Carter's, Inc.

 	

 
 

 


April 4, 2025
Dear Fellow Shareholders,
Carter’s continues to lead the market in young children’s apparel in North America. Our strong brand
portfolio, unique multi-channel business model and significant consumer equity have enabled the
largest market share in our product space in each of the United States, Canada and Mexico.
Our focus is on providing high quality apparel and related products for children, ranging from
newborn up to 10 years of age. We do so through what we consider to be the strongest brand assets in
the market.
The Carter
s brand was founded in 1865 and the OshKos
K
h B
gosh brand in 1895. Generations of
consumers know and trust our brands for their quality, value and style. We also own Just One You,
Child of Mine and Simple Joys
o
, brands we developed exclusively for Target, Walmart and Amazon,
respectively. In recent years, we introduced Little Planet, which we believe has quickly become the
market leading brand focused on organic fabrics and sustainable materials. Skip Hop is a global
lifestyle brand serving families with young children across a variety of product categories including
home gear, b
r
athtime, playtime and travel accessories.
Our multi-channel business model provides our Company with significant market reach. Through our
wholesale channel, we distribute our products through the largest, most successful retailers in North
America, representing more than 19,000 points of distribution. We have a significant direct-to-
consumer business also, operating over 1,000 retail stores and integrated eCommerce websites in
North America which make the full range of our product offerings available to consumers in a
convenient, easy-to-shop way. In addition to our businesses in the U.S., Canada and Mexico, our
products are available in over 90 additional countries.
2024 Results
Last year we delivered the following results for fiscal year 2024:


$2.8 billion in consolidated net sales;


Share growth in the baby and toddler markets in the United States;


$287 million of adjusted operating income1;


$5.81 of adjusted diluted earnings per share1;


$299 million of operating cash flow;


$167 million distributed to shareholders through dividends and share repurchases;


6% reduction in inventories, and;


$1.3 billion of total liquidity at year end.

2
While our products and brands have broad market appeal, our customers tend to be those currently
having and raising children. These consumers are generally young, in their late twenties and early
thirties, with household incomes of approximately $80,000. The last several years have been
challenging for these families for a number of reasons – including managing through historic inflation
across many goods and services on which they depend and uncertainty regarding the outlook for the
economy, as evidenced by the ongoing volatility in various national consumer confidence surveys. We
believe these pressures and concerns have dampened demand for our brands in recent years.
Our challenge is to grow our business and deepen our relationship with the consumer amid this
backdrop. In uncertain times, brands that consumers know and trust, such as Carter
s and OshKos
K
h
B
go


sh, matter even more. Our Company has proven over the decades its staying power and
adaptability whether it be in the face of uneven economic cycles or various unexpected events such as
the Covid global pandemic.
Business Review
Over the past several months, with the assistance of outside industry experts, we have been engaged
in a comprehensive assessment of our business. The objective of this review has been to identify the
most meaningful growth opportunities available to Carter’s and to scope the strategies and
investments required to realize them in the coming years.
This review highlighted many strengths, including our brand assets, significant awareness and equity
with consumers and the unique reach of our multi-channel business model. It also identified a number
of opportunities to improve the focus and appeal of our product offerings in order to capture new
customer segments and market share going forward.
Based on learnings from the review, we are pursuing enhancements to our operating model, which
includes improving our product and brand development processes to be faster,r nimbler and more
rapidly respond to changing consumer preferences. We have begun investing behind this foundational
operating model work, which we believe has significant potential to drive our business going forward.
We also plan to continue to manage spending prudently and pursue additional opportunities to
enhance productivity throughout the business.
Our Focus and Path Forward
Our mission is to serve the needs of families with young children, with a vision to be the world’s
favorite brands in young children’s apparel and related products. Our growth agenda is centered on
the following three fundamental areas:

