Operating margins have faced significant pressure, declining from 15.9% in 2023Q4 to 4.2% in 2026Q1, as the company struggles to offset rising costs through pricing power.
| Metric | TTM | Jan'26 | Dec'24 | Dec'23 | Dec'22 | Dec'21 | Dec'20 | Dec'19 | Dec'18 | Dec'17 | Dec'16 | Dec'15 | Dec'14 | Dec'13 | Dec'12 | Dec'11 | Dec'10 | Dec'09 | Dec'08 | Dec'07 | Dec'06 | Dec'05 | Dec'04 | Dec'03 | Dec'02 | Dec'01 | Dec'00 | Dec'99 | Dec'98 |
|---|
| Sales/Revenue | 2.95B | 2.9B | 2.84B | 2.95B | 3.21B | 3.49B | 3.02B | 3.52B | 3.46B | 3.4B | 3.2B | 3.01B | 2.89B | 2.64B | 2.38B | 2.11B | 1.75B | 1.59B | 1.49B | 1.41B | 1.34B | 1.12B | 823.12M | 703.83M | 579.55M | 518.51M | 471.37M | 414.6M | 408.18M |
| Revenue Growth % | 4.88% | 1.91% | -3.45% | -8.31% | -7.85% | 15.28% | -14.06% | 1.65% | 1.82% | 6.29% | 6.15% | 4.15% | 9.67% | 10.79% | 12.89% | 20.61% | 10.04% | 6.69% | 5.51% | 5.12% | 19.81% | 36.23% | 16.95% | 21.44% | 11.77% | 10% | 13.69% | 1.57% | - |
| Cost of Goods Sold | 1.63B | 1.58B | 1.48B | 1.55B | 1.74B | 1.82B | 1.71B | 2.01B | 1.96B | 1.92B | 1.82B | 1.76B | 1.71B | 1.54B | 1.44B | 1.42B | 1.11B | 985.32M | 976M | 929M | 854.97M | 725.09M | 525.08M | 448.54M | 352.15M | 332.21M | 293.34M | 271.84M | 257.67M |
| COGS % of Revenue | - | 54.64% | 52% | 52.61% | 54.17% | 52.32% | 56.57% | 57.13% | 56.75% | 56.38% | 56.89% | 58.26% | 59.07% | 58.49% | 60.62% | 67.24% | 63.62% | 61.98% | 65.5% | 65.78% | 63.64% | 64.66% | 63.79% | 63.73% | 60.76% | 64.07% | 62.23% | 65.57% | 63.13% |
| Gross Profit | 1.32B | 1.31B | 1.37B | 1.4B | 1.47B | 1.66B | 1.31B | 1.51B | 1.5B | 1.48B | 1.38B | 1.26B | 1.18B | 1.1B | 937.95M | 691.15M | 636.3M | 604.35M | 514.02M | 483.25M | 488.5M | 396.27M | 298.04M | 255.29M | 227.4M | 186.29M | 178.03M | 142.75M | 150.51M |
| Gross Margin % | 44.66% | 45.36% | 48% | 47.39% | 45.83% | 47.68% | 43.43% | 42.87% | 43.25% | 43.62% | 43.11% | 41.74% | 40.93% | 41.51% | 39.38% | 32.76% | 36.38% | 38.02% | 34.5% | 34.22% | 36.36% | 35.34% | 36.21% | 36.27% | 39.24% | 35.93% | 37.77% | 34.43% | 36.87% |
| Gross Profit Growth % | - | -3.7% | -2.2% | -5.19% | -11.43% | 26.56% | -12.93% | 0.74% | 0.96% | 7.55% | 9.63% | 6.21% | 8.13% | 16.78% | 35.71% | 8.62% | 5.29% | 17.57% | 6.37% | -1.07% | 23.27% | 32.96% | 16.75% | 12.26% | 22.06% | 4.64% | 24.72% | -5.16% | - |
| Operating Expenses | 1.18B | 1.17B | 1.11B | 1.07B | 1.09B | 1.17B | 1.12B | 1.14B | 1.11B | 1.06B | 952.59M | 865.17M | 851.1M | 831.23M | 675.96M | 503.69M | 468.19M | 434.39M | 378.52M | 483.97M | 323.3M | 275.03M | 197.01M | 180.65M | 166.83M | 154.56M | 137.51M | 127.9M | 123.09M |
| OpEx % of Revenue | - | 40.39% | 39.04% | 36.41% | 34.03% | 33.42% | 37.15% | 32.3% | 31.95% | 31.28% | 29.78% | 28.71% | 29.41% | 31.5% | 28.38% | 23.87% | 26.77% | 27.33% | 25.4% | 34.27% | 24.06% | 24.53% | 23.94% | 25.67% | 28.79% | 29.81% | 29.17% | 30.85% | 30.16% |
