Ross Stores (ROST) saw its shares plummet 11.48% in after-hours trading following the release of its first-quarter earnings report and the unexpected withdrawal of its full-year guidance. The discount retailer's stock decline was primarily driven by growing concerns over the impact of tariffs on its profitability and a cautious outlook for the coming quarter.

In its earnings release, Ross Stores reported first-quarter earnings per share of $1.47, slightly above analysts' expectations. However, the company's decision to withdraw its previously provided annual sales and earnings guidance sent shockwaves through the market. CEO Jim Conroy cited "heightened macroeconomic and geopolitical uncertainty" as the primary reason for this move, specifically pointing to "prolonged inflation and evolving trade policies" as key concerns.

Adding to investor worries, Ross Stores provided a disappointing outlook for the second quarter. The company now projects earnings per share between $1.40 and $1.55, well below the consensus estimate of $1.65. This guidance includes an anticipated cost impact of $0.11 to $0.16 per share due to announced tariffs. Conroy revealed that while Ross directly imports only a small portion of its merchandise, more than half of the goods it sells originate from China, making the company particularly vulnerable to ongoing trade tensions. As a result, Ross Stores expects pressure on its profitability if tariffs remain at elevated levels. The cautious outlook and withdrawal of full-year guidance signal potential challenges ahead for the retailer as it navigates an uncertain trade environment and persistent inflationary pressures.