CRI

EX-99.1

2 cri-ex991q32026.htm

EX-99.1

Document

EXHIBIT 99.1

Contact:

T.C. Robillard

Vice President, Investor Relations

tc.robillard@carters.com

Carter’s, Inc. Reports Third Quarter Fiscal 2026 Results

•Net sales $752 million vs. $758 million in Q3 2025, decrease of 0.7%

•U.S. Retail comparable sales increased 0.4%

•Operating income $56 million vs. $29 million in Q3 2025

•Adjusted operating income $57 million vs. $39 million in Q3 2025, growth of 45%

•Diluted EPS $1.00 vs. $0.32 in Q3 2025

•Adjusted diluted EPS $1.03 vs. $0.74 in Q3 2025, growth of 39%

•Returned $27 million to shareholders through dividends in the first three quarters of fiscal 2026

•Announced strategic evolution of leadership structure; see separate press release issued today

•Updates full year 2026 outlook

ATLANTA, October 30, 2026 — Carter’s, Inc. (NYSE:CRI), North America’s largest and most-enduring apparel company exclusively for babies and young children, today reported its third quarter fiscal 2026 results.

“I am pleased with the significant progress of the company’s profitability improvement initiatives in the third quarter, especially in light of delivering slight growth in U.S. Retail comparative sales and overall net sales that were slightly above our outlook amid an uneven macroeconomic environment. As the quarter unfolded, the U.S. Retail team quickly and effectively worked to adjust our marketing and promotional efforts in response to the challenges to help deliver these results. Our solid third quarter performance is currently expected to contribute to another year of growth in net sales, U.S. Retail comparable sales, and operating profit for fiscal 2026, even as we moderate our revenue outlook to reflect the continued pressure on our consumers from the ongoing economic and geopolitical uncertainty,” said Sharon Price John, Chief Executive Officer & President. “Separately, over the past several months in my new role, we have continued to define a strategic framework based on our tenets of keeping the consumer at the center of all that we do, leveraging the power of our market-leading brands, and utilizing our meaningful data and insights to drive innovation and decision making while staying focused on delivering profitable sales. Indicative of our intent to take significant and rapid steps to improve the business, for the first time in 25 years, during the quarter we successfully launched a comprehensive initiative for our

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flagship Carter’s brand, including a reimagined logo and brand promise of “let every child's light shine”, with the goal of increasing appeal and relevance to today’s generation of parents. Separately, we announced the evolution of our leadership structure designed to increase synergy, improve processes, and better align with our go-forward strategy. While early, I’m encouraged by our progress and believe we are well positioned to continue to unlock this iconic company's potential to deliver meaningful shareholder returns over time,” Ms. John concluded.

Adjustments to Reported GAAP Results

In addition to the results presented in this earnings release in accordance with GAAP, the Company has provided adjusted, non-GAAP financial measurements, as presented below. The Company believes these non-GAAP financial measurements provide a meaningful comparison of the Company’s results and afford investors a view of what management considers to be the Company’s core performance. These measures are presented for informational purposes only. See “Reconciliation of Adjusted Results to GAAP” section of this release for additional disclosures and reconciliations regarding these non-GAAP financial measures.

Third quarter fiscal 2026 results included expenses associated with intellectual property litigation costs. Results for the first three quarters of fiscal 2026 included a benefit related to the receipt of a refund of previously paid import duties and related interest as well as expenses associated with leadership transition and intellectual property litigation costs. Third quarter and the first three quarters of fiscal 2025 results included expenses related to organizational restructuring initiatives, operating model improvement costs, leadership transition costs, a non-cash charge for settlement of the OshKosh B’Gosh Pension Plan, and a tax charge associated with the termination of the Company’s deferred compensation plan.

Third Fiscal Quarter

20262025

(In millions, except earnings per share)Operating Income% Net SalesNet IncomeDiluted EPSOperating Income% Net SalesNet IncomeDiluted EPS

As reported (GAAP)$55.8 7.4 %$36.6 $1.00 $29.1 3.8 %$11.6 $0.32

IP litigation1.2 0.9 0.02 — — —

Organizational restructuring— — — 6.1 4.6 0.13

Operating model improvement costs— — — 3.7 2.8 0.08

Leadership transition costs— — — 0.5 0.4 0.01

Pension plan settlement— — — — 6.7 0.18

Deferred compensation plan termination— — — — 0.8 0.02

As adjusted$56.9 7.6 %$37.5 $1.03 $39.4 5.2 %$26.8 $0.74

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Firs

EX-99.1

2 cri-ex991q22026.htm

EX-99.1

Document

EXHIBIT 99.1

Contact:

T.C. Robillard

Vice President, Investor Relations

tc.robillard@carters.com

Carter’s, Inc. Reports Second Quarter Fiscal 2026 Results

•Net sales $615 million vs. $585 million in Q2 2025; growth of 5%

•U.S. Retail comparable sales increased 5.1%

•Operating income $140 million vs. $4 million in Q2 2025; Adjusted operating income $18 million vs. $12 million in Q2 2025, growth of 54%

•Diluted EPS $2.87 vs. $0.01 in Q2 2025; Adjusted diluted EPS $0.26 vs. $0.17 in Q2 2025, growth of 53%

•Received $132 million ($100 million after-tax) recovery of previously paid import duties and related interest

•Returned $18 million to shareholders through dividends in the first half of fiscal 2026

•Updates full year 2026 outlook

ATLANTA, July 31, 2026 — Carter’s, Inc. (NYSE:CRI), North America’s largest and most-enduring apparel company exclusively for babies and young children, today reported its second quarter fiscal 2026 results.

“Demonstrating continued momentum, the Company posted positive results for the quarter as net sales increased 5% and adjusted operating profit increased 54%, exceeding the prior outlook. While there were a number of moving parts in the quarter, we believe these results are largely reflective of improved marketing efforts, the early benefit of productivity initiatives, and continued progress in the critical Baby segment,” said Sharon Price John, Chief Executive Officer & President. “Separately, having recently joined the organization, I look forward to leading this historic company into its next exciting chapter. Carter’s is the market share leader in its category fueled by a well-established, diversified business model and powerful assets including its iconic brands, providing a wealth of opportunity to unlock value, drive profitable growth and deliver meaningful shareholder returns.”

Adjustments to Reported GAAP Results

In addition to the results presented in this earnings release in accordance with GAAP, the Company has provided adjusted, non-GAAP financial measurements, as presented below. The Company believes these non-GAAP financial measurements provide a meaningful comparison of the Company’s results and afford investors a view of what management considers to be the Company’s underlying performance. These

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measures are presented for informational purposes only. See “Reconciliation of Adjusted Results to GAAP” section of this release for additional disclosures and reconciliations regarding these non-GAAP financial measures.

Second quarter and first half fiscal 2026 results included a benefit related to the receipt of a refund of previously paid import duties and related interest as well as expenses associated with leadership transition and intellectual property litigation costs. Second quarter and first half fiscal 2025 results included expenses related to operating model improvement initiatives and leadership transition costs.

Second Fiscal Quarter

20262025

(In millions, except earnings per share)Operating Income% Net SalesNet IncomeDiluted EPSOperating Income% Net SalesNet IncomeDiluted EPS

As reported (GAAP)$139.8 22.7 %$105.0 $2.87 $4.0 0.7 %$0.4 $0.01

Tariff refund recovery (127.7)(100.1)(2.73)— — —

Leadership transition costs4.7 3.6 0.10 1.1 0.8 0.02

IP litigation1.2 0.9 0.03 — — —

Operating model improvement costs— — — 6.6 5.0 0.14

As adjusted$18.1 2.9 %$9.4 $0.26 $11.8 2.0 %$6.3 $0.17

First Half

20262025

(In millions, except earnings per share)Operating Income% Net SalesNet IncomeDiluted EPSOperating Income% Net SalesNet IncomeDiluted EPS

As reported (GAAP)$168.3 13.0 %$119.3 $3.26 $30.1 2.5 %$16.0 $0.43

Tariff refund recovery (127.7)(100.1)(2.73)— — —

Leadership transition costs4.7 3.6 0.10 7.2 6.6 0.18

IP litigation1.2 0.9 0.03 — — —

Operating model improvement costs— — — 9.8 7.4 0.21

As adjusted$46.5 3.6 %$23.7 $0.65 $47.1 3.9 %$30.1 $0.83

Note: Results may not be additive due to rounding.

Consolidated Results

Second Quarter of Fiscal 2026 compared to Second Quarter of Fiscal 2025

Net sales increased $30.2 million, or 5.2%, to $615.5 million, compared to $585.3 million in the second quarter of fiscal 2025, reflecting growth in each segment. Net sales in the U.S. Wholesale, U.S. Retail, and International segments grew 11.7%, 1.7%, and 2.7%, respectively. U.S. Retail comparable net sales increased 5.1%. Changes in foreign currency exchange rates used for translation had a favorable effect on consolidated net sales of approximately $2.4 million, or 0.4% in the second quarter of fiscal 2026, as compared to the second quarter of fiscal 2025.

Operating income increased $135.8 million to $139.8 million, compared to $4.0 million in the second quarter of fiscal 2025, reflecting a recovery of previously paid import duties and benefits from productivity and supply chain initiatives, partially offset by net incremental tariff costs, investments in demand creation, general infl

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