| Selling, General & Admin | 1.19B | 1.19B | 1.1B | 1.09B | 1.11B | 1.19B | 1.11B | 1.14B | 1.14B | 1.11B | 995.41M | 909.23M | 890.25M | 868.48M | 713.21M | 540.96M | 468.19M | 434.39M | 409.6M | 359.83M | 352.46M | 295.45M | 208.76M | 188.03M | 174.11M | 146.88M | 137.51M | 120.77M | 123.09M |
| SG&A % of Revenue | - | 41.02% | 38.51% | 37.14% | 34.55% | 34.24% | 36.56% | 32.41% | 33.07% | 32.55% | 31.11% | 30.17% | 30.76% | 32.91% | 29.95% | 25.64% | 26.77% | 27.33% | 27.49% | 25.48% | 26.24% | 26.35% | 25.36% | 26.72% | 30.04% | 28.33% | 29.17% | 29.13% | 30.16% |
| Research & Development | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| R&D % of Revenue | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - |
| Other Operating Expenses | -3M | -18.1M | 15.28M | -21.41M | -16.82M | -28.68M | 17.97M | -3.84M | -1.42M | 1.16M | -4.01M | 1.86M | -3.19M | -1.92M | -37.25M | -37.27M | 0 | 0 | -31.08M | 124.15M | -29.16M | -20.43M | -11.74M | -7.38M | -7.28M | 7.68M | 0 | 7.12M | 0 |
| Operating Income | 146.27M | 143.93M | 254.73M | 323.4M | 379.17M | 497.08M | 189.87M | 371.87M | 391.43M | 419.57M | 426.56M | 392.86M | 333.35M | 264.15M | 261.99M | 187.47M | 243.26M | 195.61M | 135.49M | -6.01M | 165.11M | 121.25M | 101.03M | 74.64M | 60.56M | 31.73M | 40.52M | 14.86M | 27.42M |
| Operating Margin % | 4.96% | 4.97% | 8.96% | 10.98% | 11.8% | 14.26% | 6.28% | 10.57% | 11.31% | 12.34% | 13.33% | 13.03% | 11.52% | 10.01% | 11% | 8.89% | 13.91% | 12.31% | 9.09% | -0.43% | 12.29% | 10.81% | 12.27% | 10.6% | 10.45% | 6.12% | 8.6% | 3.58% | 6.72% |
| Operating Income Growth % | - | -43.5% | -21.24% | -14.71% | -23.72% | 161.8% | -48.94% | -5% | -6.71% | -1.64% | 8.58% | 17.85% | 26.19% | 0.83% | 39.75% | -22.93% | 24.36% | 44.37% | 2354.85% | -103.64% | 36.18% | 20.02% | 35.35% | 23.24% | 90.85% | -21.69% | 172.78% | -45.83% | - |
| EBITDA | 188.32M | 199.2M | 312.65M | 387.54M | 444.45M | 591.19M | 283.87M | 467.83M | 481.09M | 503.98M | 500M | 461.26M | 408.27M | 332.65M | 301.83M | 220.01M | 274.98M | 227.89M | 166.8M | 25.07M | 193.95M | 159.86M | 122.36M | 98.92M | 81.02M | 50.9M | 58.04M | 33.3M | 44.63M |
| EBITDA Margin % | 6.38% | 6.87% | 10.99% | 13.16% | 13.83% | 16.96% | 9.39% | 13.29% | 13.9% | 14.82% | 15.63% | 15.3% | 14.11% | 12.61% | 12.67% | 10.43% | 15.72% | 14.34% | 11.19% | 1.78% | 14.44% | 14.26% | 14.87% | 14.05% | 13.98% | 9.82% | 12.31% | 8.03% | 10.93% |
| EBITDA Growth % | -33.25% | -36.29% | -19.32% | -12.8% | -24.82% | 108.26% | -39.32% | -2.76% | -4.54% | 0.8% | 8.4% | 12.98% | 22.73% | 10.21% | 37.19% | -19.99% | 20.67% | 36.63% | 565.33% | -87.07% | 21.33% | 30.64% | 23.7% | 22.1% | 59.18% | -12.31% | 74.29% | -25.38% | - |
