Childrens Place, Inc.
For the period ended Nov 1, 2025. Filed Dec 16, 2025.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Nov 1, 2025 · Filed Dec 16, 2025
PLCE$0.32-4.2%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-08-02; filed 2025-09-05.
0001041859-25-000009
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-11-01; filed 2025-12-16.
0001041859-25-000015
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 127 previous paragraphs and 137 current paragraphs.
64 unchanged; 57 reworded; 16 added; 6 removed; 0 previous and 0 current paragraphs rearranged.
Tables are not compared: 8 previous and 8 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (16)
Current report
•Year-To-Date 2025 — The thirty-nine weeks ended November 1, 2025
Current report
•Year-To-Date 2024 — The thirty-nine weeks ended November 2, 2024
Current report
During the Third Quarter 2025, we revamped our My Place Rewards loyalty program to deliver more personalized connections, rewards, and elevated experiences to our customers. Some of the key elements of the program include (i) tiered memberships, which offer members more ways to earn, unlock, and level-up benefits, (ii) earning points, bonuses, and exclusive incentives with every purchase, (iii) members-only perks, including VIP events, early collection access, and faster order processing, (iv) family-centered benefits such as birthday discounts, and (v) enhanced convenience, such as free gift-wrapping kits and the ability to redeem points at the member’s own discretion over a 12 month period. The launch of our new loyalty program is expected to drive customer acquisition and retention.
Current report
On December 16, 2025, we completed the refinancing of our asset-based revolving credit facility (the “ABL Credit Facility”) with Wells Fargo by entering into an eighth amendment (the “Eighth Amendment”) to our credit agreement. Among other things, the Eighth Amendment (i) reduced the ABL Credit Facility to $350.0 million and Wells Fargo became the sole lender party thereto, (ii) increased the sublimit for standby and documentary letters of credit to $30.0 million, (iii) lowered the interest rates, (iv) reconfigured the collateral package for the ABL Credit Facility, and (v) implemented a new minimum excess availability covenant that limits the maximum amount of borrowings that we may make under the ABL Credit Facility.
Current report
Also on December 16, 2025, we entered into a term loan agreement (the “SLR Loan Agreement”) with SLR Credit Solutions for a $100.0 million (the “SLR Term Loan”). The SLR Term Loan (i) matures on the earlier of December 16, 2030, or the maturity date under the ABL Credit Facility, (ii) bears interest, payable monthly, (a) until June 16, 2026, at the SOFR per annum plus 5.250% for any portion that is a SOFR loan, or at the base rate per annum plus 4.250% for any portion that is a base rate loan; or (b) from and after June 17, 2026, at the SOFR per annum plus 5.250% or 6.250% for any portion that is a SOFR loan, or at the base rate per annum plus 4.250% or 5.250% for any portion that is a base rate loan, based on our consolidated fixed charge coverage ratio for the trailing twelve-month period as of the most recent fiscal quarter just ended. The SLR Term Loan is, in whole or in part, pre-payable any time and from time to time, subject to certain prepayment premiums specified in the SLR Loan Agreement, plus accrued and unpaid interest. We used the net proceeds from the SLR Term Loan to partially pay down our borrowings under the ABL Credit Facility.
Current report
Pursuant to our refinancing transactions described above, both term loans issued by our majority shareholder, Mithaq Capital SPC (“Mithaq”), were amended to extend their maturity dates to April 16, 2031, and our credit facility under Mithaq was also amended to extend our deadline for requesting advances until December 16, 2030. Our second term loan with Mithaq was also amended to allow us to defer our monthly payments upon written notice to Mithaq, and as an amendment consent fee, its principal amount was increased by $2.7 million to $92.7 million.
Current report
Third Quarter 2025 Compared to Third Quarter 2024
Current report
Net sales decreased $50.7 million, or 13.0%, to $339.5 million during the Third Quarter 2025 from $390.2 million during the Third Quarter 2024, driven by a decrease in wholesale revenue due to lower order commitments as a result of higher purchases earlier in the fiscal year, and a decrease in e-commerce sales due to lower traffic and conversion compared to the Third Quarter 2024, in addition to challenges we experienced with transitioning to a new marketing agency during the Third Quarter 2025. Comparable retail sales decreased 5.4% for the Third Quarter 2025.
Current report
The Children’s Place U.S. Operating income was $9.0 million during the Third Quarter 2025, compared to $28.1 million during the Third Quarter 2024, primarily due to lower net sales, as described above.
Current report
On December 16, 2025, we completed our refinancing of the ABL Credit Facility which, among other things, reduced the ABL Credit Facility to $350.0 million. At the same time, the Company and certain subsidiaries entered into the SLR Loan Agreement with SLR for a $100.0 million SLR Term Loan, and we used the net proceeds to partially pay down our borrowings under the ABL Credit Facility.
Current report
As of November 1, 2025, we would have increased our liquidity by $35 million to $40 million, bringing our total liquidity to $128 million to $133 million on a proforma basis had the refinancing of the ABL Credit Facility and SLR Term Loan issuance been completed as of that date.
Current report
(1)Pursuant to our recent refinancing transactions, as of December 16, 2025, our credit facility availability will be subject to a new excess availability requirement.
