but it's expecting earnings per share for its holiday quarter to be between $1.12 and $1.14, behind expectations of $1.18, according to LSEG.

Here's how TJX performed compared with what Wall Street was anticipating, based on a survey of analysts by LSEG:

• Earnings per share: $1.14 vs. $1.09 expected
• Revenue: $14.06 billion vs. $13.95 billion expected

The company's reported net income for the three-month period that ended Nov. 2 was $1.30 billion, or $1.14 per share, compared with $1.19 billion or $1.03 per share, a year earlier. 

Sales rose to $14.06 billion, up about 6% from $13.27 billion a year earlier.

"Across the Company, customer transactions drove our comp sales increases, which tells us that our values and treasure hunt shopping experience are appealing to a wide range of customers," CEO Ernie Herrman said in a news release.

"The fourth quarter is off to a strong start, and we are excited about our opportunities for the holiday selling season. In stores and online, we are offering consumers an ever-changing and inspiring shopping destination for gifts at excellent values, and feel confident that there will be something for everyone when they shop us."

For its holiday quarter, TJX is expecting comparable sales to grow between 2% and 3%, largely in line with the 3% uptick that StreetAccount analysts had expected. In a news release, TJX said changes to its pretax profit margin and earnings guidance for its holiday quarter are "due to the expected reversal of the third quarter benefit from the timing of certain expenses." 

TJX is standing by its comparable sales guidance of 3% growth for the full year, just shy of the 3.2% growth that StreetAccount analysts had expected. It raised its pretax profit margin outlook from 11.2% to 11.3%, which matches StreetAccount's expectations, along with its earnings per share guidance. It's now expecting full-year earnings to be between $4.15 and $4.17, up from a prior range of $4.09 to $4.13. At the high end, its guidance is in line with the $4.17 that LSEG had expected.

Following a year of torrid growth, the discounter behind Marshalls, HomeGoods and T.J. Maxx is still increasing sales. It's winning over value-seeking consumers who are trading down from department stores like Macy's and Kohl's, and making strides with younger shoppers who don't see off-price shopping as a stigma.

Still, its growth is slowing, and TJX is looking abroad to boost sales. During the quarter, comparable sales at its Marmaxx division, which includes TJ Maxx, Marshall's and Sierra stores, were up 2%, compared to 7% in the year ago period. Comparable sales at HomeGoods were up 3%, compared to 9% a year ago, while TJX Canada grew 2%, compared to 3% last year.

The only division that outperformed last year's results was TJX International, which includes Europe and Australia. Earlier this year, TJX's European business struggled due to issues with its execution, but the division posted comparable sales growth of 7% during the quarter, compared to 1% a year ago.

Last quarter, it announced it was taking a 35% ownership stake in the Dubai-based retailer Brands for Less for $360 million. The privately held brand is the region's only major off-price player and operates more than 100 stores and an e-commerce business primarily in the United Arab Emirates and Saudi Arabia.

On Wednesday, TJX announced it is planning to enter Spain with its TK Maxx banner in early 2026.

Before the company reported, some analysts were concerned that TJX and other off-price retailers like Burlington Stores and Ross Stores could be disproportionately impacted by the unseasonably warm weather in October. Off-price retailers tend to be affected by unfavorable weather patterns more than traditional retailers because lower-income shoppers typically buy things when they need them -- not ahead of time, Bank of America analysts wrote in a research note.

During the fall months, retailers with heavy exposure to apparel, such as TJX, count on shoppers coming in to buy new coats and other gear for the cooler weather. If its lower income consumer held off on those purchases because the weather was warm, it could have dinged TJX's sales.

However, warmer than expected weather didn't appear to have a major effect on TJX's sales.