Savers Value Village（SVV）2026年第3四半期決算説明会：米既存店売上高が5.9%増

要点

• 2026年度第3四半期の売上高は前年同期比8.5%増の4億6,300万ドルとなった。為替変動の影響を除いた売上高は8.9%増、既存店売上高は4.2%増となった。
• 米国の売上高は12.2%増の2億6,300万ドルとなり、取引件数と平均客単価（バスケットサイズ）の双方が拡大したことで既存店売上高は5.9%増となった。
• 調整後EBITDAは8%増の7,600万ドルとなり、4四半期連続の前年同期比プラス成長を記録した。調整後EBITDAマージンは16.4%となった。
• カナダの既存店売上高は1.5%増加した。供給量の増加、規律ある生産、生産性向上を背景に、セグメント利益は10%増の5,000万ドルとなり、セグメント利益率は210ベーシスポイント拡大した。
• 経営陣は2026年度通期の見通しを更新し、売上高を17億7,000万〜17億8,000万ドル、調整後EBITDAを2億7,000万〜2億7,500万ドルとした。
• 当四半期末時点で「ThriftIQ」は108店舗で稼働していた。同社は、完全導入後に「Autotagger」と統合画像キャプチャシステムにより、年間約1,000万ドルの人件費削減効果が創出されると見込んでいる。

主要財務データ

事業および営業概況

米国の既存店売上高の成長は、地域、製品カテゴリー、所得層を問わず広範にわたった。経営陣によると、若年層と高所得世帯が引き続き最も好調な顧客層の一角を占めている。また、新店舗の収益性も同社の当初予想を上回るペースで拡大を続けた。

セイバーズ・バリュー・ビレッジ（Savers Value Village）は当四半期中、テネシー州初となる店舗を含め、米国で8店舗、オーストラリアで1店舗を出店した。2026年度の新規出店計画は約25店舗のままで、そのうち20店舗以上が全米11州に展開される予定である。経営陣は、新店舗展開による成長を最も投資収益率が高く、極めて重要な資本使途であると位置づけた。

カナダでは、店舗での寄付受け入れ供給の改善、規律ある生産、生産性向上の取り組みにより、セグメント利益率が210ベーシスポイント拡大した。また経営陣は、保守的な計画姿勢を維持しつつも、カナダの低所得層顧客における成長の再加速を心強い兆候として挙げた。

「ThriftIQ」は4万5,000超のブランドを網羅するデータを活用し、4,000万点以上の商品の値付けを行ってきた。経営陣によると、導入店舗では平均価格が全店舗水準以下であるにもかかわらず、未導入店舗と比べて販売消化率が高く、客単価が拡大し、売上総利益の伸びがより急速であったという。

新たに発表された「Autotagger」と統合画像キャプチャシステムは、処理工程と所要人員の削減を目的としている。導入は2028年上半期まで続く見込みである。同社は展開期間中、既存の設備投資計画の枠内で約4,000万ドルの関連設備投資を見込んでいる。

経営陣の業績予想（ガイダンス）

第4四半期について経営陣は、前年同期に第53週が含まれていたため、報告ベースの売上高成長率は前年同期比で概ね横ばいになると予想している。この影響を除いたベースでは、売上高は1桁台半ばから後半の伸び率で増加する見込みである。

経営陣は、米国の既存店売上高が1桁台前半から半ばの伸び率で、カナダの既存店売上高が1桁台前半の伸び率で増加すると見込んでいる。第4四半期の調整後EBITDAマージンは小幅に拡大する予想である。

同社は2027年以降の3年間にわたり、年間50〜100ベーシスポイントの調整後EBITDAマージン拡大を目標とし続けている。技術革新の恩恵や新店舗の成熟には時間を要することから、経営陣は2027年の改善幅が下限付近（約50ベーシスポイント）になると予想している。

リスクおよび注視事項

• 第4四半期の米国既存店売上高の成長率は、前年同期の8.8%増という高い伸びを一巡することから、鈍化する見通しである。
• 2026年度の見通しは、カナダの経済情勢に当面の間、重大な変化がないことを前提としている。
• 米国の新店舗は、売上、寄付供給、収益性を確立するまでの間、短期的な利益率の圧迫要因となる。
• 2028年初頭にかけて本格的な導入が進められるため、「ThriftIQ」と「Autotagger」による恩恵は即効性があるというよりも、徐々に現れる見込みである。
• 経営陣は、四半期ごとの利益率拡大は必ずしも一本調子に進むとは限らず、既存店売上高の伸びや新店舗の業績にも一部左右されると述べた。

アナリスト質疑応答（Q&A）のハイライト

経営陣は、米国の既存店売上高の増加について、取引件数と客単価（バスケットサイズ）のバランスの取れた貢献によるものと説明した。また、一貫した事業執行、差別化された商品展開、優れたバリュー・ポジショニング、そしてスリフト（古着・リユース品）ショッピングの浸透拡大を要因として挙げた。

