Shoe Carnival Inc

Shoe Carnival reported sharply weaker second-quarter results and lowered its fiscal 2026 outlook, with net sales falling 7.2% to $284.3 million and comparable-store sales declining 7.1%. Diluted earnings per share dropped to $0.23 from $0.70 a year earlier, while gross margin contracted 690 basis points to 31.9% as the company discounted merchandise and cleared aged inventory, which fell 5% year over year to $426.6 million. Within the two-banner group, Shoe Carnival sales declined 6.5% to $178.5 million and Shoe Station sales declined 8.4% to $105.7 million, though comparable e-commerce sales rose 18.8%. Interim President and Chief Executive Officer Cliff Sifford said assortments at Shoe Carnival and re-bannered Shoe Station locations had not been sufficiently aligned with the customers shopping those stores, and management is relying on localized assortments, increased advertising and fall boot sales, with August comparable-store sales improving to a 2.7% decline. The company now projects fiscal 2026 net sales of $1.1 billion to $1.111 billion and adjusted earnings per share of $0.75 to $0.90, and it ended the quarter with $131.6 million in cash equivalents and marketable securities and no debt outstanding.