Summary of Caleres Incorporated Q2 2026 Earnings Call

1Key Financial Results and Metrics

Sales: $695 million, up 5.6% year-over-year; organic sales increased 8.2% excluding Stuart Weitzman.

Adjusted Earnings Per Share: $0.47, compared to $0.35 in Q2 2025.

Gross Margin: Consolidated gross margin at 46.8%, up 340 basis points; Brand Portfolio gross margin at 49.1%, up 880 basis points; Famous Footwear gross margin at 42.7%, down 100 basis points.

Operating Earnings: $22.1 million, with an operating margin of 3.2%.

Inventory: $754.2 million, up $61 million year-over-year; Brand Portfolio inventory down 5.6% excluding Stuart Weitzman.

2Strategic Updates and Business Highlights

Brand Performance: Strong growth across brands, particularly in wholesale, direct-to-consumer, and international markets. Notable brands include Sam Edelman (mid-teens sales growth) and Allen Edmonds (low-teens sales growth).

Stuart Weitzman: Progressing towards breakeven with improved full-price sell-through and international sales, particularly in China.

Famous Footwear: Adjusting product assortment to focus on performance athletic and fashion categories due to a shift in consumer preferences.

International Growth: International sales increased over 50%, with significant growth potential for lead brands in underpenetrated markets.

3Forward Guidance and Outlook

Q3 Expectations: Consolidated sales expected to increase in the low single digits; Brand Portfolio sales anticipated to rise in the mid to high single digits; Famous Footwear sales projected to decline in the low single digits.

Full-Year Guidance: Consolidated sales expected to rise in the low to mid-single digits; adjusted EPS guidance raised to $2.80 to $2.95.

Gross Margin Improvement: Anticipated increase of 180 to 220 basis points for the full year.

4Bad News, Challenges, or Points of Concern

Famous Footwear Performance: Sales down 6.3% in Q2, with comparable sales down 5.9%. The back-to-school season started later than expected, impacting sales.

Inventory Management: Increased promotional activity to address excess inventory, which pressured gross margins.

Tariff Environment: Ongoing uncertainty regarding tariffs, with expectations of new tariffs that may affect costs in the upcoming quarters.

5Notable Q&A Insights

Domestic Performance: International growth is strong, but North American performance specifics were not disclosed. Order books are consistent with guidance, indicating stability.

Athletic vs. Fashion: Lifestyle athletic sales softness continues, with some stabilization noted as the back-to-school period progressed. Performance athletic remains strong.

Stuart Weitzman Integration: Integration is progressing well, with a focus on a global brand assortment and improved product flow.

Pricing Environment: Continued promotional activity expected in lifestyle athletic categories, while new product assortments may reduce markdown pressures. Overall, Caleres demonstrated strong performance in its brand portfolio, particularly internationally, while facing challenges in the Famous Footwear segment. The company remains focused on strategic growth and operational discipline amidst a dynamic retail environment.