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Benjamin Fitzgerald Published
December 4, 2025
The Children's Place said on Tuesday that sales fell 18.8% to $390.2 million for the third quarter, driven by a decrease in e-commerce revenue and in-store sales with less locations and sluggish consumer traffic.
The Secaucus, New Jersey-based kids retailer said comparable retail sales for the quarter ending November 2 fell 17.1% on a decrease in e-commerce revenue, as the company sacrificed unprofitable sales to improve profitability, according to a press release.
As a result of the plunging revenues, net income fell to $20.8 million, compared to $38.5 million in prior-year period.
Moreover, fiscal year-to-date sales declined 14.8% to $977.7 million in the nine months ended November 2, due to a lower store count, and anticipated declines in e-commerce demand due to the rationalization of promotions, reductions in inflated and unprofitable marketing spend and the strategic decision to change “free shipping” offers, the company added.
“During the third quarter, we continued our efforts to improve the profitability of the business and provide a foundation for future growth and we were able to achieve a second consecutive quarter of adjusted profits," said Muhammad Umair, president and interim chief executive officer.
"As we previously discussed, we anticipated our strategic changes would provide pressure to topline sales, however we are laser focused on profitability and willing to proactively sacrifice unprofitable sales to improve operating results for our shareholders. We were also extremely pleased to drive further improvements in gross profit margin versus the prior year’s third quarter and sequential improvement in margin for all three quarters this year. In addition, we also continued our efforts to decrease Adjusted SG&A expenses, as we significantly reduced marketing spend and further reduced payroll costs, resulting in a $9 million reduction in expenses. These efforts resulted in our second consecutive profitable quarter with more than $35 million of Adjusted operating income and $44.5 million of Adjusted EBITDA.”
In October, The Children's Place announced it had teamed up with Shein to launch on the global online platform. As part of the partnership, the retailer's collection is available on Shein in the US. Looking ahead, the brand will be available globally in a phased roll-out.