Cato Corp. (NYSE:CATO) reported a net loss of $0.55 per share for the fourth quarter ended January 31, 2026, improving from a loss of $0.74 per share recorded in the same period a year earlier. The company’s shares declined about 2.45% following the announcement.
Quarterly revenue came in at $151.66 million, representing a 3.4% decrease from $155.3 million in the fourth quarter of the prior year. Comparable store sales were unchanged from the same quarter in 2024.
The apparel retailer posted a higher gross margin of 29.2% for the quarter, up from 28.0% a year earlier. The improvement was largely driven by lower payroll and occupancy costs, though partially offset by an increase in markdown activity. Selling, general and administrative expenses fell by $1.9 million but accounted for 37.9% of sales, slightly above the 37.8% recorded last year. The company also reported a tax benefit of $1.1 million during the quarter compared with a tax expense of $0.3 million in the previous year.
“Compared to 2024, our fiscal 2025 sales trend was encouraging although 2024 was negatively impacted by supply chain interruptions which caused late merchandise to our stores, as well as more severe weather events including three hurricanes,” said John Cato, Chairman, President, and Chief Executive Officer.
For the full fiscal year 2025, Cato posted a net loss of $0.31 per share, improving from a loss of $0.97 per share in fiscal 2024. Annual revenue rose slightly by 0.7% to $646.8 million compared with $642.1 million the year before, while same-store sales increased 4% year over year.
During the year, the company closed 48 stores and ended the fiscal year with 1,069 locations across 31 states as of January 31, 2026, down from 1,117 stores a year earlier. Looking ahead to 2026, Cato plans to open up to 10 new stores while closing as many as 40 underperforming locations as leases expire.