C$97 Million of Tariff Refunds Sit Inside Aritzia's Record Margin

Aritzia reported its second quarter results after the close on 8 October 2026. The shares rose 20.5 per cent the following session.

The quarter covered the 13 weeks ended 30 August 2026. Net revenue was C$1.17 billion, up 44.1 per cent, or 42.1 per cent in constant currency. Comparable sales, which count only stores and channels open in both periods, rose 34.5 per cent. Jennifer Wong, Chief Executive Officer, said the results demonstrate the earnings power of the business model.

The quarter was large before any refund arrived

Growth of this size at a C$4.8 billion revenue company is unusual. The detail underneath it is where the quarter is judged.

Retail revenue was C$766.9 million, up 34.1 per cent. Digital revenue was C$402.9 million, up 67.7 per cent. Digital is now 34.4 per cent of the total.

The geography moved further. United States revenue was C$779.4 million, up 60.3 per cent. That is 66.6 per cent of net revenue. Canadian revenue was C$390.4 million, up 19.8 per cent.

Selling, general and administrative expense fell to 29.5 per cent of net revenue. That is 130 basis points lower than a year earlier. A basis point is one hundredth of a percentage point.

Aritzia ended the quarter with 146 boutiques, against 134 a year earlier. It plans 12 to 13 new boutiques and four to five repositions in fiscal 2027.

Comparable sales are the number that cannot be bought

A retailer can lift revenue by opening stores. Comparable sales test whether the existing ones are busier.

The measure counts only boutiques and channels that were trading in both periods. New openings are excluded until they have a full year behind them. Aritzia's comparable sales rose 34.5 per cent in the quarter.

Set that against total revenue growth of 44.1 per cent. Most of the growth came from stores that already existed a year ago. Twelve net new boutiques supplied the rest.

That ratio is the useful one here. A retailer growing mainly by opening doors has to keep opening them. A retailer growing mainly through existing doors does not.

The margin carries a refund, and the company says so

The reported gross profit margin was 57.1 per cent, up 1,330 basis points.

That figure includes C$97.4 million of tariff refunds. A tariff refund is money returned on import duties the company had already paid. It is cash, and it is real. It is not a change in what the clothes cost to make or sell.

Aritzia reports the figure both ways. Excluding the refunds, the adjusted gross margin was 48.7 per cent, up 490 basis points. That second number describes the operating business.

The gap between the two is about 840 basis points. On C$1.17 billion of revenue, that gap is most of the C$97.4 million.

A 490 basis point improvement in a single quarter is a strong result on its own terms. It is also roughly a third of the headline figure, and the headline figure is the one that travels.

Two profit numbers, both in the release

Net income was C$201.7 million, up 204.2 per cent. Diluted earnings were C$1.70 a share, against C$0.56 a year earlier.

The release also gives adjusted figures. Adjusted net income was C$156.0 million and adjusted diluted earnings were C$1.31. The difference between the reported and adjusted net income is C$45.7 million.

Adjusted EBITDA was C$246.2 million, up 99.7 per cent, at a 21.0 per cent margin. That margin is 590 basis points higher than a year earlier.

Free cash flow was C$214.3 million in the quarter and C$205.7 million for the half. Cash was C$528.1 million at quarter end. Inventory was C$714.9 million, up 35.8 per cent.

The outlook rose, and it assumes no more refunds

The company set out a fiscal 2027 outlook beside its previous one.

Net revenue is now expected at C$4.78 billion to C$4.88 billion, growth of about 29 to 32 per cent. The previous outlook was C$4.55 billion to C$4.75 billion, about 23 to 28 per cent.

Adjusted gross margin is now expected up about 225 to 275 basis points from 44.9 per cent in fiscal 2026. The previous outlook was up about 175 to 225 basis points.

Adjusted EBITDA margin is now expected at about 20.0 per cent, against 17.8 per cent in fiscal 2026. The previous expectation was about 19.5 per cent.

The release does not use the word raised. It states the old figures beside the new ones, and the new ones are higher in all three.

One line governs how to read them. The outlook excludes any tariff refund benefit. The improvement the company is forecasting is therefore an operating forecast, not a repeat of this quarter's cash return.

Capital expenditure, net of lease incentives, is guided to about C$250 million. Depreciation and amortisation is guided to about C$130 million.

Growth of this kind is paid for in advance

Expansion shows up in the balance sheet before it reaches revenue.

The guided C$250 million of capital expenditure is roughly five per cent of forecast revenue. It funds the 12 to 13 new boutiques and the four to five repositions. Boutiques are paid for in the year they open and earn over many.

Inventory is the other payment made in advance. It rose 35.8 per cent while revenue rose 44.1 per cent. Stock growing more slowly than sales is the ordinary test, and this passes it.

The half-year figures show what the timing costs. Free cash flow was C$214.3 million in the quarter but C$205.7 million for the half. The first quarter therefore consumed cash.

That pattern is ordinary for an apparel retailer building stock into autumn. It is a reason to read the halves rather than the quarters. A single strong quarter can be a shipment that landed early.

A fifth of a C$16.8 billion company repriced in one session

The shares closed at C$146.91 on 9 October 2026, up C$25.02 or 20.5 per cent. The day's high was C$147.72 and the low was C$135.00.

Volume was 2.31 million shares against a thirty-day average of 642,704. That is about 3.6 times normal. At the day's volume-weighted average price of C$142.43, the turnover was roughly C$329 million.

Price and volume above are QuoteMedia quotes, read after the close on 9 October 2026. That feed carries a 15-minute delay.

The move added about C$2.9 billion of market value, on 114.6 million shares outstanding. The company ended the session worth about C$16.84 billion. Against the midpoint of its own revenue outlook, that is roughly 3.5 times fiscal 2027 sales.

Short interest on the same feed was 4.09 million shares. That is about 3.6 per cent of the shares outstanding.

A one-day move is not a verdict on any of this. It is the market pricing a quarter it had not seen, and a forecast it had not been given.

What the next quarter has to separate

The refund arrived once. The 490 basis points did not.

The third quarter report will show whether the adjusted margin holds without the tariff line underneath it. It will also show whether American revenue keeps growing at three times the Canadian rate. Aritzia has given the figures needed to check both.

Two numbers describe the same quarter, and the company printed both. Only one of them will still be there in January.

Transparency note. This is an independent due-diligence analysis and editorial opinion piece produced by The Maple Markets editorial desk. It is not sponsored, promoted or commissioned, and no compensation of any kind has been received from Aritzia Inc. (TSX: ATZ) or any party acting on their behalf. The analysis is based on public disclosure available as of the publish date; every figure is attributed to its primary source. The Maple Markets and its authors may hold positions in securities mentioned; nothing here is a recommendation to buy, sell or hold any security, and readers should not treat it as investment advice. Past disclosure does not guarantee future results. Policies: Editorial Standards · Financial Disclaimer.