Slide 1: Second Quarter 2025 Business Update
SECOND QUARTER 2025 BUSINESS UPDATE JULY 25, 2025
Slide 2: Second Quarter 2025 Results
SECOND QUARTER 2025 RESULTS GAAP BASIS $ in millions, except EPS Second Second Quarter % of Quarter % of 2025 Net Sales 2024 Net Sales Change Net sales $585 $564 4% Gross profit 282 48.1% 283 50.1% -% Royalty income, net 3 0.6% 4 0.7% (19%) SG&A 281 48.0% 247 43.8% 13% Operating income 4 0.7% 39 7.0
Slide 3: First Half 2025 Results
FIRST HALF 2025 RESULTS GAAP BASIS $ in millions, except EPS First Half % of First Half % of 2025 Net Sales 2024 Net Sales Change Net sales $1,215 $1,226 (1%) Gross profit 573 47.1% 598 48.8% (4%) Royalty income 9 0.7% 9 0.8% (7%) SG&A 551 45.4% 513 41.8% 7% Operating income 30 2.5% 94 7.7% (68%) In
Slide 4: Non-GAAP Adjustments
NON-GAAP ADJUSTMENTS • Adjustments to second quarter and first half 2025 results are shown below • No adjustments to second quarter and first half 2024 results $ in millions, except EPS Second Quarter 2025 Operating % Net Pre-Tax Net Diluted Income Sales Income Income EPS As reported (GAAP) $4 0.7%
Slide 5: Second Quarter 2025 Performance
SECOND QUARTER 2025 PERFORMANCE $ in millions, except EPS Adjusted Operating Income1 Net Sales (Adjusted Operating Margin) Adjusted Diluted EPS1 +4% (70%) (78%) vs. vs. vs. 2024 2024 2024 $39 $0.76 $585 $564 $12 $0.17 7.0% 2.0% of Net of Net Sales Sales 2024 2025 2024 2025 2024 2025 1 Non-GAAP measu
Slide 6: Adjusted Second Quarter 2025 Results
ADJUSTED SECOND QUARTER 2025 RESULT S1 $ in millions, except EPS Second Second Quarter % of Quarter % of 2025 Net Sales 2024 Net Sales Change Net sales $585 $564 4% Gross profit 282 48.1% 283 50.1% -% Royalty income 3 0.6% 4 0.7% (19%) Adjusted SG&A 273 46.7% 247 43.8% 10% Adjusted operating income
Slide 7: Second Quarter 2025 Segment Results
SECOND QUARTER 2025 SEGMENT RESULTS $ in millions Net Sales Operating Income Operating Margin 2025 2024 $ Change 2025 2024 $ Change 2025 2024 U.S. Retail $300 $290 $9 $4 $18 ($14) 1.3% 6.2% U.S. Wholesale 193 193 - 27 36 (9) 14.0% 18.8% International 93 81 11 4 6 (2) 3.9% 6.8% Total before Corporate
Slide 8: Second Quarter 2025 Performance – U.S. Retail
SECOND QUARTER 2025 PERFORMANCE – U.S. RETAIL 2025 vs. 2024 • Net sales +3% vs. LY; units +6% • Comparable sales +2% − Performance led by Stores Sales − Growth driven by strong April and product & promotional strategies − Strong conversion trends in both channels − Third consecutive quarter of comp
Slide 9: Second Quarter Segment Performance
SECOND QUARTER SEGMENT PERFORMANCE 2025 vs. 2024 U.S. WHOLESALE INTERNATIONAL • Net sales: comparable (units +6%) • Net sales: +14% (units +15%) ― Growth with 2 of 3 Exclusive Brands, ― Strong growth in all International off-price channel (excess), and Skip Hop components ― Lower department store de
Slide 10: First Half 2025 Performance
FIRST HALF 2025 PERFORMANCE $ in millions, except EPS Adjusted Operating Income1 Net Sales (Adjusted Operating Margin) Adjusted Diluted EPS1 (1%) (50%) (54%) vs. vs. vs. 2024 2024 2024 $94 $1.80 $1,226 $1,215 $47 $0.83 7.7% 3.9% of Net of Net Sales Sales 2024 2025 2024 2025 2024 2025 1 Non-GAAP meas