3


Elevate the style and value of our product offerings
Everything we do at Carter’s starts with product. Our focus on young children’s apparel has led to
deep expertise in developing and distributing compelling product assortments that appeal
broadly across the marketplace.
It is important that our product assortments continually evolve to ensure we remain as relevant
and appealing to the current generation of consumers raising children as they have been to the
generations which came before. To this end, we see an opportunity to elevate the style and value
of our product offer
ff
ings.
On the style dimension, our talented design and merchandising teams continue to evolve the
aesthetic and taste level of our assortments, incorporating the latest trends in fashion, color,
artwork and fabrications – ‘from Paris to playground!’ In recent years, these products with
enhanced style have become a more significant proportion of our assortment and have been
among our best sellers. Additionally, over time, we anticipate that an increasing portion of our
product assortment will be exclusive to our retail business, creating additional reasons for
consumers to shop with us in our direct-to-consumer channels versus other market alternatives.
The concept of value is always of great importance in the young children’s apparel category. We
engineer our products to represent extraordinary value – a significant differ
ff
entiation of our brands
versus other products in the market. Value has many dimensions, including quality, safety,
functionality and price. Experienced parents know they can trust our products to pass the test of
time – multiple washings and the challenges posed by active, young children. Our price points are
sharp and competitive; our customers know they are getting a great deal when purchasing our
products. We are committed to maintaining strong credibility across these various aspects of value
in how we develop, assort and market our products.
Building on the strong legacy foundation of Carter
s and OshKos
K
h B
go


sh, we have a history of
successfully developing new brands at Carter’s. Our research has shown that consumers typically
purchase multiple apparel brands for their children. Accordingly, we have adopted a ‘house of
brands’ strategy, particularly in our retail business, with the intent of offering multiple distinct but
complementary brands as part of our assortment. Over time, we plan to develop this strategy
further as a way of broadening the appeal of our products and thereby reach more of the
marketplace, including some consumer segments which we do not serve today.

4


Improve our marketing capabilities and effectiveness
Our marketing investments are targeted at acquiring new customers, deepening relationships with
our existing customers and extending our customers’ tenure with our brands in order to drive
awareness, engagement and ultimately sales.
Recent areas of investment include brand marketing, building personalization capabilities in order
to enable offerings and promotions tailored to individual consumer needs, a rebranded and
relaunched customer loyalty program and enhanced digital and social media programs. We also
continue to invest in improving and enhancing our consumer-facing technologies such as our
websites and mobile app.


Leverage our unparalleled multi-channel market presence to exte
x
nd the reach of our brands
Our global, multichannel business model is unique. No other children’s apparel company in the
world has our combined capabilities in the retail store, online and wholesale channels.
We are the largest specialty retailer in North America focused on young children’s apparel. Our
stores span the United States, Canada and Mexico in a variety of formats – outlet stores,
convenient ‘close to home’ stores typically in high-traffic strip centers and mall stores. Stores are
an important part of our business and they are important to consumers too, as nearly 70% of
children’s apparel in the broader market is bought in-store. Our stores are also well integrated with
our eCommerce business, providing omni-channel capabilities enabling convenient shopping
experiences across the store and online channels.
We are increasingly focused on improving the productivity of our existing store fleet. We stepped
up the pace of store remodels this past year and have seen a measurable lift in sales from these
investments. While new stores continue to perfor
f
m well and generate good returns on investment,
we think we will be managing a relatively constant number of stores of our current model over the
next several years, with closures largely offse
ff
tting new and relocated store locations.
We continue to innovate the in-store experience and evaluate new, alternate store formats. In
2024, we opened our first-ever flagship store in Atlanta, which includes compelling presentations
of our market-leading brands, in-store shops for baby, toddler, kids, and Little Planet, modern
digital displays, a gifting station and community engagement events, all intended to attract the
next generation of consumers. We believe learnings from the ongoing innovations at our flagship
store will inspire improvements in brand presentation and customer experience across the rest of
our store portfolio.

