By Nicholas G. Miller

Carter's posted higher fourth-quarter sales with the help of increased traffic and prices, following job cuts and store closings the company announced in October.

The baby-apparel company posted net income of $64.2 million, or $1.76 a share, up from $61.5 million, or $1.71 a share, the year prior.

Adjusted earnings were $1.90 a share, down from $2.39 a share the year before. Analysts polled by FactSet expected $1.74 a share.

Net sales increased 7.6% to $925.5 million. An extra week in the quarter contributed about $37 million. Wall Street expected net sales of $922.4 million.

Comparable net sales grew 3.4%, while comparable U.S. retail net sales increased 4.7%.

For 2026, the company guided for low-single-digit to mid-single-digit percentage net sales growth. It forecast adjusted earnings per share to decline in the low double digits to mid-teens.

"We see momentum building behind our products and demand creation initiatives, which have driven an improvement in the rate of traffic, new customer acquisition, higher realized pricing, and increased penetration of the best portions of our product assortments," said Chief Executive Douglas Palladini.

In October, Carter's said tariffs were dragging down its earnings and that it would close about 150 stores in North America and reduce its office workforce by about 15%, cutting roughly 300 positions.

Shares were down 9.7% to $38 in premarket trading.

Write to Nicholas G. Miller at nicholas.miller@wsj.com.

(END) Dow Jones Newswires

February 27, 2026 06:55 ET (11:55 GMT)

Copyright (c) 2026 Dow Jones & Company, Inc.