The net sales for the quarter ended May 2, 2026, stood at $270.7 million, compared with $277.7 million in Q1 of FY25. Comparable store sales declined 2.1 per cent during the quarter.
Shoe Carnival has reported lower Q1 FY26 net sales of $270.7 million as both Shoe Carnival and Shoe Station banners declined during a strategic transition.
The gross margin fell to 33.3 per cent, and the company posted a GAAP net loss of $5.6 million after transition and rebanner review charges.
It ended debt-free with $129 million in cash and reaffirmed FY26 guidance.
“Since returning to the chief executive officer role in late February, I have worked with our Board and management team to complete a comprehensive review of the Company’s strategic direction and capital deployment,” said Cliff Sifford, interim president and CEO at Shoe Carnival.
He added that the review confirmed Shoe Carnival and Shoe Station serve distinct consumer segments and that the company is best positioned to operate both banners as permanent, independent components of its portfolio.
The company reported a gross profit margin of 33.3 per cent, down from 34.5 per cent in the corresponding quarter of the previous year. Merchandise margin declined 140 basis points, mainly due to increased promotional activity and higher e-commerce-related shipping costs. This was partly offset by lower buying, distribution and occupancy costs.
It recorded a GAAP net loss of $5.6 million, or $0.21 per diluted share, compared with net income of $9.3 million, or $0.34 per diluted share, in Q1 2025, Shoe Carnival said in a press release.
The company recorded pretax charges of $13.6 million during the quarter, comprising $5.3 million related to the chief executive officer transition and $8.3 million linked to the completion of a strategic review of its rebanner programme. These charges included impairment of store locations and write-offs of rebanner-related and corporate fixed assets.
Shoe Carnival banner sales improve sequentially
Shoe Carnival banner net sales were $177.3 million, representing 65 per cent of total net sales, and declined 2.2 per cent year-on-year (YoY). Comparable store net sales under the banner declined 1.7 per cent.
The company said this marked a meaningful improvement compared with the mid-to-high single-digit quarterly declines recorded throughout fiscal 2025.
Shoe Station net sales stood at $93.4 million, accounting for 35 per cent of total net sales, and declined 3.1 per cent YoY. Comparable store net sales for the banner declined 2.9 per cent.
Shoe Carnival said improved trends in rebanner store sales were more than offset by slower growth from the Shoe Station e-commerce sales channel.
Strategic transition weighs on costs
Selling, general and administrative (SG&A) expenses on a GAAP basis increased by $12.3 million compared with Q1 2025.
“Our underlying business delivered Adjusted EPS in line with consensus expectations during a quarter of significant strategic transition. We ended the quarter with $129 million in cash and marketable securities and no debt, and we returned $7 million to shareholders through share repurchases,” added Sifford.
FY26 guidance reaffirmed
Shoe Carnival reaffirmed its previously communicated fiscal 2026 guidance. The company expects net sales of $1.125 billion to $1.147 billion, representing a range of down 1 per cent to up 1 per cent compared with fiscal 2025.
Adjusted EPS is expected to be in the range of $1.4 to $1.6. The gross profit margin is projected at around 34 per cent, representing approximately 260 basis points of compression versus fiscal 2025.
The company also expects adjusted SG&A reductions of $12 million to $14 million compared with fiscal 2025 and an adjusted tax rate of around 26 per cent.
Sifford said the back-to-school and fall selling periods represent the bulk of the company’s expected annual earnings opportunity. The company intends to manage fiscal 2026 with disciplined capital deployment, continued progress on inventory normalisation, and preparation for opening new stores in fiscal 2027.
Fibre2Fashion News Desk (SG)