Current report
On December 16, 2025, we completed the refinancing of the ABL Credit Facility with Wells Fargo by entering into the Eighth Amendment. Among other things, the Eighth Amendment (i) reduced the ABL Credit Facility to $350.0 million and Wells Fargo became the sole lender party thereto, (ii) increased the sublimit for standby and documentary letters of credit to $30.0 million, (iii) lowered the interest rates, (iv) reconfigured the collateral package for the ABL Credit Facility, and (v) implemented a new minimum excess availability covenant that limits the maximum amount of borrowings that we may make under the ABL Credit Facility. At the same time, the Company and certain subsidiaries entered into the SLR Loan Agreement with SLR Credit Solutions for a $100.0 million SLR Term Loan and used the net proceeds to partially pay down our borrowings under the ABL Credit Facility. Refer to “Recent Developments” above for further information.
Current report
Pursuant to our recent refinancing transactions, the Mithaq Term Loans were amended to extend both of their maturity dates to April 16, 2031. The New Mithaq Term Loan was also amended to allow us to defer our monthly payments upon written notice to Mithaq, and as an amendment consent fee, its principal amount was increased by $2.7 million to $92.7 million.
Current report
(1)Pursuant to our recent refinancing transactions, the Mithaq Term Loans were amended to extend both of their maturity dates to April 16, 2031.
Current report
Pursuant to our recent refinancing transactions, the Mithaq Credit Facility was further amended to extend the deadline for requesting advances until December 16, 2030, and the rate for any monthly payments for borrowings equivalent to interest charged was increased to the SOFR plus 9.000% per annum.
Removed paragraphs (6)
Previous report
•Year-To-Date 2025 — The twenty-six weeks ended August 2, 2025
Previous report
•Year-To-Date 2024 — The twenty-six weeks ended August 3, 2024
Previous report
•AUR — Average unit retail price
Previous report
Second Quarter 2025 Compared to Second Quarter 2024
Previous report
The Children’s Place U.S. Operating income was $6.3 million during the Second Quarter 2025, compared to a loss of $(19.7) million during the Second Quarter 2024. The Children’s Place U.S. operating margin improved during the Second Quarter 2025, primarily due to the impairment charge on the Gymboree tradename during the Second Quarter 2024.
Previous report
The Children’s Place U.S. Net sales decreased $43.6 million, or 8.1%, to $495.0 million during Year-To-Date 2025, compared to $538.6 million during Year-To-Date 2024, driven by a decrease in e-commerce sales due to lower traffic and conversion. We also experienced a decrease in brick-and-mortar revenue due to a lower store count and lower sales volume due to lower traffic. This was partially offset by an increase in wholesale revenue.
Reworded paragraphs (57)
Previous wording
•Second Quarter 2025 — The thirteen weeks ended August 2, 2025
Current wording
•Third Quarter 2025 — The thirteen weeks ended November 1, 2025
Previous wording
•Second Quarter 2024 — The thirteen weeks ended August 3, 2024
Current wording
•Third Quarter 2024 — The thirteen weeks ended November 2, 2024
Previous wording
We are the largest pure-play children’s specialty retailer in North America with an omni-channel portfolio of brands and an industry-leading digital-first model. We design, contract to manufacture, and sell fashionable, high quality apparel, accessories and footwear predominantly at value prices, primarily under our proprietary brands: “The Children’s Place”, “Gymboree”, “Sugar & Jade”, and “PJ Place”. Our global retail and wholesale network includes two digital storefronts, 494 stores in North America, wholesale marketplaces, 229 international points of distribution in 12 countries through our seven international franchise and wholesale partners, and social media channels on Instagram, Facebook, X, formerly known as Twitter, YouTube and Pinterest. Our digital storefronts are atwww.childrensplace.comand www.gymboree.com, where our customers are able to shop online for the same merchandise available in our physical stores, but also certain exclusive merchandise only available at our e-commerce sites.
Current wording
We are one of the only pure-play children’s specialty retailer in North America with an omni-channel portfolio of brands and an industry-leading digital-first model. We design, contract to manufacture, and sell fashionable, high quality apparel, accessories and footwear predominantly at value prices, primarily under our proprietary brands: “The Children’s Place”, “Gymboree”, “Sugar & Jade”, and “PJ Place”. Our global retail and wholesale network includes two digital storefronts, 499 stores in North America, wholesale marketplaces, 227 international points of distribution in 12 countries through our nine international franchise and wholesale partners, and social media channels on Instagram, Facebook, X, formerly known as Twitter, YouTube and Pinterest. Our digital storefronts are atwww.childrensplace.comand www.gymboree.com, where our customers are able to shop online for the same merchandise available in our physical stores, as well as certain exclusive merchandise offered only on our e-commerce sites.
Previous wording
In accordance with FASB ASC 280—Segment Reporting, we report segment data based on geography: The Children’s Place U.S. and The Children’s Place International. Each segment includes an e-commerce business located atwww.childrensplace.comand www.gymboree.com. Included in The Children’s Place U.S. segment are our U.S. and Puerto Rico-based stores and net sales from our U.S.-based wholesale business. Included in The Children’s Place International segment are our Canadian-based stores and net sales from international franchisees. We measure our segment profitability based on operating income (loss), defined as income (loss) before interest and taxes. Net sales and direct costs are recorded by each segment. Certain inventory procurement functions such as production and design, as well as corporate overhead, including executive management, finance, real estate, human resources, legal, and information technology services, are managed by The Children’s Place U.S. segment. Expenses related to these functions, including depreciation and amortization, are allocated to The Children’s Place International segment based primarily on net sales. The assets related to these functions are not allocated. We periodically review these allocations and adjust them based upon changes in business circumstances. Net sales to external customers are derived from merchandise sales, and we have one U.S. wholesale customer that individually accounted for more than 10% of our net sales for the Second Quarter 2025 and Year-To-Date 2025.