売上総利益率について経営陣は、米国の既存店増収によるレバレッジ効果、カナダでの販売利回りの向上、店舗での寄付受け入れの強化、店外処理の効率化、新店舗の成熟を挙げた。第4四半期の売上総利益率の改善幅は、第3四半期の100ベーシスポイント改善とおおむね同水準になると見込んでいる。

経営陣は、短期的には既存店売上高のレバレッジ効果が利益率拡大の最大の要因になると述べた。技術導入の進展や出店グループ（コホート）の成熟に伴い、イノベーションと新店舗の成熟による寄与度がより高まる見通しである。

同社は成長を買収に依存する計画はない。経営陣は、出店立地選定の向上、新店舗専任チーム、より洗練された地域マーケティングの展開手法に支えられた、米国でのオーガニックな自律拡大に引き続き注力する方針を示した。

決算説明会（アーニングスコール）全文トランスクリプト

決算説明会の完全なトランスクリプト

経営陣による説明

Operator

Good afternoon, and welcome to Savers Value Village's conference call to discuss financial results for the third quarter ending October 3, 2026. [Operator Instructions] Later we will conduct question-and-answer session, and instructions will follow at that time. Please note that this call is being recorded and a replay of this call and related materials will be available on the company's Investor Relations website. The comments made during this call and the Q&A that follows are copyrighted by the company and cannot be reproduced without written authorization from the company.

Certain comments made during this call may constitute forward-looking statements, which are subject to significant risks and uncertainties that could cause the company's actual results to differ materially from expectations or historical performance. Please review the disclosure on forward-looking statements included in the company's earnings release and filings with the SEC for a discussion of these risks and uncertainties. Please be advised that statements are current only as of the date of this call. And while the company may choose to update these statements in the future, it is under no obligation to do so unless required by applicable law or regulation. The company may also discuss certain non-GAAP financial measures. A reconciliation of each of the historical non-GAAP measures to the most directly comparable GAAP financial measure can be found in today's earnings release and SEC filings.

Joining from management on today's call are Mark Walsh, Chief Executive Officer; Jubran Tanious, President and Chief Operating Officer; Michael Maher, Chief Financial Officer; and Ed Yruma, Vice President of Investor Relations and Treasury.

Mr. Walsh, you may go ahead, sir.

Mark Walsh

Thank you, and good afternoon, everyone. We appreciate you joining us today. We are pleased with the strength of our third quarter results, which underscores the momentum in our business. Our compelling assortment and sharp value continue to win with consumers. This translates into ongoing earnings momentum, including a fourth consecutive quarter of year-over-year adjusted EBITDA growth.

Let me start with a few highlights from the quarter. Sales in our U.S. business grew 12.2% with comps up 5.9%, driven by both average basket and transactions. Secular adoption of Thrift remains strong. In Canada, comps increased 1.5% during the quarter, driven by average basket. Canadian segment profit increased 10% and segment profit margin expanded 210 basis points, once again showing the impact of our productivity and profit improvement initiatives. Adjusted EBITDA increased 8% to $76 million or 16.4% of sales. And finally, we are updating our outlook for 2026, which Michael will address as part of his remarks.

Turning to our results by geography. Let's start in the U.S. where momentum remains strong. The 5.9% U.S. comp was broad-based with growth across regions, categories and income cohorts. Younger and higher household income shoppers are still some of our highest-performing demographics. Competitively, we are in a great place and well positioned with value gaps to discount. And traditional retailers remaining about 40% to 70%. On-site donation growth trends are strong. And we see ample available supply to fuel our future new store opening plans.

And finally, from a real estate perspective, our white space opportunity is significant and site availability is robust. Simply put, the U.S. business continues to perform strongly. And we are excited to bring our compelling values to new customers and new markets.

In Canada, we are encouraged by our 1.5% comp and 10% segment profit growth. We have driven strong OSD supply growth, remained disciplined on production levels and see nice productivity gains, which have all contributed to continued margin expansion. Our team is executing well. And we are optimistic about the direction of our business. We will continue to plan prudently.

Moving to new stores. We opened 8 locations in the U.S. and 1 in Australia during the quarter, including the successful opening of our first store in Tennessee. Strong performance out of the gate in new markets underpins our confidence that our model is durable and scalable across regions. We continue to see new store profitability ramp ahead of our original expectations, supported in part by ThriftIQ. As I noted earlier, we are excited to continue growing our store fleet in the U.S. and believe we can expand at the current pace for years to come.

For 2026, our plan remains to open 25 new stores, more than 20 of which will be in the U.S. across 11 states with a nice mix of infill and new markets. New store growth remains the highest return and most important use of our capital. And we are excited to bring our value offering to more consumers.

