For FY25 ended January 31, 2026, net sales declined by $177.4 million, or 12.8 per cent year-over-year (YoY), to $1.209 billion, compared to $1.386 billion in the previous year. The decline reflected weaker e-commerce performance, lower store traffic and reduced wholesale activity. Comparable retail sales fell by 8.4 per cent over the year.
The Children’s Place has reported a sharp FY25 decline, with net sales down 12.8 per cent to $1.209 billion amid weak e-commerce, lower store traffic and tariff pressures.
Losses widened significantly as margins contracted.
Q4 performance also weakened.
CEO Umair emphasised cost control, digital improvements and liquidity strengthening as part of a turnaround strategy to restore growth.
Muhammad Umair, president and CEO of the company said, “Our transformation is creating real operating leverage. We are focused on reducing costs, margin expansion opportunities, and prioritising free cash flow generation.”
He further said the company has strengthened its liquidity position and now have the financial flexibility to make the strategic investments needed to succeed during its critical back-to-school season. “We know what needs to be done, we have a clear plan, and we are executing with urgency,” added Umair.
The gross profit for the year decreased to $361.6 million from $459.5 million, while gross margin narrowed by 320 basis points to 29.9 per cent. The contraction was driven by higher inventory reserves, tariff impacts and increased promotional activity. Selling, general and administrative (SG&A) expenses declined to $383.7 million, though they deleveraged to 31.7 per cent of net sales, Children’s Place said in a press release.
The company posted a full-year operating loss of $(57.2) million, compared to a loss of $(13.7) million in the previous year. Net loss widened to $(88.3) million, or $(4.01) per diluted share, compared to $(57.8) million, or $(4.53) per diluted share a year earlier.
Meanwhile, in the fourth quarter (Q4), net sales declined by $79.3 million, or 19.4 per cent, to $329.2 million, compared to $408.6 million in the same period last year. The decline was largely driven by reduced e-commerce sales due to lower traffic and conversion, alongside a planned reduction in wholesale shipments to Amazon. Comparable retail sales fell by 10.7 per cent.
Gross profit dropped to $77.4 million from $116.6 million, while gross margin contracted by 500 basis points to 23.5 per cent. The margin decline was attributed to higher tariffs, increased markdown activity and elevated inventory reserves, partially offset by improved product costs. Selling, general and administrative expenses rose to $106.3 million, deleveraging to 32.3 per cent of net sales, primarily due to higher marketing spend.
“While our fourth quarter results were disappointing, we are taking decisive action to turn this business around. The Children’s Place brand remains strong, recently ranked 21st in TIME’s survey of ‘America’s most iconic companies’, and we are leveraging that foundation to drive our transformation,” said Umair. “We are reigniting what makes our brand unique by delivering compelling product, design, and branding, with the consumer at the centre of every decision we make.”
Despite the financial pressures, The Children’s Place maintained a relatively stable store footprint, ending the year with 498 stores after opening 10 and closing 11 locations during the fourth quarter.
The company remains focused on its turnaround strategy, including strengthening its digital capabilities, optimising costs, enhancing product offerings and improving customer engagement, as it prepares for key retail periods and aims to stabilise performance in a challenging retail environment.
Fibre2Fashion News Desk (SG)