Current wording
In accordance with FASB ASC 280 —Segment Reporting, we report segment data based on geography: The Children’s Place U.S. and The Children’s Place International. Each segment includes an e-commerce business located atwww.childrensplace.comand www.gymboree.com. Included in The Children’s Place U.S. segment are our U.S. and Puerto Rico-based stores and net sales from our U.S.-based wholesale business. Included in The Children’s Place International segment are our Canadian-based stores and net sales from international franchisees. We measure our segment profitability based on operating income (loss), defined as income (loss) before interest and taxes. Net sales and direct costs are recorded by each segment. Certain inventory procurement functions such as production and design, as well as corporate overhead, including executive management, finance, real estate, human resources, legal, and information technology services, are managed by The Children’s Place U.S. segment. Expenses related to these functions, including depreciation and amortization, are allocated to The Children’s Place International segment based primarily on net sales. The assets related to these functions are not allocated. We periodically review these allocations and adjust them based upon changes in business circumstances. Net sales to external customers are derived from merchandise sales, and we have one U.S. wholesale customer that individually accounted for more than 10% of our net sales for Year-To-Date 2025.
Previous wording
Macroeconomic conditions, including inflationary pressures, higher interest rates, tariffs, and other domestic and geopolitical factors, continued to adversely affect our core customer. During the Second Quarter 2025, these pressures contributed to a decrease in consumer discretionary apparel purchases. We expect these macroeconomic conditions, including but not limited to increased product input costs, transportation costs, distribution costs, and geopolitical conditions like changes in foreign policies of the United States, and other inflationary pressures, to continue to have an adverse impact during the remainder of Fiscal 2025.
Current wording
Macroeconomic conditions, including inflationary pressures, higher interest rates, tariffs, and other domestic and geopolitical factors, continued to adversely affect our core customer. During the Third Quarter 2025, these pressures contributed to a decrease in consumer discretionary apparel purchases. We expect these macroeconomic conditions, including but not limited to increased product input costs, transportation costs, distribution costs, and geopolitical conditions like changes in foreign policies of the United States, and other inflationary pressures, to continue to have an adverse impact during the remainder of Fiscal 2025.
Previous wording
During Fiscal 2025, the U.S. government announced the intention to impose tariffs on certain goods imported from all countries importing goods to the United States. We have assessed the potential impact of tariffs that have become effective and are implementing plans to reduce their financial impact on us. We will continue to monitor the impact of any further tariffs that may become effective in the future, as well as potential retaliatory tariffs imposed by other countries. These tariffs could have a material adverse impact on the global retail industry, supply chains worldwide, and other political and macroeconomic conditions, which could also affect customer sentiment in deciding whether to purchase U.S. goods as opposed to other alternatives. In the meantime, we are benefiting from our diversified sourcing strategies, which includes our efforts to ensure no single country represents more than 20% of our total sourcing capacity, with limited exposure to China in the mid-single digit range.
Current wording
During Fiscal 2025, the U.S. government imposed tariffs on certain goods imported from other countries into the United States. Based on the current environment, we are projecting the impact of tariffs to result in incremental expenses of approximately $15 million to $20 million for Fiscal 2025, and an additional impact of $25 million to $30 million in the first half of fiscal year 2026. We have developed plans to mitigate a majority of the effects of these tariffs through a range of strategic initiatives, including pricing strategies, the establishment of stronger vendor partnerships, and improvements in inbound ocean rates. Additionally, our diversified sourcing strategies include efforts to ensure that no single country represents more than 20% of our total sourcing capacity, with limited exposure to China in the mid-single digit range. We will continue to monitor the impact of any further tariffs that may become effective in the future, as well as potential retaliatory tariffs imposed by other countries.
Previous wording
We will be implementing an in-depth long-range plan that will better streamline our operations to yield over $40 million of benefits over the next three years. We will be focused on reducing unnecessary corporate office costs, optimizing our distribution network, and right-sizing non-merchandise and third-party spend. These expense savings will further support our changing business model, including our strategic shift from closing stores to opening stores instead, as we revitalize the overall experience for our customers both in-store and online. Our transformation efforts also include a review of our corporate cost structure, to seek further opportunities to augment our staffing and optimize our corporate payroll. These transformation efforts are expected to incur certain one-time costs amounting to approximately $5 million to $10 million.
Current wording
We have commenced the implementation of our transformation efforts, and we are increasing the estimate of our expected gross benefits from $40 million to $50 million over the next three years. These efforts are focused on reducing unnecessary corporate office costs, optimizing our distribution network, and rightsizing non-merchandise and third-party spending. In addition, these expense savings will further support our changing business model, including our strategic shift from closing stores to opening stores instead. We have already implemented actions which are expected to realize gross benefits of over $25 million on an annualized basis. We expect to incur certain one-time costs for these transformation efforts, amounting to approximately $5 million to $10 million.
Previous wording
The Organization for Economic Cooperation and Development (“OECD”) introduced a global minimum corporate tax rate of 15% under its Pillar Two initiative (“Pillar Two”), which became effective for tax years beginning in January 2024. Although the U.S. has not yet implemented the Pillar Two rules, other regions where we conduct business, primarily Hong Kong and Canada, have enacted such legislation. The implementation of the Pillar Two rules in each jurisdiction in which it operates is not expected to have a material impact on our effective tax rate. We are closely monitoring legislative developments globally to evaluate potential impacts on our financial statements, as more regions implement Pillar Two rules.