Slide 11: Adjusted First Half 2025 Results
ADJUSTED FIRST HALF 2025 RESULTS 1 $ in millions, except EPS First Half % of First Half % of 2025 Net Sales 2024 Net Sales Change Net sales $1,215 $1,226 (1%) Gross profit 573 47.1% 598 48.8% (4%) Royalty income 9 0.7% 9 0.8% (7%) Adjusted SG&A 534 44.0% 513 41.8% 4% Adjusted operating income 47 3.9
Slide 12: First Half 2025 Segment Performance
FIRST HALF 2025 SEGMENT PERFORMANCE $ in millions Net Sales Operating Income Operating Margin 2025 2024 $ Change 2025 2024 $ Change 2025 2024 U.S. Retail $594 $598 ($4) $6 $32 ($26) 1.0% 5.4% U.S. Wholesale 443 457 (14) 82 100 (17) 18.6% 21.8% International 178 171 7 3 8 (4) 1.9% 4.5% Total before 1
Slide 13: Balance Sheet & Cash Flow
BALANCE SHEET & CASH FLOW $ in millions Balance Sheet (Q2 End) Cash Flow (First Half) 2025 2024 2025 2024 Cash $338 $317 Operating cash flow $(8) $92 Accounts receivable, net 140 132 Capital expenditures (27) (24) Inventory, net 619 599 Free cash flow2 $(35) $67 Accounts payable 306 314 Dividends $3
Slide 14: Initiative Updates
INITIATIVE UPDATES 14
Slide 15: Progress Improving Our Operating Model
PROGRESS IMPROVING OUR OPERATING MODEL • Shortening product development process by ~3 months with improving disciplines Concept to • Enhancing chase capabilities Consumer Initiative • Better leveraging technology including AI • Consumer insights strengthening assortment performance • Comprehensive a
Slide 16: Impact of New Tariffs & Actions to Mitigate
IMPACT OF NEW TARIFFS & ACTIONS TO MITIGATE Top 4 Rest of Countries of Origin 2024 China <4% World • Vietnam Finished 25% Goods Top 4 • Cambodia 75% Sourcing Mix • Bangladesh • India • U.S. import duties paid in 2024: ~$110 million Estimated Impact of • Pre-tax earnings impact of additional proposed
Slide 17: Chief Executive Officer Insights & Key Learnings
CHIEF EXECUTIVE OFFICER INSIGHTS & KEY LEARNINGS 17
Slide 18: Carter's Leadership Team
CARTER’S LEADERSHIP TEAM Sarah Crockett Julie D'Emilio Emily Evert Chief Marketing Officer Chief Sales Officer Chief Strategy Officer1 Douglas C. Palladini Chief Executive Officer & President Kendra Krugman Allison Peterson Antonio Robinson Chief Product Officer Chief Retail & Digital Officer Chief
Slide 19: Our Core Brands
OUR CORE BRANDS 19
Slide 20: Our Emerging Brands
OUR EMERGING BRANDS 20
Slide 21: Our Exclusive Brands
OUR EXCLUSIVE BR aN | Walmart as Ds Ais
Slide 22: Carter's Purpose Is To
CARTER’S PURPOSE IS TO embrace the wonder of childhood and uplift those shaping the future 22
Slide 23: Carter's: 160 Years of Family Trust
CARTER’S: 160 YEARS OF FAMILY TRUST CLICK HERE TO VIEW VIDEO
Slide 24: Carter's: 160 Years of Family Trust
CARTER’S: 160 YEARS OF FAMILY TRUST 24
Slide 25: OshKosh B'gosh: 130 Years of Denim Heritage
OSHKOSH B’GOSH: 130 YEARS OF DENIM HERITAGE
Slide 26: Little Planet: Elevated-Style, Eco-Friendly Design
BRANDING ON PRODUCTS LITTLE PLANET: ELEVATED-STYLE, ECO-FRIENDLY DESIGN 26
Slide 27: Otter Avenue: Created Just for Toddlers
OTTER AVENUE: CREATED JUST FOR TODDLERS 27
Slide 28: Skip Hop: Must-Haves, Made Better
SKIP HOP: MUST-HAVES, MADE BETTER
Slide 29: Carter's Stores: Evolving the Best Expression of Our Brands
