BBB Foods (NYSE: TBBB) reported second-quarter fiscal 2026 revenue of 26 billion pesos, a 39% increase year-over-year. The Mexican hard-discount retailer posted strong operational momentum, with same-store sales rising 20% and adjusted EBITDA expanding 44% to 1.6 billion pesos.

The company continued its aggressive expansion strategy, opening 155 net new stores during the quarter to reach a total footprint of 3,624 locations as of June 30, 2026. Over the last 12 months, BBB Foods added 593 net new stores, representing a 20% growth in its store base compared to June 2025.

Financial Performance

Revenue growth was supported by both volume and price dynamics. Management disclosed that approximately two-thirds of the same-store sales growth stemmed from volume, while one-third resulted from price changes driven primarily by better product mix rather than inflation.

Adjusted EBITDA margin expanded by 21 basis points year-over-year. Excluding a one-time cash expense of 37 million pesos related to an equity follow-on offering in May 2026, the adjusted EBITDA margin stood at 6.2%.

Sales expenses as a percentage of revenue decreased by 56 basis points to 10% year-over-year, reflecting operating leverage in labor costs. Conversely, administrative expenses excluding share-based payments increased by 57 basis points, driven by investments in talent and expansion into new regions.

What the Numbers Show

The divergence between reported EBITDA (960 million pesos) and adjusted EBITDA (1.6 billion pesos) highlights the significant impact of non-cash share-based compensation on the company's bottom line. Additionally, the decline in sales expense ratio alongside rising administrative costs suggests a strategic shift where efficiency gains in store-level operations are being reinvested into corporate infrastructure and talent acquisition to support scaled growth.

Cash Flow and Working Capital

BBB Foods leveraged its structurally negative working capital model to generate robust cash flow. Operating cash flow for the first half of 2026 reached 4.3 billion pesos, marking a 119% increase compared to the first half of 2025.

As of June 2026, adjusted negative working capital reached 10.2 billion pesos, up from 7.1 billion pesos in 2025. Excluding IPO and follow-on proceeds, this figure represents approximately 11.2% of total last-twelve-months (LTM) revenue. Management noted that operating cash flow fully funds organic expansion, excluding capital raised through equity offerings.

Operational Updates

The retailer opened one new distribution center in Q2, expanding its network to 21 regions. CEO Anthony Hatum emphasized that gross margin improvements are driven by scale efficiencies in buying, manufacturing, and logistics. CFO Eduardo Pisuto added that transportation costs benefited from ongoing optimization efforts and better management of pre-operating expenses for the new distribution center.

Looking ahead, the company plans to open three additional distribution centers in Q3. Pisuto cautioned that this rapid infrastructure rollout might create temporary pressure on logistics expenses in the near term, though long-term efficiency is expected to improve.

The company remains focused on maintaining a conservative SKU count while selectively introducing new categories that demonstrate high rotation rates. Inventory days remain below 20 days, supporting the firm’s working capital discipline.

BBB Foods Inc. (NYSE: TBBB), operating as Tiendas 3B, delivered strong top-line growth in the second quarter of 2026, with total revenue reaching Ps. 26,037 million, a 38.7% increase from Ps. 18,770 million in the same period last year. This expansion was primarily driven by robust same-store sales growth of 20.0% and the addition of 155 net new stores during the quarter, bringing the company’s total store count to 3,624 as of June 30, 2026.

Despite the revenue surge, profitability metrics reflected significant non-cash charges. Reported EBITDA stood at Ps. 960 million, down marginally from Ps. 844 million in 2Q25, due largely to a Ps. 615 million share-based payment expense. Excluding this non-cash item, adjusted EBITDA climbed 43.8% year-over-year to Ps. 1,575 million, expanding its margin by 21 basis points to 6.1%.

Operational Highlights

The company continued its aggressive physical expansion strategy:

• Opened 155 net new stores in 2Q26, compared to 142 in 2Q25.
• Added one distribution center, reaching a total of 21 logistics facilities.
• Same-store sales growth accelerated to 20.0% from 17.7% in the prior-year quarter.

Gross profit increased 43.4% to Ps. 4,362 million, with gross margin expanding by 54 basis points to 16.8%. This improvement was attributed to stronger commercial margins and lower transportation costs as a percentage of revenue.

Financial Performance

Administrative expenses rose sharply by 95.3% to Ps. 1,428 million, driven by higher share-based compensation and staffing for new regional operations. Sales expenses grew 31.4% to Ps. 2,598 million but improved as a percentage of revenue by 56 basis points to 10.0%, indicating operational leverage.

The company recorded a net loss of Ps. 386 million for the quarter, widening from a Ps. 286 million loss in 2Q25. This deterioration was influenced by higher financial costs of Ps. 483 million and a Ps. 85 million foreign exchange loss on its U.S. dollar-denominated cash position.

What the Numbers Show

The divergence between reported EBITDA and adjusted EBITDA highlights the impact of equity compensation on bottom-line metrics. While operational cash flow generation remains strong—supported by a structurally negative working capital model—the Ps. 615 million share-based payment expense represents a substantial drag on reported earnings. Investors should note that this expense is already reflected in the fully diluted share count.

Cash flow from operations surged 119.2% to Ps. 4,285 million in the first half of 2026, fully funding the company’s organic expansion without external debt reliance. The company ended the period with Ps. 1,981 million in local currency cash and $236 million in U.S. dollar-denominated short-term deposits.