Carter's beats Q2 earnings expectations but forecasts decline in sales, facing challenges

From Nasdaq: 2024-07-29 13:35:00

Carter’s, Inc. reported second-quarter 2024 results with earnings of 76 cents per share beating estimates of 45 cents. Sales were soft at $564.4 million, missing estimates of $567 million. Margins improved with gross margin at 50.1% and adjusted operating margin at 7%. The company plans to open new stores and return capital to shareholders.

Looking ahead, Carter’s expects a decline in net sales and earnings for the third quarter and the full year 2024. Sales in the U.S. Retail segment are forecasted to decline, while the U.S. Wholesale segment is expected to see growth. The company faces challenges in International sales due to consumer demand pressures.

Carter’s has a cash balance of $316.6 million, long-term debt of $497.7 million, and shareholders’ equity of $811.8 million. The company returned $92.3 million to shareholders through buybacks and dividends in the first half of 2024, with $604 million remaining under its share repurchase authorization. Carter’s expects operating cash flow to exceed $200 million in 2024.

Investors have shown concerns, with CRI shares down 15.3% in the past three months compared to the industry decline of 16.2%. Despite challenges with sales in the U.S. Retail and International segments, the company is committed to optimizing its store fleet and testing new store models to boost performance.



Read more at Nasdaq: Carter’s (CRI) Q2 Earnings Beat, Retail Comps Down 11.7%