Caleres 2026 Q2 Earnings Net Income Plummets 76.7% Amid Revenue Decline

Caleres (CAL) reported its fiscal 2026 Q2 earnings on Sep 04th, 2025, with both revenue and net income falling short of prior-year levels. The company delivered a 3.6% year-over-year decline in total revenue and a 76.7% drop in net income, underscoring continued cost pressures and market headwinds.

Revenue
Caleres reported total revenue of $658.52 million in Q2 2026, down from $683.32 million in Q2 2025. The decline was driven by weaker performance across segments, with Famous Footwear and Brand Portfolio segments reporting mixed results. The Famous Footwear segment contributed $399.59 million, while the Brand Portfolio generated $275.62 million. Eliminations and Other accounted for a negative $16.69 million, highlighting ongoing operational adjustments. The segment results reflect broader industry challenges, including margin pressures and shifting consumer preferences.

Earnings/Net Income
Net income for Caleres fell to $7.06 million in Q2 2026, a 76.7% decrease from $30.27 million in Q2 2025. Earnings per share (EPS) also took a sharp hit, declining 76.5% to $0.20 from $0.85 a year ago. The EPS drop underscores the severity of margin compression and cost-related challenges facing the company. Despite these setbacks, the company remains focused on long-term strategic goals, including cost savings and operational efficiency.

Post-Earnings Price Action Review
Following the earnings report, Caleres’ stock experienced mixed short-term performance. Shares surged 10.82% during the latest trading day but fell 8.13% over the full trading week, with a 2.67% gain month-to-date. The volatile reaction reflects investor uncertainty about the company’s ability to navigate current challenges while maintaining growth in core segments.

John Schmidt, President, CEO & Director, outlined key themes from the quarter, including continued resilience amid market uncertainty and strong sales trends in both the Brand Portfolio and Famous Footwear segments. He highlighted gains in women's fashion footwear and the strength of direct-to-consumer and international channels for key brands such as Sam Edelman and Allen Edmonds. However, gross margin pressures from tariffs and inventory costs continued to weigh on profitability. The company emphasized strategic priorities such as tariff mitigation, structural cost savings, and the integration of Stuart Weitzman, which is expected to generate long-term efficiency gains.

For the Brand Portfolio, gross margins are expected to decline similarly to Q2’s 240 basis points in Q3, with improvement anticipated in Q4 as tariff mitigation efforts take effect. In Famous Footwear, August delivered a 1% comp, and Q3 sales for September and October are projected to decline low single digits, impacted by BOGO promotions. Meanwhile, structural cost savings initiatives will continue to deliver benefits in 2026. Jack Calandra noted that the Stuart Weitzman acquisition is expected to contribute to interest expense at a rate of approximately 5.7-5.8% on $120 million in borrowing.

Additional News
In recent news, several developments have shaped Caleres’ strategic and operational landscape. The company’s leadership has remained stable, with John Schmidt continuing to emphasize long-term value creation and resilience in a challenging market. Additionally, Caleres has maintained a disciplined approach to cost management and inventory optimization, with ongoing efforts to mitigate the impact of tariffs and global supply chain challenges. The company has also seen growth in its direct-to-consumer and international channels, which have become increasingly important in driving brand engagement and revenue. As the footwear industry continues to evolve, Caleres is focused on leveraging its brand strength, operational flexibility, and strategic investments to position itself for future growth.