Shifting to innovation. First, I would like to provide an update on ThriftIQ. As of the end of the quarter, the platform is now priced over 40 million items, utilizing our proprietary data set, which covers over 45,000 brands. ThriftIQ is now live in 108 stores. And in these locations, we continue to see an improved price value equation, resulting in increased unit sell-through, larger baskets, higher sales yields and average prices that are the same or lower than the rest of the fleet.

Additionally, we are excited to announce the next step in our innovation road map, the Autotagger with integrated image capture capability. These are patent-pending engineering solutions that drive labor efficiency by reducing the number of touches required to process each item. Michael will provide more details on the financial impact. But this is a powerful example of innovation driving greater efficiency in our business.

Our innovation agenda continues to focus on 3 key areas: strengthening our price value equation; driving efficiency and cost reduction; and lastly, expanding our data science and business insights. The Autotagger and integrated image capture technologies now join ThriftIQ, automated book processing, autonomous floor scrubbers, AI-enabled HVAC integration and agentic AI capabilities in our innovation toolkit. We look forward to providing more details on how our innovative culture drives great consumer experiences and helps power our medium-term adjusted EBITDA margin expansion targets at our Innovation Day in Minneapolis next week.

Finally, we recently released our fifth impact and sustainability report, which can be found on our Investor Relations website. We are a mission-driven business, championing reuse and looking to inspire a future where secondhand is second nature. This report highlights the impact and circularity ingrained in our model. I am proud that over the past 5 years, we have kept 3.6 billion pounds of usable items out of landfills and paid our nonprofit partners over $0.5 billion. We hope you take the time to review the report and our commitment to community impact, sustainability and sound corporate governance and reporting.

I want to thank our nearly 24,000 team members for their hard work in delivering strong financial results and helping sustain our momentum. We are grateful for their efforts to bring an exciting Thrift shopping experience to new markets and customers.

I'll now hand the call over to Michael to discuss our third quarter financial performance and the updated outlook for the remainder of 2026.

Michael Maher

Thank you, Mark, and good afternoon, everyone. As Mark indicated, we had a strong third quarter. Total net sales increased 8.5% to $463 million. On a constant currency basis, net sales increased 8.9% and comparable store sales increased 4.2%. We're especially pleased with our sales results in the U.S., where net sales increased 12.2% to $263 million.

Comparable store sales increased 5.9%, driven by both average basket and transactions. Our treasure hunt shopping experience featuring low-priced, one-of-a-kind merchandise continues to resonate across demographics and support the secular adoption of Thrift. Given the breadth of our comp strength and compelling new store performance, we remain confident in our ability to grow and scale the U.S. business.

We also saw encouraging trends in Canada, where net sales increased 2.5% with constant currency sales up 4.3% to $167 million and comparable store sales up 1.5%. Segment margins expanded by 210 basis points, reflecting strong OSD supply growth, disciplined production management, productivity gains and the continued maturation of our new stores. We believe this Canadian profit improvement is sustainable through the balance of the year. And with the addition of ThriftIQ, Autotagger and integrated image capture capability, we are confident in our ability to drive future incremental profit growth. Our guidance does not contemplate a material change in Canadian economic conditions in the near-term. But we are encouraged by underlying trends in the business.

Cost of merchandise sold as a percentage of net sales decreased 100 basis points to 43.1% due to comp leverage and efficiency initiatives as well as growth in on-site donations, partially offset by the impact of new store openings. Salaries, wages and benefits expense was $88 million. Excluding IPO-related stock-based compensation, salaries, wages and benefits as a percentage of net sales increased 20 basis points to 19%. The increase was driven primarily by new store growth and an increase in annual incentive plan expense.

Selling, general and administrative expenses increased 6% to $105 million and as a percentage of net sales decreased 60 basis points to 22.7%, reflecting growth in our store base, increased repair and maintenance expense and information technology investments, partially offset by decreased impairment charges and lease termination gains.

Depreciation and amortization increased 35% to $25 million, reflecting continued investments in new stores, off-site processing and information technology as well as capital maintenance expenditures. Net interest expense decreased 35% to $11 million, primarily due to the impact of our debt refinancing last fall.

GAAP net income for the quarter was $23 million or $0.15 per diluted share. Adjusted net income was $26 million or $0.16 per diluted share. Third quarter adjusted EBITDA was $76 million and adjusted EBITDA margin was 16.4%. U.S. segment profit was $56 million, an increase of $8 million, primarily due to increased profit from our comparable stores. Canada segment profit was $50 million or an increase of $5 million due to increased operating efficiency driven by our profit improvement initiatives.

On the innovation front, as Mark noted, ThriftIQ is currently live in 108 stores across the U.S. and Canada. In these stores, we continue to see increased unit sell-through, larger baskets and higher sales yields with the same or lower average prices compared to the rest of our fleet. As a result, stores with ThriftIQ continue to see faster gross profit growth than the rest of the fleet and that gap has widened since last quarter.

