Shoe Carnival, Inc. (NASDAQ:SCVL) traded modestly higher in premarket action Thursday after the footwear retailer delivered third-quarter results that beat revenue expectations while matching Wall Street’s earnings forecast.
The company reported Q3 revenue of $297.2 million, slightly above the consensus estimate of $295.7 million, though sales were down 3.2% from the year-ago period. Shares rose about 1.5% following the announcement.
Earnings came in at $0.53 per share, in line with analyst expectations but below the $0.70 posted in the third quarter of 2024.
Comparable store sales slipped 2.7%, though performance diverged notably across the company’s banners. Shoe Station delivered the strongest results, with sales up 5.3% and a 260-basis-point jump in product margins.
“Third quarter results exceeded expectations. Shoe Station is winning – up over 5 percent in sales with 260 basis point margin expansion,” said Mark Worden, President and Chief Executive Officer. “We’re consolidating to one brand because the performance gap is undeniable.”
Shoe Carnival reaffirmed its fiscal 2025 sales forecast and raised the lower end of its full-year earnings outlook by $0.10, expecting EPS of $1.80 to $2.10. Gross margin improved to 37.6%, up 160 basis points, supported by controlled pricing and a favorable product mix.
The retailer also said it is accelerating its shift to a single-banner model. It now plans for more than 90% of its store fleet to operate under the Shoe Station brand before fiscal 2028, a move the company anticipates will generate $20 million in annual cost savings and reduce inventory needs by $100 million once fully implemented.
Shoe Carnival closed the quarter with a solid balance sheet, reporting no debt and holding $107.7 million in cash and marketable securities, an 18.2% increase from the prior year.