5
Wholesale remains an important part of our strategy which targets broad distribution of our
brands, particularly in the United States where we are the largest supplier of young children’s
apparel to the largest retailers in the country.
Our portfolio of wholesale customers has evolved significantly in recent years, reflecting changes
in consumer traffic trends and preferences. Mass channel retailers such as Target, Walmart and
Amazon have grown in importance to consumers and to our business. In 2024, sales of our
exclusive brands to these retailers reached a record level. This strong demand for our exclusive
brands has been offset, though, by lower demand from other customers, particularly department
stores.
We expect the wholesale customer landscape will continue to evolve in future years. We plan to
continue to prioritize the development of strong product offerings and partnerships with those
retailers winning with consumers.
Leadership Transition
Earlier this year we announced that Michael D. Casey had decided to retire after over 30 years with
Carter’s and more than 16 years as our Chief Executive Officer. On behalf of our Board of Directors and
thousands of employees, we thank Mike for his decades of dedicated service and many contributions
to Carter’s.
After a comprehensive search, we recently announced that Douglas C. Palladini has been appointed
Chief Executive Officer and President and a member of the Board of Directors, effective April 3, 2025.
He previously served as Global Brand President of Vans, a division of V.F. Corporation. Doug’s
remarkable track record of growing brands, deep understanding of consumer-driven strategies and
expertise in creating global brand connections will be invaluable as we continue to build on Carter’s
strong foundation.
In closing, our objective is to return Carter’s to consistent, profitable growth and to create value for our
shareholders. Historically, these have been hallmarks of our performance over a long period of time.
We have considerable brand assets, market position and overall financial resources as well as a
dedicated and motivated team actively focused on achieving these objectives.

6
We would like to thank our more than 15,000 dedicated employees around the world who execute
their responsibilities with great determination, resilience and passion for our brands and our mission
of serving families with young children.
On behalf of our employees, Board of Directors and Leadership Team, thank you for your investment in
Carter’s.
Sincerely,
William J. Montgoris
Non-Executive Chairman of the Board
Richard F. Westenberger
Senior Executive Vice President,
Chief Financial Officer & Chief Operating Officer
1 A non-GAAP measure. See the Appendix to the Proxy Statement for a presentation of, and reconciliation to, the most directly comparable
GAAP
A
financial measure.

Proxy Statement
Proxy Statement
Proxy
2025

[THIS PAGE INTENTIONALLY LEFT BLANK]

April 4, 2025
Dear Shareholder,
It is my pleasure to invite you to attend our 2025 Annual Meeting of Shareholders on Wednesday, May 14,
2025 (the 
Annual Meeting). The meeting will be held in a virtual format.
The attached 2025 Notice of Annual Meeting of Shareholders and Proxy Statement describe the formal
business to be conducted at the meeting. Whether or not you plan to attend the Annual Meeting, your
shares can be represented if you promptly submit your voting instructions over the internet, by
telephone, by completing, signing, dating, and returning your proxy card in the enclosed envelope, or by
following the instructions you have received from your broker or other nominee.
On behalf of our Board of Directors and Leadership Team, thank you for your investment in Carter's, Inc.
Sincerely,
William J. Montgoris
Non-Executive Chairman of the Board
Proxy


