Overview

• U.S. children's apparel retailer's fiscal Q1 sales fell 11% on lower DTC traffic and wholesale cuts

• Adjusted EPS loss widened to $2.00 from $1.52 a year ago

• Gross margin contracted due to higher tariffs, distribution costs, and markdowns

Outlook

• Company expects tariff refund claims to partially offset margin dilution during fiscal 2026

• Children's Place targets $60 mln in gross annualized cost reductions by fiscal 2027

Result Drivers

• LOWER DTC TRAFFIC - Sales decline driven by lower direct-to-consumer traffic as company works to stabilize customer file

• WHOLESALE SHIPMENT CUTS - Planned reduction in wholesale shipments to align inventories with demand weighed on sales

• GROSS MARGIN PRESSURE - Gross margin fell due to higher tariff costs, a one-time distribution facility exit charge, and higher markdowns

Company press release: ID:nGNX4NZHdf

Key Details

Metric	Beat/Miss	Actual	Consensus Estimate
Q1 Sales		$215.20 mln
Q1 Adjusted EPS		-$2
Q1 EPS		-$2.40
Q1 Adjusted Net Income		-$44.30 mln
Q1 Net Income		-$53.20 mln
Q1 Adjusted Gross Margin		26.80%

Analyst Coverage

• The one available analyst rating on the shares is "hold"

• The average consensus recommendation for the apparel & accessories retailers peer group is "buy."

• Wall Street's median 12-month price target for Children's Place Inc is $4.00, about 11.4% above its June 11 closing price of $3.59

For questions concerning the data in this report, contact Estimates.Support@lseg.com. For any other questions or feedback, contact reuters.support@thomsonreuters.com.