We also announced today our new patent-pending Autotagger and integrated image capture solutions. Upon full deployment, we expect these technologies to deliver annualized labor savings of approximately $10 million.

I want to highlight that all of our recently announced innovations, ThriftIQ, Autotagger and Image Capture were contemplated in the framework we gave last quarter for 50 to 100 basis points of annual adjusted EBITDA margin expansion over the next 3 years beginning in 2027. We look forward to discussing this further at our Innovation Day next week.

Our new stores continue to perform in line with our expectations on the top line. And as previously mentioned, their profitability is ramping ahead of our original expectations. This reflects elevated site selection, strong operational execution and improved and evolving marketing approach and the impact of ThriftIQ, which 4reduces the time required to train new graders by roughly half.

Our balance sheet remains strong with $60 million in cash and cash equivalents and a net leverage ratio of 2.3x at the end of the quarter. We repaid $52 million of debt during the quarter and as previously announced, repurchased 1 million shares at a weighted average price of $9.79 as part of the secondary offering in August.

This quarter was a great example of the cash generation power of our model. And our capital allocation priorities in action as we continue to organically fund new store growth, repaid debt as we target a net leverage ratio under 2x by the end of next year and opportunistically repurchased shares.

I'd like to now turn to our guidance and discuss our updated outlook for the remainder of fiscal 2026. Our updated outlook reflects our third quarter performance, holding our view of the fourth quarter largely unchanged. The cost and benefits of our various innovation initiatives are also incorporated with the financial contribution from each expected to build as deployment scales.

We now expect net sales of $1.77 billion to $1.78 billion, comparable store sales growth of 3.5% to 4.0%. Net income of $69 million to $75 million or $0.43 to $0.47 per diluted share. Adjusted net income of $76 million to $83 million or $0.48 to $0.52 per diluted share. Adjusted EBITDA of $270 million to $275 million. Capital expenditures of $135 million to $145 million with approximately 25 new store openings. Net interest expense of approximately $48 million and an effective tax rate of approximately 28%. We are projecting weighted average diluted shares outstanding to be approximately 160 million for the full year. This does not contemplate any potential future share repurchases.

Finally, I'd like to briefly touch on our expectations for the fourth quarter. We plan to open 7 new stores during the quarter. We expect total revenue growth to be roughly flat compared to Q4 of last year, up mid to high single-digit, excluding the impact of last year's 53rd week.

We expect comp sales growth to be modestly lower than Q3 as we lap one of the strongest U.S. quarters in recent memory. We expect U.S. comps in the low to mid-single digits and Canada comps in the low single digits. We expect Q4 adjusted EBITDA margin to expand modestly, marking a key inflection point and providing us confidence in our path to EBITDA margin expansion in the coming years.

This concludes our prepared remarks. We would now like to open the call for questions. Operator?

Operator

[Operator Instructions] Your first question comes from the line of Matthew Boss with JPMorgan.

質疑応答

Matthew Boss

Congrats on a nice quarter.

Mark Walsh

Thanks Matt.

Matthew Boss

So Mark, could you speak to the composition of the 5.9% U.S. comp this quarter between traffic and ticket? And with 8 straight quarters now of mid to high single-digit comps in the U.S., what do you attribute to the step-up in top line trend?

Mark Walsh

So Matt, I think similar to the balance of the year-to-date, it's been basket transaction, very, very consistent. And in terms of 8 straight quarters of mid to high single-digit comps, consistent execution, great value proposition, unique selection, really fun Thrift to shopping experience. And I think overall, the secular adoption that we still see broad acceptance across geographies, income cohorts and age ranges.

Matthew Boss

And then, Michael, on the bottom line, could you elaborate on the drivers of 100 basis points gross margin expansion this quarter? Are you seeing any initial benefits from ThriftIQ? And any puts and takes to consider for gross margin in the fourth quarter?

Michael Maher

Yes, Matt, sure. So the gross margin leverage that we saw in Q3, similar to story to what we've been talking about all year. So it's a number of factors. Comp leverage in the U.S. on that strong mid-single-digit comp, really exceptional sales yield growth, especially in Canada. We've been talking about production management there throughout the year, robust on-site donation growth in both countries. Off-site processing improvements in both sales yields and cost efficiencies and then continued maturation of our new stores and that historical headwind starting to turn and becoming a tailwind.

We are seeing some benefits from ThriftIQ. Yes, as we talked about in our prepared remarks. Those stores continue to demonstrate faster gross profit growth than the rest of the fleet. However, bear in mind, it's still a relatively small group of stores. While we are now live in over 100 stores, it's not a flick of the switch and immediately we see the gross profit benefits, right? It takes some time for those price recommendations to flow through for the previously priced items on the floor to sell through. And so the actual benefit to the overall business thus far is still relatively small.

