Key takeaways:
- Aritzia’s U.S. net revenue increased 54% year-over-year to $638.1 million in Q1 fiscal 2027, driven by new boutique openings and strong comparable sales growth across existing locations.
- Canadian revenue climbed 25% to $312.9 million, reflecting continued digital momentum and strong product performance in a more established market.
- Gross profit margin expanded 310 basis points to 50.3%, while adjusted EBITDA margin reached 20.1%, marking nine consecutive quarters of sustained margin expansion.
- The company raised its full-year fiscal 2027 revenue forecast to $4.55 billion to $4.75 billion, up from its previous outlook of $4.4 billion to $4.6 billion.
Aritzia reported a 43% jump in total net revenue to $951 million for the first quarter of fiscal 2027, ended May 31, 2026, as the Canadian “everyday luxury” apparel retailer continued its push into the U.S. market and posted a record adjusted EBITDA margin of 20.1%.
Comparable sales grew 35% in the quarter, with every geography and channel posting double-digit gains. CEO Jennifer Wong called it a strong start to the fiscal year.
“Our momentum was broad-based across the business, spanning all geographies, channels and categories,” Wong said on the company’s earnings call on Thursday.
U.S. Store Expansion
The United States remained Aritzia’s primary growth engine. U.S. net revenue represented 67.1% of total net revenue for the quarter.
The company attributed that performance to a combination of new boutique openings, strong comparable sales in existing stores and accelerating digital demand. Over the past 12 months, Aritzia opened 16 new and repositioned boutiques in the U.S., resulting in approximately 25% square footage growth in that market.
Aritzia currently operates 143 boutiques across North America, up from 131 at the end of Q1 fiscal 2026. For the full fiscal year, the company plans to open 12 to 13 new boutiques and complete four to five repositions, with 11 to 12 new locations and two to three repositions expected in the United States. That leaves 76 U.S. boutiques currently open, against what the company says is an identified opportunity for more than 180 locations that meet its site criteria.
In the second quarter, Aritzia plans to open three new U.S. boutiques, each in markets where the brand hasn’t previously operated: Birmingham, New Orleans and St. Louis.
New stores are tracking to pay back their capital investment in less than a year, outperforming the company’s stated target of 12 to 18 months.
Bigger Stores, Same Productivity
Aritzia has steadily increased its average boutique size over the years, moving from roughly 6,000 square feet a decade ago to 8,000 square feet a few years later and now targeting 10,000 square feet or more for new locations.
Wong said the economics of the larger format are holding up. “The larger format stores, specifically the sales per square foot are in line with our highly productive smaller boutiques,” she said on the earnings call. “We’re extremely pleased with how this strategy has evolved.”
The company said its new boutiques generate roughly $10 million in annual revenue at approximately $1,000 in sales per square foot, based on a 10,000-square-foot footprint with a net investment of about $4 million.
Digital Net Revenue Grows 55%
Behind Aritzia’s growth is a brand philosophy the company calls “everyday luxury,” a positioning that sits between mass-market retail and luxury. Style advisors are trained to offer the kind of individualized service more common at luxury flagships. The same experience is mirrored online and through Aritzia’s mobile app.
Digital net revenue rose 55.5% to $284.7 million in the quarter, with the company’s mobile app emerging as a meaningful contributor. Chief Financial Officer Todd Ingledew said the app is accounting for approximately 30% of digital transactions, has surpassed two million downloads and is driving repeat purchasing behavior.
“We’re seeing clients browse and shop the app multiple times a week,” Wong said. Ingledew quantified the app’s contribution, noting it added high single-digit percentage growth to the digital business in Q1 and is included in guidance going forward.
The company also reported that international ecommerce sales grew nearly 170% year-over-year, following investments in its international shopping experience. A small marketing pilot launched in May in two countries showed strong initial traffic and conversion results, though Aritzia described it as early-stage and cautioned against reading too much into it yet.
Canada’s Continued Strength
Canadian net revenue rose 25% to $312.9 million, a notable result given that Canada is a more mature market for Aritzia. The company said the gain was driven by comparable sales growth in both digital and its existing boutique network, along with strong product demand.
During the earnings call, Wong pointed to the recently reopened Oak Ridge boutique in Vancouver as a reflection of the brand’s roots and its evolution. The original 1,500-square-foot location, where Aritzia opened its first standalone store in 1984, has been reimagined as a 10,000-square-foot space.
“Our performance continues to be strong, and it has been trending strong the last several quarters,” Wong said regarding whether Canada could sustain its growth rates. “We’re not seeing anything in our data that indicates a trend otherwise right now.”
The company said it sees broad appeal across three generations of customers in Canada, with younger shoppers entering its target demographic while existing loyal clients continue to shop across different life stages.
Margin Expansion and Profit Growth
Aritzia’s gross profit margin expanded 310 basis points to 50.3%, a record for the company. The improvement was driven by initial markup gains, lower markdowns and leverage on store occupancy and other fixed costs. That performance came despite 190 basis points of pressure from tariffs and the suspension of the de minimis exemption.
Adjusted EBITDA rose 80.5% to $191.6 million, with the adjusted EBITDA margin expanding 410 basis points to 20.1%, up from 16% in Q1 fiscal 2026. The result marked nine consecutive quarters of sustained margin expansion, a streak that Wong described as “structural” rather than temporary.
Net income increased 176.6% to $117.3 million, or $0.99 per diluted share, compared with $42.4 million in the prior-year quarter. Adjusted net income per diluted share rose 95.9% to $0.96, up from $0.49 in Q1 fiscal 2026.
Updated Guidance
The company’s fiscal 2027 guidance assumes tariffs remain at 10% for the remainder of the year. Ingledew noted that if tariffs rise to 20% at the end of July, the additional pressure in the second half of the year would be approximately $25 million to $30 million. He also clarified that the guidance doesn’t include any benefit from potential tariff refunds, which could offset some of that incremental pressure.
Aritzia raised its full-year fiscal 2027 net revenue forecast to $4.55 billion to $4.75 billion, representing growth of 23% to 28% from fiscal 2026. The company also raised its adjusted EBITDA margin outlook to approximately 19.5%, up from a prior target of approximately 19%.
For Q2 fiscal 2027, the company is forecasting net revenue of $1.1 billion to $1.125 billion, representing growth of 35% to 39% year over year, with comparable sales growth in the high 20s.