| D&A (Non-Cash Add-back) | 42.04M | 55.26M | 57.93M | 64.14M | 65.28M | 94.11M | 94M | 95.95M | 89.65M | 84.41M | 73.44M | 68.4M | 74.92M | 68.5M | 39.85M | 32.55M | 31.73M | 32.27M | 31.3M | 31.08M | 28.84M | 38.61M | 21.34M | 24.28M | 20.45M | 19.16M | 17.52M | 18.45M | 17.2M |
| EBIT | 118.89M | 148.06M | 285.56M | 336.21M | 359.52M | 498.58M | 234.9M | 365.57M | 390.54M | 419.25M | 422.48M | 392.86M | 330.56M | 262.9M | 262.16M | 188.42M | 243.83M | 195.83M | 141.49M | -724K | 165.2M | 128.07M | 101.64M | 74.64M | 60.56M | 31.73M | 40.52M | 14.86M | 27.42M |
| Net Interest Income | -16.08M | -20.75M | -20.29M | -29.2M | -41.52M | -59.2M | -54.55M | -36.31M | -34.04M | -29.7M | -26.48M | -26.53M | -27.25M | -12.77M | -6.53M | -7.16M | -9.87M | -11.79M | -18.09M | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Interest Income | 7.08M | 13.47M | 11.04M | 4.78M | 1.26M | 1.1M | 1.51M | 1.3M | 527K | 345K | 563K | 500K | 403K | 669K | 234K | 386K | 575K | 0 | 1.49M | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Interest Expense | 38.17M | 34.23M | 31.33M | 33.97M | 42.78M | 60.29M | 56.06M | 37.62M | 34.57M | 30.04M | 27.04M | 27.03M | 27.65M | 13.44M | 6.76M | 7.53M | 10.45M | 11.79M | 19.58M | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Other Income/Expense | -33.93M | -30.1M | -23.92M | -21.16M | -62.44M | -58.79M | -54.88M | -43.92M | -35.46M | -28.54M | -30.49M | -24.67M | -30.44M | -14.69M | -6.59M | -6.58M | -9.87M | -11.79M | -18.09M | -23.08M | -26.92M | -43.38M | -18.52M | -35.71M | -28.3M | -35.35M | -18.68M | -20.44M | -21.21M |
| Pretax Income | 112.34M | 113.83M | 230.81M | 302.24M | 316.74M | 438.29M | 134.98M | 327.95M | 355.98M | 391.03M | 396.07M | 368.19M | 302.91M | 249.47M | 255.39M | 180.89M | 233.39M | 183.83M | 117.41M | -29.09M | 138.19M | 77.87M | 82.51M | 38.93M | 32.26M | 8.9M | 21.84M | -5.58M | 6.21M |
| Pretax Margin % | 3.81% | 3.93% | 8.12% | 10.26% | 9.86% | 12.57% | 4.46% | 9.32% | 10.28% | 11.5% | 12.38% | 12.22% | 10.47% | 9.45% | 10.72% | 8.57% | 13.34% | 11.56% | 7.88% | -2.06% | 10.29% | 6.94% | 10.02% | 5.53% | 5.57% | 1.72% | 4.63% | -1.35% | 1.52% |
| Income Tax | 21.75M | 22.04M | 45.3M | 69.74M | 66.7M | 98.54M | 25.27M | 64.15M | 73.91M | 88.27M | 137.96M | 130.37M | 108.24M | 89.06M | 94.24M | 66.87M | 86.91M | 68.19M | 42.35M | 41.53M | 50.97M | 30.66M | 32.85M | 15.65M | 13.01M | 5.41M | 8.84M | -1.78M | 2.7M |
| Effective Tax Rate % | 19.36% | 19.36% | 19.63% | 23.07% | 21.06% | 22.48% | 18.72% | 19.56% | 20.76% | 22.57% | 34.83% | 35.41% | 35.73% | 35.7% | 36.9% | 36.97% | 37.24% | 37.09% | 36.07% | -142.77% | 36.88% | 39.38% | 39.81% | 40.2% | 40.33% | 60.8% | 40.45% | 31.92% | 43.45% |
| Net Income | 90.59M | 91.8M | 185.51M | 232.5M | 250.04M | 339.75M | 109.72M | 263.8M | 282.07M | 302.76M | 258.11M | 237.82M | 194.67M | 160.41M | 161.15M | 114.02M | 146.47M | 115.64M | 75.06M | -70.62M | 87.22M | 47.2M | 49.66M | 23.28M | 19.25M | -4.16M | 12.65M | -3.8M | 3.51M |