As for the fourth quarter, all of the factors that I talked about in terms of what drove that third quarter performance are still in play and are still very much operative. And so when you think about our outlook for the balance of the year, I would actually expect gross margin improvement in the fourth quarter to be roughly similar to what we saw in Q3.

Operator

Your next question comes from the line of Brooke Roach with Goldman Sachs.

Brooke Roach

Mark, Michael, I'd love to hear a little bit more about the pacing of some of the innovation that you're looking to roll out across ThriftIQ and the newly unveiled Autotagger. It sounds like Autotagger could add an incremental 50 basis points of margin once it's fully deployed. How should we be thinking about the cadence and time line of that deployment and any other innovation that will continue to build ahead? And then are there any costs associated with that that will weigh on near-term margins that will turn to a bigger benefit in '27 and beyond?

Mark Walsh

Brooke, this is Mark. We are super excited about Autotagger. Thank you for the question. I'm going to turn it over to Jubran to talk about some of the nuances and Michael will follow up on the specific financial questions you raised.

Jubran Tanious

Brooke, this is Jubran. So very excited about Autotagger. Also excited to showcase that for those of us that can join us next week at our Innovation Day in Minneapolis. Autotagger is -- we are literally on the front end of rolling it this quarter. And we expect the rollout of that to more or less match our rollout timing across the fleet, the same as ThriftIQ, which will bring us into the first portion, first half of 2028. So feel good about that, putting a premium on execution and change management. But everything is lining up to be very attractive for that time frame of rollout.

Michael Maher

So Brooke, it's Michael. As far as the financials on Autotagger, first of all, there is a capital investment. We will spend approximately $40 million in CapEx over the next couple of years as we're rolling that out across the fleet in the timetable that Jubran laid out, does not change our overall CapEx algorithm in that high single-digit percentage of revenue remains -- that envelope remains the same. But this will be a component of our innovation capital over that time period.

The $10 million roughly of annual expense savings is what we can expect once we're fully rolled out. So that benefit will build. It will be a portion of that in 2027 and growing into 2028 and beyond once we're fully live on that. So as far as what that does to our overall EBITDA margins, I do want to remind you that that is contemplated in the outlook that we have previously given of 50 to 100 basis points per year. And that is going to be together with ThriftIQ and our other innovation efforts along with the other pillars that we've talked about, new store maturation and comp leverage. So 50 to 100 basis points a year, inclusive of all of that over the next 3 years on our path back to a high teens EBITDA margin.

Brooke Roach

Great. And then, Michael, just one quick follow-up for you. Can you speak to the drivers of the inflection to EBITDA margin expansion in 4Q given your comment about gross profit margin improvement similar in 4Q versus 3Q?

Michael Maher

Yes, absolutely, Brooke. In fact, I think it's worth kind of backing up and going back to the earlier part of this year. We've been saying for a while that 2026 would be our inflection in which we would start to deliver EBITDA dollar growth. We have now done that for 4 consecutive quarters, largely driven, again, as we've talked about, not only by the core business, but also by the inflection in our new store maturation.

We also said that that would be the trough in our EBITDA margin, and that is playing out. If you look at our guidance range, we're now expecting to be flat to slightly positive on EBITDA margin for the year, exiting the year on a nice path, a nice trajectory consistent with what we've laid out for the next few years.

And I think that is reflective of everything that we've sort of talked about and committed to up to this point, namely the continued maturation of new stores and the impact of that and leverage on our comp business. But now also increasingly as we go forward, the contribution of our innovation agenda as well.

And so those things will continue to build. Not every quarter will be a straight line. But I do think Q4 is a nice early down payment, if you will, on EBITDA margin expansion in 2027 and beyond.

Operator

Your next question comes from the line of Mark Altschwager with Baird.

Mark Altschwager

Following up on that last comment just on the margin inflection. As we think about that 50 to 100 basis points for 2027 and beyond. Can you speak to, I guess, the relative contribution from the new store maturation, some of these innovation initiatives and just core comp leverage?

Michael Maher

Yes, Mark, sure. So we're going to talk a little bit more about this at Innovation Day next week as well. But all 3 of those things are legs of the stool of margin expansion over the next 3 years as we progress back up into the high teens. And they're all meaningful contributors.

So right now, I would say the largest in the near-term is continued leverage on our comp business. Innovation and new stores, both are going to build with time. In the case of innovation, it's the deployment of ThriftIQ and Autotagger and Image Capture. Those benefits build as we scale that across the fleet. And as Jubran indicated, that's going to take us into the early part of 2028.

New stores, similar story. That has been building for some time and will continue to build. First, we had the inflection point from headwind to tailwind, which we've seen this year. Next and coming -- going forward, we're going to start to see the impact on EBITDA margin flipped as well. But again, that's a function of time and older classes of new stores continuing to mature and increase profitability.

