The LSEG U.S. Retail and Restaurant Q1 earnings index, which tracks changes in the growth rate of earnings within the sector, is expected to show a 25.2% growth over last year’s levels. Our metrics show that only two of 10 consumer-related industries have turned negative (Exhibit 1).
Of the 188 retailers tracked by LSEG, the Broadline Retail sector is headed for the highest earnings growth rate in the first quarter, recording a 73.1% surge over last year’s level. The second-strongest sector is Leisure Products with a 39.3% growth estimate.
At the other end of the spectrum, Household Durables has the weakest anticipated Q1 2026 estimate, with profits expected to decline by -25.6% (Exhibit 1). To date, 136 of the 188 companies in our Retail/Restaurant Index have reported their EPS results for Q1 2026, representing 72% of the index.
Exhibit 1: The LSEG Retail Earnings Growth Rate – Q1 2026
Source: LSEG I/B/E/S
The strongest sector is the Broadline Retail group. Of the six companies in this group, four are on track to post positive estimated earnings growth for Q1. Etsy and Amazon reported the strongest earnings growth rates of 222.4%, and 33.3%, respectively. Similarly, Ollie’s Bargain Outlet is on track to report robust earnings growth rates of 16.9%.
The second strongest sector is the Leisure Products sector. Within this group, Callaway Golf posted the strongest earnings growth rate at 409.1%. In fact, of the seven companies in this category, three reported negative earnings growth for Q1. Hasbro is on track to report a robust 9.1% earnings growth rate, while Mattel delivered weak results, with negative earnings growth rate of -566.7%.
Meanwhile, the Household Durables group is on track to post the weakest year-over-year earnings comparisons. Negative growth expectations are directly responsible for the forecast decline in the overall earnings growth rate within the group. Twenty-three out of 27 companies struggled to match year-ago earnings growth levels. Newell Brands already reported a 400% decline in earnings, while Toll Brothers is on track to report 26.7% decline in earnings growth in the first quarter of 2026.
So far, 136 companies or 72.3% of those in our Retail/Restaurant Index, have reported earnings for Q1 2026. Of this group, 70% announced earnings that exceeded analysts’ expectations, 4% matched and the remaining 26% reported earnings that fell below analysts’ predictions (Exhibit 2). The blended earnings growth estimate for Q1 2026 is 25.2%.
To date, 136 companies in the Retail/Restaurant index have reported revenue for Q1 2026. For this group, the Q1 2026 blended revenue growth estimate is 6.9%; 67% have reported revenue above analyst expectations, and 33% reported revenue below analyst expectations.
Exhibit 2: LSEG Earnings Dashboard
Source: LSEG I/B/E/S
Guidance
To date, 136 retailers have reported Q1 2026 earnings, with many citing elevated prices, persistent macroeconomic challenges, and a more cautious consumer as key headwinds. Additionally, about half of these companies flagged growing pressure from tariffs and higher gas prices, both of which are squeezing consumers and supply chains simultaneously.
The bulk of retailers still have to report Q1 2026 results. Going into the quarter, there are more positive guidance than previous quarter; 25 retailers issued negative preannouncements, while 16 issued positive EPS guidance for Q1 2026 so far (Exhibit 3). Of those retailers offering revenue guidance, 30 warned of disappointing results, while 25 said revenue might be better than previously expected in Q1 2026.
Looking forward to Q2 2026; 12 retailers issued negative earnings preannouncements, while only five issued positive EPS guidance for Q2 2026. Of those retailers offering revenue guidance, sixteen warned of disappointing results, while five said revenue might be better than previously expected in Q2 2026.
Exhibit 3: Earnings and Revenue Guidance: Q1 2026 – Q2 2026
Source: LSEG I/B/E/S
Retail sales
The LSEG Same Store Sales (SSS) index is expected to see a robust 2.6% gain in Q1 2026 (Exhibit 4). An increase of 3.0% in SSS signals that consumer spending is healthy. Looking back one year, Q1 2025 SSS notched a gain of 5.0%, showing that retailers are facing difficult comparisons from a year ago.
Exhibit 4: LSEG Same Store Sales Index: 2023 – Present
Source: LSEG I/B/E/S
When it comes to apparel, retailers that offer shoppers a steady stream of novelty tend to cultivate strong customer loyalty. Aritzia in particular, already delivered the strongest same-store sales (SSS) result of the quarter at 27.7%, beating its 18.5% SSS estimate. Notably, seven of the top ten SSS performers this quarter are in the apparel category. Among the standouts, Tilly’s and American Eagle are expected to post SSS growth of 19.0% and 8.8%, respectively. Likewise, Ross Stores and Citi Trends are driving a projected 7.7% and 7.4% gains, respectively.
At the same time, consumers continue to feel the pressure of elevated food prices, sustaining demand for discount retailers. These value-driven stores remain resilient, holding steady business volumes despite challenging year-over-year comparisons. Walmart, known for its strong value proposition and loyal customer base, is expected to post a 3.6% SSS increase. Meanwhile, Costco is on track to report a robust 6.6% gain, despite facing tough comparisons from a year ago.
Exhibit 5: Strongest Same Store Sales Estimates: Q1 2026 Estimate vs. Q1 2025 Actual
Source: LSEG I/B/E/S
On the other hand, mall-based and big-box department stores continue to fall out of favor with consumers. Kohl’s is projected to report weak Q1 2026 same-store sales (SSS) decline of -1.7% (see Exhibit 6). Other underperformers such as J. Jill, Shoe Carnival, and Destination XL Group remain in the bottom tier as they grapple with ongoing company-specific challenges.
Exhibit 6: Weakest Same Store Sales Estimates: Q1 2026 Estimate vs. Q1 2025 Actual
Source: LSEG I/B/E/S
Restaurant Same Store Sales
The LSEG Restaurant Same Store Sales (SSS) index is expected to see a 2.5% growth in SSS in Q1 2026, on top of facing last year’s comparison of 0.5%. (Exhibit 7).
Within this industry, the Quick Service sector is on top with a 2.6% SSS estimate, stronger than the Casual Dining sector. The Casual Dining sector is on track to see a 2.2% SSS.
Exhibit 7: LSEG Restaurant Same Store Sales Index: 2023 – Present
Source: LSEG I/B/E/S
In the restaurant sector, approximately 61% of the companies in our same-store sales (SSS) index have reported or are on track to report positive Q1 2026 results. However, it’s important to note that many are benefiting from relatively easy year-over-year comparisons. On the weaker end, CBRL Group has one of the lowest estimates at -4.1%, while Red Robin Gourmet Burgers is expected to report a -2.2% decline. Wingstop, which faced a positive comparison from a year ago, has already reported a -8.7% comp, below its -5.9% estimate.
Exhibit 8: Weakest Restaurant Same Store Sales Estimates: Q1 2026 Estimate vs. Q1 2025 Actual
Source: LSEG I/B/E/S
On the positive side, there are notable standouts. Brinker International already reported a 3.3% SSS slightly below its 3.6% estimate and last year’s impressive 28.2% growth. Similarly, Texas Roadhouse and Shake Shack already beat their SSS estimates and delivered solid comps of 7.1% and 4.6%, respectively.
Exhibit 9: Strongest Restaurant Same Store Sales Estimates: Q1 2026 Estimate vs. Q1 2025 Actual
Source: LSEG I/B/E/S
