Overview
- Carter’s reported third-quarter net income of $11.6 million, down from $58.3 million a year earlier, with operating margin declining to 3.8%.
- The company estimates additional tariffs will add $200 million to $250 million in annual import costs after paying about $110 million in duties in fiscal 2024.
- About 150 low-margin stores across the U.S., Canada and Mexico will close over three years, with roughly 100 slated for fiscal 2025 and 2026 as leases expire.
- Approximately 300 office-based roles will be eliminated by the end of 2025, with expected annualized savings of about $35 million beginning in 2026 and one-time fourth-quarter charges of $4 million to $5 million.
- Carter’s is shifting sourcing to Vietnam, Cambodia, Bangladesh and India for roughly 75% of spend in fiscal 2025, reducing China to under 3%, and plans price increases, vendor cost-sharing and assortment changes.