Mark Altschwager

And then following up on Canada, the comps improving to plus 1.5%. What do you think drove the better trend versus your flat comp plan? And then I think you said you're not anticipating further improvement there. But just maybe walk us through how you're thinking about the Canada trajectory, both from a comp and further margin opportunity from here?

Mark Walsh

Mark, thanks. This is Mark. So a couple of things around Canada. Let me start with what we think changed in terms of the Canadian consumer, which is very important. Canadian consumer continues to skew younger. But in the third quarter, what we saw, and it's probably the best news in Canada we've seen in a while, is that lower household income cohort showed growth. As we said in previous quarters, these customers were on the sidelines. We see this growth as a real green shoot. We're still planning conservatively. We have reason for optimism.

And really, what's happened in Canada, -- hasn't happened is matching production to demand, that execution level is still super tight. We're delivering that compelling price value. We've invested modestly in marketing and the fleet. But I think all of these things and that modestly improving macro have conspired to improve our sales trajectory.

Operator

Your next question comes from the line of Randy Konik with Jefferies.

Randal Konik

I guess, Michael, when you think about the idea of maturity or maturing stores in the U.S. market. I think there's just a different conversation than in Canada where I think you've said in the past that 95%, I believe, awareness in the Canadian market by the citizens there. But the amount of awareness of the brand and the business in the U.S. is extremely low.

So when you think about -- as the time goes by and the awareness levels build. It would seem that the sales productivity per foot to move incrementally much higher for the fleet. I want to just kind of understand your thoughts around that concept. And then when you look at the geographic margins of the U.S. relative to Canada. If you think about that productivity improvement opportunity long term. How does that kind of inform your opinion of where the geographic margins for the U.S. go relative to Canada?

Michael Maher

Yes. Randy, thanks for the question. So a couple of things. First of all, your thoughts on the long-term trajectory of U.S. comps. I think that's fair. I mean I think that's consistent with what we've talked about for a while, which is that we're still in earlier innings of Thrift adoption. We still have a lot of white space. When you think about the way we're seeing that show up in our business, the consistent now as you've already seen us talk about here, the broad-based strength across categories and regions and income demographics. Just all speaks to the continued runway for that broader secular adoption.

I would also say there's a sort of a mechanical factor at play here, which is as we continue to grow in the U.S. and more new stores enter the comp base, our comp base gets younger on average. And that provides a tailwind to the comp growth in the U.S. We've said before this year, that tailwind has been worth about 50 basis points. I expect that tailwind to build as we go forward into 2027 and beyond. So yes, in short, because of all of that and because we are much more mature in Canada, we do expect U.S. comps to continue to outpace Canadian comps for the long term.

As far as the margin profile, the contribution margin, some different dynamics there. I think what you have seen in Canada this year, which we're really proud of, is a reflection of some exceptional operating disciplines around management of production and sales yields, off-site processing, on-site donation growth. And that kind of year-over-year improvement, while we think that has more room to run through the balance of this year. You're not going to see that kind of improvement every single year.

However, we do have additional ammunition from our innovation initiatives that we think can drive profit improvement as we go forward. And we should be able to sustain profit margins in Canada at something like this level with only very modest low single-digit comp sales growth.

The U.S. is a little bit different. It's always had a structurally lower margin. And we're still accelerating our growth in the U.S., which, as you know, creates some short-term headwinds. So in the near-term -- near- to medium-term, I would say, we'll continue to see that divergence between U.S. and Canadian profit margins.

Randal Konik

Great. And I guess, Mark, for you. Knowing what you know about what you're going to show us next week, what would be like the 1, 2 or 3 things you want us to kind of take away either qualitatively or quantitatively in terms of what we're going to witness next week when we come out to see you guys?

Mark Walsh

I would say this, I think it's one thing. The company has a tremendous culture of innovation. You are going to see it on display and you're going to be impressed.

Operator

Your next question comes from the line of Michael Lasser with UBS.

Michael Lasser

Your guidance implies and your commentary implies that you're going to see a slower comp in the fourth quarter. Presumably, some of that was related to the weather from last year where that fostered some demand for cold weather seasonal goods. So have you already started to see the slowdown? Or is that more November to December when you're expecting the moderation to occur?

Michael Maher

Michael, it's Michael. Yes. So that's correct. Let me talk, first of all, about the cadence of the comp through third quarter and how we're seeing that extend into Q4. So in the U.S., we did see some modest sequential moderation throughout Q3 as we started to lap tougher comparisons from a year ago, very modest. September was only slightly below the third quarter average.

And we do see continued moderation in early Q4, which is what we have expected all year and have communicated to you all previously. Something in the low- to mid-single-digit range in the fourth quarter, not so much because of weather, although that's always a sort of factor intra-quarter, really because we're now lapping the strongest quarter in the recent history of the company in the U.S. We did an 8.8% comp a year ago. So it's really more a function of that, Michael.