Current wording
The Organization for Economic Cooperation and Development (“OECD”) introduced a global minimum corporate tax rate of 15% under its Pillar Two initiative (“Pillar Two”), which became effective for tax years beginning in January 2024. Although the U.S. has not implemented the Pillar Two rules, other regions where we conduct business, primarily Hong Kong and Canada, have enacted such legislation. The implementation of the Pillar Two rules in each jurisdiction in which it operates is not expected to have a material impact on our effective tax rate. We are closely monitoring legislative developments globally to evaluate potential impacts on our financial statements, as more regions implement Pillar Two rules.
Previous wording
Gross profit decreased $10.5 million to $101.3 million during the Second Quarter 2025, compared to $111.8 million during the Second Quarter 2024. Gross margin decreased 100 basis points to 34.0% of Net sales in the Second Quarter 2025, compared to 35.0% of Net sales in the Second Quarter 2024. The decrease in gross margin was caused by adjustments associated with our decrease in inventory balance compared to the Second Quarter 2024 and shifts in channel mix, partially offset by favorable product margins and improvements in product mix, pricing and promotions.
Current wording
Gross profit decreased $26.0 million to $112.3 million during the Third Quarter 2025, compared to $138.3 million during the Third Quarter 2024. Gross margin decreased 240 basis points to 33.1% of Net sales in the Third Quarter 2025, compared to 35.5% of Net sales in the Third Quarter 2024. The decrease in gross margin was caused by a higher penetration of markdown sales (200 basis points), the impact of higher tariffs on our product (55 basis points), and an increase in inventory reserves (50 basis points), partially offset by favorable channel and product mix.
Previous wording
Selling, general, and administrative expenses were $89.6 million during the Second Quarter 2025, compared to $96.1 million during the Second Quarter 2024. The decrease was primarily due to a reduction in one-time restructuring costs incurred in the Second Quarter 2024 due to the departure of certain members of the senior leadership team, partially offset by an increase in marketing expense as we continue to invest in top of funnel and brand building initiatives. The Second Quarter 2025 results included incremental operating expenses of $2.0 million, including restructuring costs of $1.2 million and an $0.8 million accrual for legal settlement. The Second Quarter 2024 results included incremental operating expenses, including restructuring costs of $6.1 million, credit agreement lender-required consulting costs of $1.1 million, professional and consulting fees of $0.4 million, and fleet optimization costs of $0.1 million. Excluding the impact of these incremental charges, Adjusted SG&A expenses were $87.6 million during the Second Quarter 2025, compared to $88.3 million during the Second Quarter 2024, and deleveraged 180 basis points to 29.4% of Net sales, due to lower sales.
Current wording
Selling, general, and administrative expenses were $101.3 million during the Third Quarter 2025, compared to $99.8 million during the Third Quarter 2024. The increase was primarily due to an increase in marketing expenses as we ramped up our spend towards the end of Third Quarter 2025 to drive incremental e-commerce demand, expenses incurred to revamp our My Place Rewards loyalty program, costs to support our new stores strategy, and an increase in donations as we further develop our inventory lifecycle process, partially offset by one-time costs incurred in the prior year. The Third Quarter 2025 results included incremental operating expenses of $0.3 million in restructuring costs. The Third Quarter 2024 results included incremental operating expenses of $6.0 million, including restructuring costs of $4.8 million, primarily due to changes in our senior leadership team, lender-required consulting fees of $0.5 million, broken financing deal fees of $0.3 million, other professional and consulting fees of $0.2 million, and fleet optimization costs of $0.1 million. Excluding the impact of these incremental charges, Adjusted SG&A expenses were $101.0 million during the Third Quarter 2025, compared to $93.8 million during the Third Quarter 2024, and deleveraged 570 basis points to 29.7% of Net sales.
Previous wording
Depreciation and amortizationwas $7.6 million during the Second Quarter 2025, compared to $9.5 million during the Second Quarter 2024. The decrease was primarily driven by reduced depreciation of capitalized software and the permanent closure of 23 stores during the past twelve months, partially offset by two store openings.
Current wording
Depreciation and amortizationwas $7.3 million during the Third Quarter 2025, compared to $9.3 million during the Third Quarter 2024. The decrease was primarily driven by reduced depreciation of capitalized software and the permanent closure of 18 stores during the past twelve months, partially offset by seven store openings.
Previous wording
There were no Asset impairment charges during the Second Quarter 2025, compared to $28.0 million during the Second Quarter 2024 due to the reduction in fair value of the Gymboree tradename.
Current wording
There were no Asset impairment charges during the Third Quarter 2025 and Third Quarter 2024.
Previous wording
Operating income (loss)was an income of $4.1 million during the Second Quarter 2025, compared to a loss of $(21.8) million during the Second Quarter 2024. The Second Quarter 2025 results were impacted by incremental operating expenses of $2.0 million, as described within SG&A expenses above. The Second Quarter 2024 results were impacted by incremental operating expenses, including SG&A expenses of $7.7 million, as described above, an impairment charge of $28.0 million on the Gymboree tradename, and accelerated depreciation of $0.3 million. Excluding the impact of these incremental charges, Adjusted operating income was $6.1 million in the Second Quarter 2025, compared to $14.2 million in the Second Quarter 2024, and deleveraged 250 basis points to 2.0% of Net sales.
