Q1 2025 Carter's Inc Earnings Call Transcript
Key Points
- Carter's Inc (CRI) achieved its first-quarter sales and earnings plan, with sales slightly higher than forecasted.
- The US retail segment, the largest part of the business, met its sales and earnings targets for the quarter.
- Strong sell-through of seasonal spring and summer products was observed, with the baby category achieving a 4% comp increase.
- April month-to-date comps in US retail are running up about 13%, indicating strong momentum.
- The company has a solid balance sheet with over $1 billion in liquidity and over $300 million in cash on hand.
- First-quarter results were below last year's performance, with a 5% decline in net sales compared to 2024.
- The gross margin declined by 140 basis points due to pricing investments in US retail and negative FX impacts.
- Operating income decreased from $55 million last year to $35 million this year, reflecting lower sales and pricing investments.
- The international segment posted a slight loss in the first quarter, impacted by unfavorable foreign currency exchange rates.
- Carter's Inc (CRI) suspended forward-looking guidance due to leadership transition and economic uncertainty related to proposed tariffs.
Welcome to Carter's first-quarter fiscal 2025 earnings conference call.
On the call are Doug Palladini, Chief Executive Officer and President; Richard Westenberger, Chief Financial Officer and Chief Operating Officer; Kendra Krugman, Chief Creative and Growth Officer; and Sean McHugh, Treasurer.
Please note that today's call is being recorded.
I'll now turn the call over to Mr. McHugh.
'-&
Thank you and good morning, everyone. We issued our first quarter 2025 earnings release earlier today. The release and presentation materials for today's call are available on our Investor Relations website at ir.carters.com. Note that statements on today's call about items such as the company's expectations and plans are forward-looking statements. For a discussion of factors that could cause actual results to vary from those contained in the forward-looking statements, please see our most recent SEC filings and the earnings release and
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