Shoe Station Group, Inc. reported financial results for the second quarter ended August 1, 2026, revealing a decline in net sales and a reduction in full-year guidance. The company, which changed its name from Shoe Carnival, Inc. on June 12, 2026, and began trading on Nasdaq under the symbol SHOE, reported net sales of $284.3 million for the quarter. This figure represents a decrease of $22.1 million, or 7.2 percent, compared to the $306.4 million recorded in the second quarter of 2025.
Comparable store sales for the quarter declined 7.1 percent. This decline was driven by an increasingly promotional footwear marketplace and merchandise assortments that were not fully aligned with customer shopping patterns. The company operates two banners: Shoe Carnival, which accounted for 63 percent of total net sales ($178.5 million), and Shoe Station, which accounted for 37 percent of total net sales ($105.7 million). During the quarter, the company rebannered 20 Shoe Carnival stores into Shoe Station stores, bringing the total number of rebanners for Fiscal 2026 to 21.
Gross profit margin for the second quarter of 2026 was 31.9 percent, a decrease of 690 basis points compared to the prior year. This compression was attributed to increased promotional activity, the liquidation of aged and excess inventory, and the prior-year benefit from raising prices in advance of tariff-related cost increases. The company reported net income of $6.3 million, or $0.23 per diluted share, compared to $19.2 million, or $0.70 per diluted share, in the prior year.
Despite the quarterly challenges, the company noted an improvement in back-to-school trends. Through the four weeks of fiscal August, comparable store sales declined 2.7 percent, a significant improvement from the 7.1 percent decline in the second quarter. The company attributes this improvement to better and more localized assortments in athletic footwear.
Consequently, Shoe Station Group has lowered its Fiscal 2026 guidance. The company now anticipates net sales of $1.100 billion to $1.111 billion, representing a decline of approximately 2 to 3 percent versus Fiscal 2025. The company also updated its adjusted diluted earnings per share (Adjusted EPS) guidance to $0.75 to $0.90. The company expects to end Fiscal 2026 with no debt and $131.6 million in cash and marketable securities.