Certainly, there's always some weather factor. We've seen some warmer weather in the Midwest, for example. But those things tend to even out over the course of the quarter. By the way, I would just say it's the opposite in Canada. We had sequential acceleration throughout the third quarter in Canada. And so far in Q4, what we're seeing in Canada is roughly in line with Q3.

Michael Lasser

Michael, to beg the question, what was the exit rate? Have you seen 2-year stacks remained pretty consistent over the course of 3Q into the current period?

Michael Maher

Yes. Enterprise-wide, 2-year stacks remained consistent.

Michael Lasser

Okay. My follow-up question is Savers has a long history and heritage of being innovated. PPCs and ADPs are good examples of that. How would you compare and contrast the magnitude of the impact from the technology that you are going to implement over the next 24 months to what has already been in place over the last few years. And if this is a model that is inherently more profitable, higher returns. Does it make sense to accelerate the store growth or engage in more M&A because you have a model that can benefit from all that capital deployment?

Mark Walsh

Yes, Michael, I'm going to start with the last piece of that question. It's a terrific question, by the way. From an M&A perspective, we're not looking for M&A to drive our growth. We've got tremendous white space ahead of us. We're really comfortable with our execution pace on new stores and we see great results in our new stores. The innovation agenda just bolsters our ability to move forward and deliver additional profitability as we improve our processes. I mean Jubran is really championed the auto tagging solution.

I'll turn it over to him to sort of provide you additional color on that sort of culture of innovation you harken to.

Jubran Tanious

Yes, Michael. And hopefully, you can join us next week. But innovation in our company, as Mark talked about, is not a one and done. It's continuous improvement. It's looking for derivatives on things that we've already created. Very excited about this latest chapter, which will affect the entire fleet. So lots of things in the hopper. We want to take a scientific approach on all of it, a test-and-learn approach.

And then in terms of unlocking new stores, we're pretty happy with our pipeline and performance of new stores, like Mark talked about and excited about our 2027 pipeline, very pleased with the performance of the stores that we have opened to date. We think we've done a lot of things to get better over time over that. And it really comes down to a balance.

I mean, we have a bias for execution and a high success rate on new stores. And as we think about the majority of our new stores opening in the U.S., entering a variety of new markets where there's amazing white space. Again, we want to put a premium on execution and striking the right balance of all the factors that go into opening a new store.

Operator

Your next question comes from the line of Bob Drbul with BTIG.

Robert Drbul

I was just wondering, can you focus a little bit on the sort of traction with younger consumers and the affluent consumers sort of how you're seeing within some of your new stores? And I think just following some of the other questions. But can you unpack a bit more sort of how you're feeling about some of the new markets that you've entered?

Mark Walsh

Why don't I jump in with the question around the consumer and maybe Jubran, you can talk about the 2 new stores in North Carolina and Tennessee. Broadly speaking, the Canadian and U.S. customer is getting younger and that gives us great optimism for the future. And in both countries, we have seen consistently the higher household income demographic being more drawn to the environment and the value proposition. So it's a wonderful combination, Bob, of trade down and younger customers getting engaged. But again, whenever I talk about the consumer, at least for this quarter. The impact of the lower household income consumer growing in Canada was a real nice green shoot for us.

Jubran, you want to talk about the 2 markets, the Tennessee and North Carolina?

Jubran Tanious

Yes. I mean, earlier this year, we opened our first store in North Carolina. As Mark mentioned, opened our first store in Tennessee and Chattanooga and doing really well. And then we think there's a few reasons for that. Really 3 things I would point to, Bob.

The first thing is we've gotten better and better at site selection. And I think our success continues to bear that out. The second thing I would say is we have dedicated boots on the ground teams that are there to support young stores in their maturity curve and getting to profitability.

And then the third thing is an ever-evolving marketing playbook, a mix of tactics, whether that's influencers, paid search, optimizing the physical site itself. All those things taken together really help us ramp awareness and footsteps in a new market. So very pleased with what we've seen.

And I think one of the reasons that we're so encouraged is, frankly, the diversity of types of new markets that we've opened in. So Chattanooga to Harrisburg, Pennsylvania to Richmond, Virginia, we're seeing our model really do what we talked about earlier, durable, portable, lots of white space to take advantage of in the future.

Operator

Your next question comes from the line of Ike Boruchow with Wells Fargo.

Irwin Boruchow

Michael, quick one for you. On the margin algo you guys have, do you still expect on the 50 to 100 basis points of expansion? Do you still expect next year to be closer to the low end of that range? And assuming the answer to that is yes. What do you think is the #1 lever that you might see that might drive that answer more into the middle or higher range potentially of the algo?

Michael Maher

Yes. Short answer, yes. We still expect next year to be in the lower end, so let's call it, 50 basis points for 2027. And again, that's a function of the -- both the timing of the rollout of our innovation items, ThriftIQ, Autotagger and image capture and the continued maturation of new stores. So what could change that? I would say, probably, first and foremost, the total level of comp sales growth and the underlying organic leverage that we get on that, always going to be a driver, plus or minus of margin performance.

