The children's and toddler's apparel clothing store Carter's is closing over 100 stores and intends on laying off 300 positions.
The plan was described in a recent company report , which detailed a steep drop in earnings during the third quarter.
One of the concerns mentioned in Carter's report was its diluted earning per share which fell to $0.32, a sharp decrease from $1.62 in the third quarter of 2024.
The operating margin also plummeted from 10.2% to 3.8%, a decline the company attributed to higher tariffs and various investments.
"While we are steadying our business in 2025, there's still meaningful work to do for Carter's to unlock its full potential in terms of exceeding both consumer and shareholder expectations‚" Carter's CEO Douglas Palladini said in a statement. "Our team is acting decisively to improve the Company's financial performance."
Part of the company's plan to save money is to close approximately 150 low-margin retail stores across North America as their leases expire over the next three years, the company said. Roughly 100 stores are targeted for closure during the 2025 and 2026 fiscal periods.
The 150 stores slated to close represent about $110 million in annual net sales. Carter's expected these closures to help in creating overall profitability by eliminating fixed expenses and transferring sales to other stores or online.
The retailer also plans to eliminate around 300 office-based roles, representing about 15% of the corporate workforce, by the end of this year, Carter's said in its report. The layoffs are expected to yield annualizing savings of approximately $35 million beginning in 2026.
In a show of commitment to the cost-cutting strategy, Carter's board of directors and CEO announced they will reduce their own 2026 compensation.
"Our multi-channel business model affords Carter's brands unparalleled availability and awareness, and deep consumer trust built over our 160-year legacy enables our position as the young children's apparel market leader," Palladini said. "I'm confident our new product, marketing, and consumer experience initiatives, which have begun to bear fruit, will further strengthen our market position in the years ahead."
Carter's, which includes the Oshkosh B'gosh brand, has more than 1,000 company-operated stores in North America, with products also sold in department stores and online.
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