Current wording
Operating incomewas $3.7 million during the Third Quarter 2025, compared to $29.3 million during the Third Quarter 2024. The Third Quarter 2025 results were impacted by incremental operating expenses of $0.3 million, as described within SG&A expenses above. The Third Quarter 2024 results were impacted by incremental operating expenses, including SG&A expenses of $6.0 million, as described above. Excluding the impact of these incremental charges, Adjusted operating income was $4.0 million in the Third Quarter 2025, compared to $35.3 million in the Third Quarter 2024, and deleveraged 780 basis points to 1.2% of Net sales.
Previous wording
Related party interest expensewas $1.9 million during the Second Quarter 2025, compared to $2.1 million during the Second Quarter 2024. The decrease was driven by a lower average interest rate on the New Mithaq Term Loan, as described below.
Current wording
Related party interest expensewas $1.9 million during the Third Quarter 2025, compared to $2.1 million during the Third Quarter 2024.
Previous wording
Other interest expense, netwas $6.2 million during the Second Quarter 2025, compared to $7.1 million during the Second Quarter 2024. The decrease in interest expense was primarily driven by lower average borrowings on our asset-based revolving credit facility (the “ABL Credit Facility”) and lower average interest rates.
Current wording
Other interest expense, netwas $6.3 million during the Third Quarter 2025, compared to $8.0 million during the Third Quarter 2024. The decrease in interest expense was primarily driven by lower average borrowings and interest rates on our ABL Credit Facility.
Previous wording
Provision for income taxeswas $1.5 million during the Second Quarter 2025, compared to $1.1 million during the Second Quarter 2024. Our effective tax rate was a provision of (37.1)% and (3.6)% in the Second Quarter 2025 and Second Quarter 2024, respectively. We continue to adjust our valuation allowance based on ongoing operating results.
Current wording
Benefit for income taxeswas $(0.1) million during the Third Quarter 2025, compared to $(0.9) million during the Third Quarter 2024. Our effective tax rate was 3.0% and (4.7)% in the Third Quarter 2025 and Third Quarter 2024, respectively. We continue to adjust our valuation allowance based on ongoing operating results.
Previous wording
Net losswas $(5.4) million, or $(0.24) per diluted share, during the Second Quarter 2025, compared to $(32.1) million, or $(2.51) per diluted share, during the Second Quarter 2024, due to the factors discussed above. Adjusted net loss was $(3.4) million, or $(0.15) per diluted share during the Second Quarter 2025, compared to adjusted net income of $3.9 million, or $0.30 per diluted share, during the Second Quarter 2024, due to the factors described above.
Current wording
Net income (loss)was a loss of $(4.3) million, or $(0.19) per diluted share, during the Third Quarter 2025, compared to income of $20.1 million, or $1.57 per diluted share, during the Third Quarter 2024, due to the factors discussed above. Adjusted net loss was $(4.0) million, or $(0.18) per diluted share during the Third Quarter 2025, compared to Adjusted net income of $26.1 million, or $2.04 per diluted share, during the Third Quarter 2024, due to the factors described above.
Previous wording
(1)The Company’s foreign subsidiaries, primarily in Canada, have operating results based in foreign currencies and are thus subject to the fluctuations of the corresponding translation rates into U.S dollars.
Current wording
(1)Our foreign subsidiaries, primarily in Canada, have operating results based in foreign currencies and are thus subject to the fluctuations of the corresponding translation rates into U.S dollars.
Previous wording
The Children’s Place U.S. Net sales decreased $19.2 million, or 6.6%, to $273.2 million during the Second Quarter 2025, compared to $292.4 million during the Second Quarter 2024, driven by a decrease in brick-and-mortar revenue due to a lower store count and lower sales volume due to lower traffic. We also experienced a decrease in e-commerce sales due to lower traffic and conversion compared to the Second Quarter 2024.
Current wording
The Children’s Place U.S. Net sales decreased $48.8 million, or 13.7%, to $307.4 million during the Third Quarter 2025, compared to $356.2 million during the Third Quarter 2024, driven by a decrease in wholesale revenue due to lower order commitments as a result of higher purchases earlier in the fiscal year, and a decrease in e-commerce sales due to lower traffic and conversion compared to the Third Quarter 2024, in addition to challenges we experienced with transitioning to a new marketing agency during the Third Quarter 2025.
Previous wording
The Children’s Place International Net sales decreased $2.5 million, or 9.0%, to $24.8 million during the Second Quarter 2025, compared to $27.3 million during the Second Quarter 2024, driven by a decrease in brick-and-mortar revenue due to a lower store count and lower sales volume due to lower traffic. We also experienced a decrease in e-commerce sales due to lower traffic and conversion compared to the Second Quarter 2024.
Current wording
The Children’s Place International Net sales decreased $1.9 million, or 5.6%, to $32.1 million during the Third Quarter 2025, compared to $34.0 million during the Third Quarter 2024, driven by a decrease in e-commerce sales due to lower traffic.
Previous wording
The Children’s Place International Operating loss was $(2.2) million during the Second Quarter 2025, compared to $(2.1) million during the Second Quarter 2024.
Current wording
The Children’s Place International Operating loss was $(5.3) million during the Third Quarter 2025, compared to operating income of $1.1 million during the Third Quarter 2024, primarily due to liquidation sales on certain inventory which negatively impacted our margins.