| Net Margin % | 3.07% | 3.17% | 6.52% | 7.89% | 7.78% | 9.74% | 3.63% | 7.5% | 8.15% | 8.9% | 8.07% | 7.89% | 6.73% | 6.08% | 6.77% | 5.4% | 8.37% | 7.27% | 5.04% | -5% | 6.49% | 4.21% | 6.03% | 3.31% | 3.32% | -0.8% | 2.68% | -0.92% | 0.86% |
| Net Income Growth % | -44.43% | -50.52% | -20.21% | -7.01% | -26.4% | 209.66% | -58.41% | -6.48% | -6.84% | 17.3% | 8.53% | 22.17% | 21.36% | -0.46% | 41.34% | -22.16% | 26.66% | 54.07% | 206.29% | -180.97% | 84.78% | -4.95% | 113.33% | 20.91% | 562.92% | -132.87% | 432.97% | -208.26% | - |
| Net Income (Continuing) | 90.59M | 91.8M | 185.51M | 232.5M | 250.04M | 339.75M | 109.72M | 263.8M | 282.07M | 302.85M | 257.71M | 237.82M | 194.67M | 160.41M | 161.15M | 114.02M | 146.47M | 115.64M | 77.9M | -70.62M | 87.22M | 47.2M | 49.66M | 23.28M | 19.25M | -4.16M | 13.01M | -3.8M | 3.51M |
| Discontinued Operations | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Minority Interest | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| EPS (Diluted) | 2.56 | 2.59 | 5.12 | 6.24 | 6.34 | 7.81 | 2.50 | 5.85 | 6.05 | 6.24 | 5.08 | 4.50 | 3.62 | 2.75 | 2.69 | 1.94 | 2.46 | 1.97 | 1.33 | -1.22 | 1.42 | 0.78 | 0.83 | 0.46 | 0.41 | -0.09 | 0.26 | -0.08 | 0.07 |
| EPS Growth % | -43.89% | -49.41% | -17.95% | -1.58% | -18.82% | 212.4% | -57.27% | -3.31% | -3.04% | 22.83% | 12.89% | 24.31% | 31.64% | 2.23% | 38.66% | -21.14% | 24.87% | 48.12% | 209.02% | -185.92% | 82.05% | -6.02% | 80.43% | 12.2% | 571.81% | -133.42% | 429.53% | -208.23% | - |
| EPS (Basic) | - | 2.59 | 5.12 | 6.24 | 6.34 | 7.83 | 2.51 | 5.89 | 6.11 | 6.31 | 5.13 | 4.55 | 3.65 | 2.78 | 2.73 | 1.96 | 2.50 | 2.03 | 1.37 | -1.22 | 1.50 | 0.82 | 0.88 | 0.50 | 0.43 | -0.09 | 0.28 | -0.08 | 0.08 |
| Diluted Shares Outstanding | 35.44M | 35.44M | 35.53M | 36.59M | 38.85M | 43M | 43.41M | 44.71M | 46.65M | 48.15M | 50.38M | 52.33M | 53.09M | 57.52M | 59.07M | 58.21M | 59.02M | 58.7M | 58.28M | 57.87M | 61.25M | 60.75M | 59.86M | 50.37M | 47.09M | 47.89M | 48.17M | 48.17M | 48.17M |
| Basic Shares Outstanding | 35.44M | 35.44M | 35.52M | 36.59M | 38.82M | 42.85M | 43.24M | 44.4M | 46.16M | 47.59M | 49.92M | 51.84M | 52.61M | 56.93M | 58.22M | 57.51M | 58.14M | 56.97M | 56.31M | 57.87M | 58M | 57.28M | 56.25M | 47.22M | 44.91M | 46.21M | 45.12M | 45.12M | 45.12M |
| Dividend Payout Ratio | - | 61.4% | 62.63% | 48.17% | 47.24% | 17.7% | 23.93% | 33.96% | 29.68% | 23.42% | 25.71% | 19.35% | 20.79% | 17.28% | - | - | - | - | - | - | - | - | - | 106.94% | - | - | - | - | - |
Operating margin compression
According to recent financial filings, Carter's revenue growth has fluctuated significantly, posting an 8.1% increase in 2026Q1 following a period of stagnation, which suggests that the company's reliance on seasonal wholesale cycles creates volatility that masks underlying demand trends in the core infant apparel market.
