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Aug 02, 2025
Children's Place Q2 2025 Earnings Report
Children’s Place reported a net loss in Q2 2025 but showed signs of recovery with positive comp sales in July.
Key Takeaways
The Children’s Place saw a decline in revenue and reported a net loss for Q2 2025, but improvements in back-to-school sales, inventory management, and transformation initiatives showed early signs of turnaround.
Revenue declined to $298 million, driven by lower traffic and store count.
Adjusted EPS was $(0.15), compared to $0.30 in Q2 2024.
Company achieved first positive comp sales month in over 18 months during July.
Inventory was reduced by $78 million year-over-year to improve free cash flow.
Forward Guidance
The company plans to invest in store openings, optimize costs, and strengthen wholesale partnerships despite macroeconomic headwinds and tariff uncertainty.
Positive Outlook
- First month of positive comp sales in July after 18 months of decline.
- Back-to-school sales momentum carried into August.
- Inventory reduced by $78 million year-over-year, improving cash flow.
- Transformation plan targeting $40 million in gross benefits over 3 years.
- Launch of new loyalty program in Q3 to boost customer retention.
Challenges Ahead
- Unfavorable macroeconomic environment continues to affect traffic.
- Additional $20–25 million in tariff and duty expenses projected for FY25.
- E-commerce and store traffic remain challenged year-over-year.
- Shift in channel mix continues to pressure gross margin.
Historical Earnings Impact
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Avg. Return Before/After Earnings
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