Carter's Q1 2025 Earnings Call: Unpacking Contradictions in E-Commerce Growth, Pricing Strategies, and Retail Challenges
Earnings DecryptTuesday, May 13, 2025 3:01 pm ET
2min read
E-commerce growth and impact, pricing strategy and market aggressiveness, international sales growth and targets, e-commerce sales and growth strategy, retail challenges and strategy are the key contradictions discussed in Carter's latest 2025Q1 earnings call.
Revenue and Earnings Performance:
- Carter's, Inc. reported net income of $46.4 million for Q1 2025, compared to $46.6 million in the prior year, indicating a slight year-over-year decline.
- The revenue for Q1 2025 was $1.4 billion, representing a 2.9% decrease from the previous year.
- The decrease in revenue was primarily due to a decrease in comparable sales and reduced customer traffic in stores.
Comparable Sales and Store Traffic:
- Carter's reported a decline in comparable sales of 2.9% for Q1 2025 compared to Q1 2024.
- The company saw a reduction in customer traffic in its stores, which contributed to the decline in comparable sales.
- These declines were attributed to ongoing macroeconomic challenges and increased promotional activity.
Cost Management and Gross Margin:
- The company's gross margin improved to 45.2% for Q1 2025, compared to 44.4% in Q1 2024.
- The improvement in gross margin was driven by a reduction in promotional activity and the impact of past price increases.
- Despite the margin improvement, Carter's faced higher supply chain and sourcing costs, which offset some of the gains.
Inventory and Asset Optimization:
- Carter's ended the quarter with an inventory balance of $472 million, down 5.6% year-over-year.
- The company continues to focus on optimizing its inventory levels to align with demand, which has led to a reduction in excess inventory.
- This reduction in inventory is part of a broader strategy to improve operational efficiency and profitability.
![]()
Revenue and Earnings Performance:
- Carter's, Inc. reported net income of $46.4 million for Q1 2025, compared to $46.6 million in the prior year, indicating a slight year-over-year decline.
- The revenue for Q1 2025 was $1.4 billion, representing a 2.9% decrease from the previous year.
- The decrease in revenue was primarily due to a decrease in comparable sales and reduced customer traffic in stores.
Comparable Sales and Store Traffic:
- Carter's reported a decline in comparable sales of 2.9% for Q1 2025 compared to Q1 2024.
- The company saw a reduction in customer traffic in its stores, which contributed to the decline in comparable sales.
- These declines were attributed to ongoing macroeconomic challenges and increased promotional activity.
Cost Management and Gross Margin:
- The company's gross margin improved to 45.2% for Q1 2025, compared to 44.4% in Q1 2024.
- The improvement in gross margin was driven by a reduction in promotional activity and the impact of past price increases.
- Despite the margin improvement, Carter's faced higher supply chain and sourcing costs, which offset some of the gains.
Inventory and Asset Optimization:
- Carter's ended the quarter with an inventory balance of $472 million, down 5.6% year-over-year.
- The company continues to focus on optimizing its inventory levels to align with demand, which has led to a reduction in excess inventory.
- This reduction in inventory is part of a broader strategy to improve operational efficiency and profitability.
Disclaimer: The news articles available on this platform are generated in whole or in part by artificial intelligence and may not have been reviewed or fact checked by human editors. While we make reasonable efforts to ensure the quality and accuracy of the content, we make no representations or warranties, express or implied, as to the truthfulness, reliability, completeness, or timeliness of any information provided. It is your sole responsibility to independently verify any facts, statements, or claims prior to acting upon them. Ainvest Fintech Inc expressly disclaims all liability for any loss, damage, or harm arising from the use of or reliance on AI-generated content, including but not limited to direct, indirect, incidental, or consequential damages.
Comments
No comments yet