Five Below Eliminates Five Beyond Store Section, Reports 32.5% Q1 Sales Jump

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6.5.2026

Quick Facts

Five Below eliminated dedicated Five Beyond sections and integrated higher-priced items into regular store categories
Q1 2026 net sales jumped 32.5% to nearly $1.3 billion, with comparable sales up 22.7%
Growth was driven by viral squishy dumpling toys and increased customer traffic with smaller basket sizes

Five Below discontinued its dedicated Five Beyond store section and moved higher-priced products into regular merchandise categories. CEO Winnie Park announced the change during the company’s Q1 2026 earnings call on June 4.

The discount retailer found that Five Beyond products performed better when integrated into the main store layout. “We moved that product in line, and we’ve actually seen that product perform better because it’s basically merchandised the way the customer wants to shop the product,” Park said.

Five Below reported exceptional Q1 2026 results. Net sales increased 32.5% to nearly $1.3 billion. Comparable sales rose 22.7%, driven by a 19% increase in transactions and a 4% increase in average ticket size.

The company beat analyst estimates with adjusted earnings per share of $2.22, compared to expectations of $1.69-$1.74. Five Below raised its full-year sales guidance to $5.4-$5.48 billion.

Viral social media trends drove much of the growth. The company capitalized on the popularity of squishy dumpling toys, which became a sensation on social platforms. “The dumpling trend is something that we’ve had as an item in our assortment for about five years. We started seeing it pop up in social. What we did was amplify what was becoming hot,” Park explained.

The Five Beyond concept launched as a store-within-a-store section featuring products priced above $5. The company converted nearly 250 stores to the format in 2022 and added 400 more in 2023. Customers who bought Five Beyond items typically spent twice as much as those purchasing only items $5 and under.

Despite strong results, investor concerns emerged about the sustainability of trend-driven growth. Five Below’s stock declined as analysts worried about difficult year-over-year comparisons in 2027. The underlying comparable sales growth was only in the high single digits, with viral trends contributing low teens percentage points.

CFO Daniel Sullivan expressed caution about the economic environment. “We’re being cautious… We’re looking at the world that our customers are living in with rising fuel costs with very sticky inflation with a somewhat soft labor market,” he said.

Five Below operates 1,970 stores and opened 49 net new locations in Q1. The company maintains that 80% of its assortment remains priced at $5 and below. It expects full-year comparable sales growth of 6% to 8% and plans to open 150 net new stores.