Previous wording
Net sales decreased $47.4 million, or 8.1%, to $540.1 million during Year-To-Date 2025 from $587.5 million during Year-To-Date 2024, driven by a decrease in e-commerce sales due to lower traffic and conversion. We also experienced a decrease in brick-and-mortar revenue due to a lower store count and lower sales volume due to lower traffic. Our stores and e-commerce sales were both negatively impacted by the current macroeconomic environment, including uncertainty around potential tariffs, which has negatively affected consumer sentiment. This was partially offset by an increase in wholesale revenue. Comparable retail sales decreased 8.9% during Year-To-Date 2025.
Current wording
Net sales decreased $98.1 million, or 10.0%, to $879.6 million during Year-To-Date 2025 from $977.7 million during Year-To-Date 2024, driven by a decrease in e-commerce sales due to lower traffic and conversion. We also experienced a decrease in brick-and-mortar revenue due to a lower store count and lower sales volume, particularly in the first half of the fiscal year. Our stores and e-commerce sales were both negatively impacted by the current macroeconomic environment, including uncertainty around tariffs, which has negatively affected consumer sentiment. We also experienced a decrease in wholesale revenue as we shifted our strategy towards selling higher margin product to improve profitability. Comparable retail sales decreased 7.5% during Year-To-Date 2025.
Previous wording
Gross profit decreased $32.5 million to $172.1 million during Year-To-Date 2025, compared to $204.5 million during Year-To-Date 2024. Gross margin decreased 290 basis points to 31.9% of Net sales during Year-To-Date 2025, compared to 34.8% of Net sales in Year-To-Date 2024. The decrease in gross margin was caused by adjustments associated with our decrease in inventory balance compared to the prior year and shifts in channel mix from the higher penetration of wholesale sales, partially offset by favorable product margins and improvements in pricing and promotions.
Current wording
Gross profit decreased $58.5 million to $284.4 million during Year-To-Date 2025, compared to $342.9 million during Year-To-Date 2024. Gross margin decreased 280 basis points to 32.3% of Net sales during Year-To-Date 2025, compared to 35.1% of Net sales in Year-To-Date 2024. The decrease in gross margin was caused primarily by a higher penetration of markdown sales (140 basis points), an increase in inventory reserves (110 basis points), and the impact of higher tariffs on our product (50 basis points).
Previous wording
Selling, general, and administrative expenses were$176.3 million during Year-To-Date 2025, compared to$205.2 million during Year-To-Date 2024. The decrease was due to a reduction in one-time costs incurred during Year-To-Date 2025, as described below. The Year-To-Date 2025 results included incremental operating expenses of $2.1 million for restructuring costs. The Year-To-Date 2024 results included incremental operating expenses, including costs associated with our change of control of $13.7 million, financing related charges of $6.7 million, restructuring costs of $6.4 million, credit agreement lender-required consulting costs of $1.9 million, costs associated with the closure of our Canada distribution center of $0.8 million, fleet optimization costs of $0.7 million, and professional and consulting fees of $0.4 million, partially offset by the reversal of a legal settlement accrual of $2.3 million. Excluding the impact of these incremental charges, Adjusted SG&A expenses were $174.2 million during Year-To-Date 2025, compared to $177.0 million during Year-To-Date 2024, and deleveraged 210 basis points to 32.2% of Net sales.
Current wording
Selling, general, and administrative expenses were$277.6 million during Year-To-Date 2025, compared to$305.0 million during Year-To-Date 2024. The decrease was due to a reduction in one-time costs incurred during Year-To-Date 2024, as described below. The Year-To-Date 2025 results included incremental operating expenses of $2.4 million for restructuring costs. The Year-To-Date 2024 results included incremental operating expenses, including restructuring costs of $11.2 million, primarily due to changes in our senior leadership team, non-cash equity compensation charges of $9.9 million and other fees of $3.8 million associated with the change of control, financing-related charges of $7.0 million, lender-required consulting fees of $2.4 million, fleet optimization costs of $0.9 million, costs associated with the closure of our Canada distribution center of $0.8 million, and other professional and consulting fees of $0.6 million, partially offset by the reversal of a legal settlement accrual of $2.3 million. Excluding the impact of these incremental charges, Adjusted SG&A expenses were $275.1 million during Year-To-Date 2025, compared to $270.8 million during Year-To-Date 2024, and deleveraged 360 basis points to 31.3% of Net sales.
Previous wording
Depreciation and amortizationwas $15.8 million during Year-To-Date 2025, compared to $21.1 million during Year-To-Date 2024. The decrease was primarily driven by reduced depreciation of capitalized software and the permanent closure of 23 stores during the past twelve months, partially offset by two store openings.
Current wording
Depreciation and amortizationwas $23.1 million during Year-To-Date 2025, compared to $30.4 million during Year-To-Date 2024. The decrease was primarily driven by reduced depreciation of capitalized software and the permanent closure of 18 stores during the past twelve months, partially offset by seven store openings.
Previous wording
Operating losswas $(20.0) million during Year-To-Date 2025, compared to $(49.8) million during Year-To-Date 2024. The Year-To-Date 2025 results were impacted by incremental operating expenses of $2.1 million, as described within SG&A expenses above. The Year-To-Date 2024 results were impacted by incremental operating expenses, including SG&A expenses of $28.2 million, as described above, an impairment charge of $28.0 million on the Gymboree tradename, accelerated depreciation of $1.8 million, and additional change in control charges impacting gross margin of $0.9 million. Excluding the impact of these incremental charges, Adjusted operating loss was $(17.9) million during Year-To-Date 2025, compared to Adjusted operating income of $9.2 million during Year-To-Date 2024, and deleveraged 490 basis points to (3.3)% of Net sales.
