Tractor Supply Company (NASDAQ:TSCO) shares dropped sharply on Thursday after the retailer reported fourth-quarter results that came in below market expectations, pointing to softer consumer spending on discretionary items.
The stock was down 5.69% in pre-market trading following the update.
Tractor Supply posted fourth-quarter earnings of $0.43 per share, missing analysts’ forecasts of $0.47. Revenue increased 3.3% year on year to $3.90 billion but also fell short of the $4.02 billion consensus estimate. Comparable store sales edged up just 0.3%, as solid demand for essential products was offset by weaker discretionary spending.
“Our fourth quarter results came in below our expectations and reflected a shift in consumer spending, with essential categories remaining resilient while discretionary demand moderated,” said Hal Lawton, President and CEO of Tractor Supply.
For fiscal 2025, the company reported net sales growth of 4.3% to $15.52 billion, with comparable store sales up 1.2% year over year. Looking ahead, Tractor Supply’s fiscal 2026 guidance calls for earnings per share of $2.13 to $2.23, below the analyst consensus of $2.30, alongside expected net sales growth of 4% to 6%.
Gross margin in the quarter slipped slightly to 35.1% from 35.2% a year earlier, as cost controls were outweighed by higher tariffs, increased promotional activity, and rising transportation costs linked to deliveries. Operating income declined 6.5% to $297.7 million.
During the quarter, Tractor Supply opened 31 new stores and returned $238.9 million to shareholders through dividends and share buybacks. The company plans to open around 100 new locations in 2026, while continuing store remodels and expanding its distribution center network.