And then just how well do we see new stores performing? I would say the innovation time line, I think we've got that pretty locked down. We're on track for that. So probably your variables would be more around the comp, the level of comp growth and new store performance.

Operator

Your next question comes from the line of Anthony Chukumba with Capital Markets.

Anthony Chukumba

I guess with -- can you just give us, I guess, a little bit more color on the rollout of ThriftIQ in terms of the timing on that? If I recall last quarter, it was probably close to like 60 or so stores now it's in 108. And just wondering like how we should think about how the rollout is going to progress over the next 12 to 18 months?

Jubran Tanious

Yes. Anthony, it's Jubran. You're right about that. The rollout is going well. Consumer reaction has been strong. All the things that we mentioned earlier, we're on schedule. What we communicated and are executing on is it's going to hit our central processing centers first, which obviously allows you to hit effectively multiple stores at once. And then it will start to roll to the rest of the fleet sort of our traditional stores. So still on track for a full fleet rollout sometime in the early portion of 2028.

Operator

Your next question comes from the line of Peter Keith with Piper Sandler.

Sarah Morin

This is Sarah Morin on for Peter Keith. You said new store profitability is ramping ahead of your original expectations in part from ThriftIQ. Could you just walk through some other drivers of that? And then do you think some of the other innovations like the Autotagger and imaging technology could also contribute to further improvements there?

Jubran Tanious

Yes. This is Jubran. I can take a piece of that and you guys can jump in. So I think there's a few things coming together. ThriftIQ is absolutely a piece of that. It allows immature new store teams to ramp very quickly in terms of the precision of price like we've talked about in the past, shrinking your training time, allowing to ramp up faster. I think, again, some of the marketing tactics in terms of awareness, particularly in new markets have continued to improve and evolve and that is obviously helping us. I think the dedicated resources that we have sort of that boots on the ground, helping on the executional items that a new store faces helps them ramp faster, both in terms of donation volume and how we show up to the donor and that experience. But then also on the customer side of things with the shopping experience. So you put all that together and you really end up with what we're seeing.

Operator

Your next question comes from the line of Jeremy Hamblin with Craig-Hallum Capital Group.

Unknown Analyst

This is Will on for Jeremy. Just curious of the drivers of the stronger mix of on-site donations in the quarter. And if you can maybe speak to any differences in donation mix or sales yields between your newer versus the more mature stores or any differences between the U.S. and Canada markets?

Jubran Tanious

Thanks for the question. This is Jubran. So short answer on donation mix, no, not really, not seeing any material changes in the composition of what's donated.

In terms of the on-site donation growth itself, this has been sort of a recurring theme and we've talked about it in the past. We're seeing growth across multiple regions, multiple countries. And it really comes down to a variety of things, but particularly execution and showing up to the donor in a reliably fast, friendly and convenient way. And we put a lot of focus and effort on this. We know that if we do that well and do that consistently, we will remain the donation destination of choice for new donors. So as we look forward, we expect that to continue.

Michael Maher

And then, Will, this is Michael. Just to your second part of your question about new versus mature stores. Certainly, new stores have lower on-site donation penetration upfront. That is part of the maturation that is part of what helps ultimately move them to profitability. But typically, a new store opens with an on-site donation mix that's well below our fleet average.

Unknown Analyst

Understood. And then just wanted to go back to the ThriftIQ benefits. If you're able to add any more color on just how sell-through rates and sales yields or baskets compared to the kind of the remaining base that hasn't had ThriftIQ implemented yet?

Mark Walsh

Yes. The benefits are, as we've articulated, higher unit sell-through, absolutely larger baskets, the sales yields and profitabilities for those new stores are growing. Gross profit, very strong, couldn't be happier with the time line. And then lastly, benefits -- they're coming from both sales and gross margin dollars.

Operator

Your next question comes from the line of Owen Rickert with Northland Capital Markets.

Owen Rickert

Quick one for me. Just the store growth is accelerating in the U.S. this year. I was just curious how on-site donation supply is keeping pace in the newer, maybe less brand-aware markets like Tennessee and North Carolina.

Jubran Tanious

Yes, it's a great question, Owen. On-site donations have been right on plan, right as we modeled. So in accordance with what we would expect in terms of the overall maturity curve of a new store from a sales profitability and on-site donation volume perspective.

Operator

We have reached the end of the Q&A session. I will now turn the call back over to Mark Walsh for closing remarks.

Mark Walsh

Thank you, everyone, for participating today and your interest, your continued interest in Savers Value Village. And we're really looking forward to hosting everyone in Minneapolis next week. We look forward to seeing you there, travel safe you all. Thank you.

Operator

This concludes today's call. Thank you for attending. You may now disconnect.