Revenue: As of FY2027 Q2, the actual value is USD 165.5 M.

EPS: As of FY2027 Q2, the actual value is USD 0.06.

EBIT: As of FY2027 Q2, the actual value is USD -972 K.

Net Income

For the second quarter ended August 1, 2026, The Cato Corporation reported net income of $1.1 million, a decrease from $6.8 million for the second quarter ended August 2, 2025. For the six months ended August 1, 2026, net income was $10.5 million, an increase from $10.1 million for the six months ended August 2, 2025.

Segment Revenue

Retail sales for the second quarter ended August 1, 2026, decreased by 6% to $163.9 million from $174.7 million in the prior year, primarily due to a 3.7% same-store sales decrease. For the six months ended August 1, 2026, retail sales were $333.3 million, a 2.9% decrease from $343.1 million in the prior year, primarily due to flat same-store sales and the impact of closed stores. Other revenue, principally from finance, late fees, and layaway charges, was $1.6 million for the second quarter of 2026, down from $1.9 million in the prior year quarter. For the six months, other revenue was $3.3 million in 2026, down from $3.7 million in 2025.

Gross Margin

Gross margin decreased to 32.8% of sales ($53,722 thousand) for the second quarter ended August 1, 2026, from 36.2% of sales ($63,186 thousand) in the prior year quarter, due to lower merchandise margins and deleveraging of occupancy costs. Year-to-date gross margin decreased to 35.0% of sales ($116,792 thousand) from 35.6% of sales ($122,288 thousand) in the prior year, primarily due to lower merchandise margins and deleveraging of occupancy costs.

Operating Costs and Expenses

Cost of goods sold was $110,180 thousand (67.2% of sales) for the second quarter of 2026, compared to $111,467 thousand (63.8% of sales) in the second quarter of 2025. For the six months, cost of goods sold was $216,520 thousand (65.0% of sales) in 2026, compared to $220,784 thousand (64.4% of sales) in 2025. Selling, general and administrative (SG&A) expenses as a percent of sales increased to 33.0% ($54,047 thousand) for the second quarter of 2026, from 32.8% ($57,371 thousand) in the prior year, with a $3.3 million decrease primarily due to lower payroll costs and credit card fees. Year-to-date SG&A expenses were 32.4% of sales ($107,977 thousand) in 2026, down from 32.8% of sales ($112,696 thousand) in the prior year, reflecting a $4.7 million decrease primarily from lower payroll, equipment, and insurance costs, partially offset by professional fees and litigation costs. Depreciation expenses were $2,246 thousand for the second quarter of 2026, compared to $2,525 thousand in the prior year quarter. For the six months, depreciation was $4,482 thousand in 2026, compared to $5,089 thousand in 2025. Interest and other income was - $2,268 thousand for the second quarter of 2026, compared to - $1,393 thousand in the prior year quarter. For the six months, interest and other income was - $3,501 thousand in 2026, compared to - $2,594 thousand in 2025. Income before income taxes was $1,296 thousand for the second quarter of 2026, down from $6,539 thousand in the prior year quarter. For the six months, income before income taxes was $11,127 thousand in 2026, up from $10,776 thousand in 2025.

Income Tax Expense

Income tax expense for the second quarter of 2026 was $147 thousand, compared to an income tax benefit of - $293 thousand in the prior year. For the first half of 2026, income tax expense increased to $669 thousand from $635 thousand last year.

Store Operations

During the second quarter ended August 1, 2026, The Cato Corporation closed eight stores. As of August 1, 2026, the Company operated 1,057 stores in 31 states, down from 1,101 stores in 31 states as of August 2, 2025.

Balance Sheet (as of August 1, 2026 vs. January 31, 2026)

Cash and cash equivalents increased to $35,115 thousand from $16,788 thousand. Short-term investments increased to $58,650 thousand from $56,859 thousand. Accounts receivable - net decreased to $20,459 thousand from $25,462 thousand. Merchandise inventories decreased to $82,487 thousand from $83,696 thousand. Total Current Assets increased to $208,463 thousand from $193,267 thousand. Property and Equipment - net decreased to $51,730 thousand from $53,748 thousand. Total Assets increased to $423,438 thousand from $421,419 thousand. Total Current Liabilities increased to $105,640 thousand from $102,385 thousand. Stockholders’ Equity increased to $167,905 thousand from $157,314 thousand.

Outlook

The Cato Corporation expects negative pressure on customers’ discretionary income to continue due to persistent inflation, higher fuel prices, and elevated interest rates. Management anticipates the back half of 2026 to be challenging. The company plans to tightly manage expenses and inventory.