Current wording
Operating losswas $(16.3) million during Year-To-Date 2025, compared to $(20.5) million during Year-To-Date 2024. The Year-To-Date 2025 results were impacted by incremental operating expenses of $2.4 million, as described within SG&A expenses above. The Year-To-Date 2024 results were impacted by incremental operating expenses, including SG&A expenses of $34.2 million, as described above, an impairment charge of $28.0 million on the Gymboree tradename, accelerated depreciation of $1.8 million, and additional change in control charges impacting gross margin of $0.9 million. Excluding the impact of these incremental charges, Adjusted operating loss was $(13.9) million during Year-To-Date 2025, compared to Adjusted operating income of $44.4 million during Year-To-Date 2024, and deleveraged 610 basis points to (1.6)% of Net sales.
Previous wording
Related party interest expensewas $3.7 million during Year-To-Date 2025, compared to $2.5 million during Year-To-Date 2024. The increase was due to interest-equivalent charges for the full period compared to a partial period in the prior year.
Current wording
Related party interest expensewas $5.6 million during Year-To-Date 2025, compared to $4.6 million during Year-To-Date 2024. The increase was due to interest-equivalent charges for the full period compared to a partial period in the prior year.
Previous wording
Other interest expense, netwas $12.8 million during Year-To-Date 2025, compared to $14.5 million during Year-To-Date 2024. The decrease in interest expense was primarily driven by lower average interest rates on our ABL Credit Facility, partially offset by the write-off of deferred financing costs associated with the partial paydown of our first term loan entered into with our majority shareholder, Mithaq Capital SPC (“Mithaq”).
Current wording
Other interest expense, netwas $19.1 million during Year-To-Date 2025, compared to $22.5 million during Year-To-Date 2024. The decrease in interest expense was primarily driven by lower average borrowings and interest rates on our ABL Credit Facility, partially offset by the write-off of deferred financing costs associated with the partial paydown of our first term loan entered into with our majority shareholder, Mithaq Capital SPC (“Mithaq”).
Previous wording
Provision for income taxeswas $2.8 million during Year-To-Date 2025, compared to $3.2 million during Year-To-Date 2024. Our effective tax rate was a provision of (7.6)% and (4.8)% during Year-To-Date 2025 and Year-To-Date 2024, respectively. We continue to adjust our valuation allowance based on ongoing operating results.
Current wording
Provision for income taxeswas $2.7 million during Year-To-Date 2025, compared to $2.3 million during Year-To-Date 2024. Our effective tax rate was (6.5)% and (4.8)% during Year-To-Date 2025 and Year-To-Date 2024, respectively. We continue to adjust our valuation allowance based on ongoing operating results.
Previous wording
Net losswas $(39.4) million, or $(1.80) per diluted share, during Year-To-Date 2025, compared to $(69.9) million, or $(5.49) per diluted share, during Year-To-Date 2024, due to the factors discussed above. Adjusted net loss was $(36.3) million, or $(1.66) per diluted share during Year-To-Date 2025, compared to $(11.0) million, or $(0.86) per diluted share, during Year-To-Date 2024, due to the factors described above.
Current wording
Net losswas $(43.7) million, or $(1.99) per diluted share, during Year-To-Date 2025, compared to $(49.8) million, or $(3.91) per diluted share, during Year-To-Date 2024, due to the factors discussed above. Adjusted net loss was $(40.2) million, or $(1.83) per diluted share during Year-To-Date 2025, compared to Adjusted net income of $15.1 million, or $1.18 per diluted share, during Year-To-Date 2024, due to the factors described above.
Previous wording
(1)The Company’s foreign subsidiaries, primarily in Canada, have operating results based in foreign currencies and are thus subject to the fluctuations of the corresponding translation rates into U.S dollars.
Current wording
(1)Our foreign subsidiaries, primarily in Canada, have operating results based in foreign currencies and are thus subject to the fluctuations of the corresponding translation rates into U.S dollars.
Previous wording
Net sales decreased $21.7 million, or 6.8%, to $298.0 million during the Second Quarter 2025 from $319.7 million during the Second Quarter 2024, driven by a decrease in brick-and-mortar revenue due to a lower store count and lower sales volume due to lower traffic. We also experienced a decrease in e-commerce sales due to lower traffic and conversion compared to the Second Quarter 2024, however, these trends have improved since the first quarter of Fiscal 2025, due to shifts in our marketing strategies combined with the impact of our new product strategies. Our stores and e-commerce sales were both negatively impacted by the current macroeconomic environment, including uncertainty around potential tariffs, which has negatively affected consumer sentiment. Comparable retail sales decreased 4.7% for the Second Quarter 2025.
Current wording
The Children’s Place U.S. Net sales decreased $92.3 million, or 10.3%, to $802.4 million during Year-To-Date 2025, compared to $894.7 million during Year-To-Date 2024, driven by a decrease in e-commerce sales due to lower traffic and conversion. We also experienced a decrease in brick-and-mortar revenue due to a lower store count and lower sales volume, particularly in the first half of the fiscal year. Our stores and e-commerce sales were both negatively impacted by the current macroeconomic environment, including uncertainty around tariffs, which has negatively affected consumer sentiment. We also experienced a decrease in wholesale revenue as we shifted our strategy towards selling higher margin product to improve profitability.
Previous wording
The Children’s Place International Net sales decreased $3.8 million, or 7.8%, to $45.2 million during Year-To-Date 2025, compared to $49.0 million during Year-To-Date 2024, driven by a decrease in e-commerce sales due to lower traffic and conversion. We also experienced a decrease in brick-and-mortar revenue due to a lower store count and lower sales volume due to lower traffic.
