- Children's Place Inc (NASDAQ:PLCE) reported a first-quarter FY22 sales decline of 16.8% year-on-year to $362.35 million, missing the consensus of $401.59 million.
- The gross profit decreased 24.6% Y/Y to $141.9 million, with the margin contracting 400 basis points to 39.2%. Adjusted gross margin contracted 429 basis points to 39.2%.
- Operating income for the quarter declined 70.7% to $19.3 million. Adjusted operating margin contracted 1,057 basis points to 5.7%.
- Adjusted EPS of $1.05 missed the analyst consensus of $1.46.
- The company held $58.5 million in cash and equivalents as of April 30, 2022.
- "Our Q1 results were negatively impacted by several factors, the largest being lapping the unprecedented stimulus released into the economy in March of 2021," said CEO Jane Elfers.
- Due to persistently high inflation levels and the lack of visibility into its impact on the balance of the year, the company tempered its top-line expectation for 2022 and plans for a mid-single-digit decline in sales.
- Meanwhile, the company said it remains focused on delivering double-digit operating margin and double-digit EPS for 2022 and beyond.
- Starting this July, Amazon.Com, Inc (NASDAQ:AMZN) will launch the company's Gymboree brand on its website. The company expects to reach a significantly larger customer base and build upon the Gymboree momentum in 2022 and beyond.
- Price Action: PLCE shares are trading higher by 9.55% at $47.35 on the last check Thursday.