The inconsistent revenue trajectory indicates that the company may be struggling to maintain organic growth amidst a challenging domestic retail environment. Investors should monitor whether the recent uptick in 2026Q1 represents a sustainable recovery or merely a timing shift in wholesale shipments to mass-market partners.
As reported in quarterly statements, Carter's gross margin has compressed from 48.7% in 2023Q4 to 43.1% in 2026Q1, reflecting a persistent inability to fully offset rising sourcing costs and promotional activity through pricing power within its competitive mass-market distribution channels.
The consistent decline in gross margins suggests that the brand's pricing power may be weakening as it competes for shelf space in a crowded retail landscape. This trend warrants further investigation into whether the company is forced to rely on deeper markdowns to clear seasonal inventory.
Based on the provided income statement data, operating margins have deteriorated sharply from 15.9% in 2023Q4 to 4.2% in 2026Q1, indicating that the company's fixed cost structure is not scaling efficiently with revenue, thereby limiting the potential for bottom-line expansion during periods of growth.
The inability to maintain operating leverage suggests that SG&A expenses are consuming a disproportionate share of gross profit, likely due to the maintenance of a legacy retail footprint. This may imply that the company's current operational model is becoming increasingly expensive to support relative to its output.
Data from recent periods reveals that net income margins have plummeted to 2.1% in 2026Q1, a stark contrast to the 12.4% reported in 2023Q4, which suggests that the company's profitability is highly vulnerable to even minor fluctuations in top-line performance or operational cost management.
Short-sellers would likely focus on the rapid deterioration of net margins as evidence that the company's wholesale-heavy model is losing its competitive edge. The current trend suggests that the company may be approaching a point where its operational costs could permanently impair its ability to generate meaningful shareholder returns.
Quick answers to the most common questions about buying CRI stock.
For fiscal year 2025, Carter's, Inc. (CRI) reported total revenue of $2.90B. This represents a 610.1% increase compared to $408.2M in 1998.
Carter's, Inc. (CRI) is profitable, generating $91.8M in net income for the fiscal year ending 2025 with a net profit margin of 3.2%.
Carter's, Inc. (CRI) reported an operating income of $143.9M, resulting in an operating profit margin of 5.0%. This margin reflects the operational efficiency of the business before interest and taxes.
Carter's, Inc. (CRI) generated $1.31B in gross profit for the year, representing a gross profit margin of 45.4%. This demonstrates the company's core pricing power and production efficiency.