EARNINGS PER SHARE


	Fiscal year ended
		January 3, 2026		December 28, 2024		December 30, 2023
		(53 weeks)		(52 weeks)		(52 weeks)
Weighted-average number of common and common equivalent shares outstanding:
Basic number of common shares outstanding		35,404,506		35,524,378		36,589,922
Dilutive effect of equity awards		414		1,238		3,344
Diluted number of common and common equivalent shares outstanding		35,404,920		35,525,616		36,593,266
Earnings per share:
(dollars in thousands, except per share data)
Basic net income per common share:
Net income		$	91,796	$	185,509	$	232,500
Income allocated to participating securities		(2,306)		(3,679)		(4,285)
Net income available to common shareholders		$	89,490	$	181,830	$	228,215
Basic net income per common share		$	2.53	$	5.12	$	6.24

Diluted net income per common share:
Net income		$	91,796	$	185,509	$	232,500
Income allocated to participating securities		(2,306)		(3,679)		(4,285)
Net income available to common shareholders		$	89,490	$	181,830	$	228,215
Diluted net income per common share		$	2.53	$	5.12	$	6.24

Anti-dilutive shares excluded from dilutive net income per share calculations (*)		261,468		422,865		477,373

(*)The anti-dilutive shares excluded from diluted net income per common share primarily relate to out-of-the-money stock options.

The Company grants shares of its common stock in the form of restricted stock awards to certain key employees under the Company’s Amended and Restated Equity Incentive Plan (see Note 12, Stock-based Compensation, to the consolidated financial statements). Prior to vesting of the restricted stock awards, the grant recipients are entitled to receive non-forfeitable cash dividends if the Company declares and pays dividends on the Company’s common stock. Accordingly, unvested shares of the Company’s restricted stock awards are deemed to be participating securities for purposes of computing diluted earnings per share (EPS), and therefore the Company’s diluted EPS represents the lower of the amounts calculated under the treasury stock method or the two-class method of calculating diluted EPS.

About Earnings Per Share Disclosures

The earnings per share disclosure breaks down the calculation from net income to both basic and diluted EPS, revealing the full impact of a company's capital structure on per-share economics. The reconciliation between basic and diluted share counts exposes how many stock options, RSUs, convertible securities, and warrants are potentially dilutive to existing shareholders.

Key signals: a widening gap between basic and diluted shares indicates growing dilution from equity compensation or convertible instruments. Anti-dilutive securities excluded from the diluted calculation deserve attention — they represent latent dilution that will materialize if the stock price rises. Watch for the effect of share buybacks on per-share metrics: EPS growth driven primarily by repurchases rather than income growth signals weakening fundamentals. Compare year-over-year changes in the diluted share count against equity compensation expense to assess whether management is effectively managing dilution.

CARTERS INC Earnings Per Share Disclosure

About Earnings Per Share Disclosures

Other Available Disclosures