Carter’s, the well-known baby clothing retailer, has announced plans to shut around 150 stores across North America and cut approximately 300 jobs after tariffs imposed under former US President Donald Trump sharply reduced its profit margins. The company, based in Atlanta, reported that its net income for the three months ending in September had dropped by more than 80 per cent compared to the same period last year, falling from $58.3 million to just $11.6 million.
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In response, Carter’s will attempt to save roughly $35 million annually by expanding its number of store closures and reducing its workforce by around 15 per cent. Chief executive Doug Palladini said on Monday that although there had been “continued improvement in US retail business demand”, higher product costs driven by tariffs and ongoing investment had “weighed meaningfully” on profitability. He added that the company would “act decisively” by closing underperforming stores, restructuring operations, and refining its product range.
The decision makes Carter’s the latest major firm to suffer from the effects of US import tariffs, which range from 10 to 100 per cent on certain goods. While some of these levies are currently paused pending trade negotiations, they could be reinstated in early November. Other companies, including toy manufacturer Mattel and home improvement giant Home Depot, have also reported financial strain, with many forced to raise prices to offset increased costs.
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According to The Atlanta Business Chronicle, Mr Palladini told investors that consumer interest in Carter’s new product lines remained strong, particularly among Generation Z shoppers. However, he acknowledged that “meaningful work” remained to reduce expenses, boost efficiency, and achieve steady growth in both revenue and profitability.