CARTER’S STORES: EVOLVING THE BEST EXPRESSION OF OUR BRANDS
Slide 30: Our Ecommerce: Seamless Digital Integration
OUR ECOMMERCE: SEAMLESS DIGITAL INTEGRATION 30
Slide 31: Thank You
THANK YOU 31
Slide 32: Supplemental Information
SUPPLEMENTAL INFORMATION 32
Slide 33: Reconciliation of Reported to Adjusted Earnings
RECONCILIATION OF REPORTED TO ADJUSTED EARNINGS $ in millions, except EPS Income % of Operating % of Pre-Tax Tax Net Diluted Second Quarter of Fiscal 2025 SG&A net sales Income net sales Income Provision Income EPS As reported (GAAP) $281.0 48.0% $4.0 0.7% $1.7 $1.3 $0.4 $0.01 Operating model improv
Slide 34: Reconciliation of Total Segment Operating Income to Consolidated Operating Income
RECONCILIATION OF TOTAL SEGMENT OPERATING INCOME TO CONSOLIDATED OPERATING INCOME $ in millions Fiscal Quarter Ended Two Fiscal Quarters Ended June 28, 2025 June 29, 2024 June 28, 2025 June 29, 2024 % of % of % of % of net sales net sales net sales net sales Total segment operating income (a) $34.4
Slide 35: Reconciliation of Net Income to Adjusted EBITDA
RECONCILIATION OF NET INCOME TO ADJUSTED EBITDA $ in millions Four Fiscal Fiscal Quarter Ended Two Fiscal Quarters Ended Quarters Ended June 28, 2025 June 29, 2024 June 28, 2025 June 29, 2024 June 28, 2025 Net income $0.4 $27.6 $16.0 $65.7 $135.8 Interest expense 7.9 7.9 15.7 15.8 31.2 Interest inco
Slide 36: Second Quarter Reconciliation of Adjusted Net Income Allocable to Common Shareholders
SECOND QUARTER RECONCILIATION OF ADJUSTED NET INCOME ALLOCABLE TO COMMON SHAREHOLDERS Fiscal Quarter Ended Weighted-average number of common and common equivalent shares outstanding: June 28, 2025 June 29, 2024 Basic number of common shares outstanding 35,409,988 35,688,755 Dilutive effect of equity
Slide 37: First Half Reconciliation of Adjusted Net Income Allocable to Common Shareholders
FIRST HALF RECONCILIATION OF ADJUSTED NET INCOME ALLOCABLE TO COMMON SHAREHOLDERS Fiscal Quarter Ended Weighted-average number of common and common equivalent shares outstanding: June 28, 2025 June 29, 2024 Basic number of common shares outstanding 35,361,039 35,774,748 Dilutive effect of equity awa
Slide 38: Net Sales Constant Currency Reconciliation
NET SALES CONSTANT CURRENCY RECONCILIATION $ in millions Fiscal Quarter Ended Impact of Constant- Constant- Reported Net Foreign Currency Net Reported Net Reported Currency Sales Currency Sales Sales Net Sales Net Sales % June 28, 2025 Translation June 28, 2025 June 29, 2024 % Change Change Consolid
Slide 39: Forward Looking Statements
FORWARD LOOKING STATEMENTS Statements in this presentation that are not historical fact and use predictive words such as “estimates”, “outlook”, “guidance”, “expect”, “believe”, “intend”, “designed”, “target”, “plans”, “may”, “will”, “are confident” and similar words are forward-looking statements (
Slide 40: Store Count Reconciliation
STORE COUNT RECONCILIATION U.S Canada Mexico Total Store count at June 29, 2024 789 186 52 1,027 Openings 26 6 11 43 Closings (11) (1) (1) (13) Store count at December 28, 2024 804 191 62 1,057 Openings 14 2 4 20 Closings (9) (1) (2) (12) Store count at June 28, 2025 809 192 64 1,065 40