Current wording
The Children’s Place International Net sales decreased $5.8 million, or 7.0%, to $77.2 million during Year-To-Date 2025, compared to $83.0 million during Year-To-Date 2024, driven by a decrease in e-commerce sales due to lower traffic and conversion. We also experienced a decrease in brick-and-mortar revenue due to a lower store count and lower sales volume, particularly in the first half of the fiscal year.
Previous wording
The Children’s Place U.S. Operating loss was $(13.4) million during Year-To-Date 2025, compared to $(43.7) million during Year-To-Date 2024. The Children’s Place U.S. operating margin improved during Year-To-Date 2025, primarily due to the impairment charge on the Gymboree tradename during Year-To-Date 2024.
Current wording
The Children’s Place U.S. Operating loss was $(4.4) million during Year-To-Date 2025, compared to $(15.5) million during Year-To-Date 2024. The Children’s Place U.S. operating margin improved during Year-To-Date 2025, primarily due to the impairment charge on the Gymboree tradename during Year-To-Date 2024, partially offset by lower net sales, as described above.
Previous wording
The Children’s Place International Operating loss was $(6.6) million during Year-To-Date 2025, compared to $(6.1) million during Year-To-Date 2024.
Current wording
The Children’s Place International Operating loss was $(11.9) million during Year-To-Date 2025, compared to $(5.0) million during Year-To-Date 2024, primarily due to liquidation sales on certain inventory which negatively impacted our margins.
Previous wording
As of August 2, 2025, we had $294.4 million of outstanding borrowings under our $433.0 million ABL Credit Facility and no borrowings under our $40.0 million senior unsecured credit facility with Mithaq (the “Mithaq Credit Facility”).
Current wording
As of November 1, 2025, we had $297.2 million of outstanding borrowings under our $433.0 million ABL Credit Facility and no borrowings under our $40.0 million senior unsecured credit facility with Mithaq (the “Mithaq Credit Facility”).
Previous wording
Our working capital deficit decreased $31.1 million to $40.0 million as of August 2, 2025, compared to $71.2 million as of August 3, 2024, primarily reflecting a decrease in our accounts payable balances as we paid down past due vendors and reduced inventory purchases, and a decrease in outstanding borrowings under our ABL Credit Facility, partially offset by a decrease in inventory due to improved inventory management as we continue to align our inventory levels with our growth and product strategy, and better balance the mix of fashion and basic product.
Current wording
Our working capital deficit decreased $3.8 million to $42.5 million as of November 1, 2025, compared to $46.3 million as of November 2, 2024, primarily reflecting a decrease in our accounts payable balances as we paid down past due vendors and reduced inventory purchases, and a decrease in outstanding borrowings under our ABL Credit Facility, partially offset by a decrease in inventory due to improved inventory management as we continue to align our inventory levels with our growth and product strategy, and better balance the mix of fashion and basic product.
Previous wording
As of August 2, 2025, we had total liquidity of $91.6 million, including $43.8 million of availability under our ABL Credit Facility, $40.0 million of availability under our Mithaq Credit Facility, and $7.8 million of cash on hand. As of August 2, 2025, we had $18.2 million of outstanding letters of credit, with an additional $6.8 million available for issuing letters of credit under our ABL Credit Facility.
Current wording
As of November 1, 2025, we had total liquidity of $93.4 million, including $46.1 million of availability under our ABL Credit Facility, $40.0 million of availability under our Mithaq Credit Facility, and $7.3 million of cash on hand. As of November 1, 2025, we had $18.2 million of outstanding letters of credit, with an additional $6.8 million available for issuing letters of credit under our ABL Credit Facility.
Previous wording
We expect to be able to meet our working capital and capital expenditure requirements for at least the next twelve months from the date that our consolidated financial statements for the Second Quarter 2025 were issued, by using our cash on hand, cash flows from operations, and availability under our ABL Credit Facility and Mithaq Credit Facility.
Current wording
We expect to be able to meet our working capital and capital expenditure requirements for at least the next twelve months from the date that our consolidated financial statements for the Third Quarter 2025 were issued, by using our cash on hand, cash flows from operations, and availability under our ABL Credit Facility and Mithaq Credit Facility.
Previous wording
In November 2021, our Board of Directors (the “Board”) authorized a $250.0 million share repurchase program (the “Share Repurchase Program”). Currently, given the terms of our credit agreement with Wells Fargo and other lenders, as amended by its seventh amendment, the repurchase of any shares would require fulfilling the heightened payment conditions under that credit agreement, except that repurchases of shares as described in “Note 8. Stockholders’ Deficit” of the consolidated financial statements, pursuant to our practice as a result of our insider trading policy, are expressly permitted. As of August 2, 2025, there was $156.1 million remaining availability under the Share Repurchase Program.
Current wording
In November 2021, our Board of Directors (the “Board”) authorized a $250.0 million share repurchase program (the “Share Repurchase Program”). Currently, given the terms of our credit agreement with Wells Fargo as its administrative agent, the repurchase of any shares would require fulfilling the heightened payment conditions under that credit agreement, except that repurchases of shares as described in “Note 8. Stockholders’ Deficit” of the consolidated financial statements, pursuant to our practice as a result of our insider trading policy, are expressly permitted. As of November 1, 2025, there was $156.1 million remaining availability under the Share Repurchase Program.
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