2025 NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
This Meeting Notice highlights information described in other parts of this 2025 Proxy Statement and does not
contain all information you should consider in voting. Please read the entire 2025 Proxy Statement carefully before
voting.
To our shareholders,
You are invited to attend our 2025 Annual Meeting to be held as follows in a virtual meeting format:
ITEMS OF BUSINESS
Item
Board's
Recommendation
Voting Approval
Standard
Effect of Abstention
Effect of Broker Non-
Vote
Election of 11 nominated
directors
FOR
More votes 
For than
"Against"
No effect
No effect
Advisory approval of
compensation of named
executive officers
FOR
More votes 
For than
"Against"
No effect
No effect
Ratification of
appointment of
PricewaterhouseCoopers
LLP for fiscal 2025
FOR
Majority of votes
properly cast at the
meeting
No effect
Not applicable
In addition, at the Annual Meeting we will conduct any other business that may properly come before the meeting. See
Question18 of the 
Questions and Answers About the 2025 Annual Meeting beginning on page 78 for more information.
PROXY SOLICITATION
The Board solicits the enclosed proxy for the 2025 Annual Meeting and any adjournment or postponement of the 2025
Annual Meeting. Any proxy may be revoked at any time prior to its exercise at the 2025 Annual Meeting.
VOTING
You may vote if you held shares of Carter's common stock as of the record date (March 20, 2025). You are able to vote your
shares by providing instructions to the proxy holders who will then vote in accordance with your instructions. We urge you
to read the 2025 Proxy Statement carefully and to vote in accordance with the recommendations of the Board.
QUESTIONS AND ANSWERS ABOUT THE 2025 ANNUAL MEETING
We encourage you to review the section "Questions and Answers About the 2025 Annual Meeting" for answers to common
questions about the virtual meeting, proxy materials, voting, and other topics.
By order of the Board of Directors,
Secretary
Approximate Date of Mailing of Proxy
o
Materials or Notice of Internet Availability:
April 4, 2025
Time and Date
Wednesday, May 14, 2025
1:00 p.m. Eastern Time
Access to Virtual Meeting
Register at www.proxydocs.com/CRI
Record Date
March 20, 2025
Proxy


TABLE OF CONTENTS
BOARD OF DIRECTORS AND CORPORATE GOVERNANCE INFORMATION
2
PROPOSAL NUMBER ONE  ELECTION OF DIRECTORS
26
COMPENSATION OF DIRECTORS
27
EXECUTIVE OFFICERS BIOGRAPHICAL INFORMATION AND EXPERIENCE
29
COMPENSATION DISCUSSION AND ANALYSIS
34
COMPENSATION & HUMAN CAPITAL COMMITTEE REPORT
52
COMPENSATION & HUMAN CAPITAL COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
52
FISCAL 2024 SUMMARY COMPENSATION TABLE
53
FISCAL 2024 GRANTS OF PLAN-BASED AWARDS
55
OUTSTANDING EQUITY AWARDS AT FISCAL 2024 YEAR-END
57
OPTION EXERCISES AND STOCK VESTED IN FISCAL 2024
59
NONQUALIFIED DEFERRED COMPENSATION
60
POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE OF CONTROL
61
PAY RATIO DISCLOSURE
64
PAY VERSUS PERFORMANCE DISCLOSURE
65
TRANSACTIONS WITH RELATED PERSONS, PROMOTERS, AND CERTAIN CONTROL PERSONS
69
SECURITIES OWNERSHIP OF CERTAIN BENEFICIAL OWNERS, DIRECTORS, AND EXECUTIVE
OFFICERS
70
DELINQUENT SECTION 16 REPORTS
72
PROPOSAL NUMBER TWO  ADVISORY VOTE ON APPROVAL OF EXECUTIVE COMPENSATION
73
AUDIT COMMITTEE REPORT
74
PROPOSAL NUMBER THREE  RATIFICATION OF INDEPENDENT REGISTERED PUBLIC
ACCOUNTING FIRM
75
OTHER MATTERS
77
QUESTIONS AND ANSWERS ABOUT THE 2025 ANNUAL MEETING
78
APPENDIX
85


FORWARD-LOOKING STATEMENTS
Statements contained in this proxy statement that are not historical fact and use predictive words such as

estimates, 
outlook, 
guidance, 
expect, 
believe, 
intend, 
designed, 
target, 
plans, 
may, 
will,

are confident and similar words are forward-looking statements (as such term is defined in the Private
Securities Litigation Reform Act of 1995). These forward-looking statements and related assumptions involve
risks and uncertainties that could cause actual results and outcomes to differ materially from any forward-
looking statements or views expressed in this proxy statement. These risks and uncertainties include, but are not
limited to, those discussed in the subsection entitled 
Risk Factors under Part I, Item 1A, of our most recent
Annual Report on 10-K, and otherwise in our reports and filings with the Securities and Exchange Commission, as
well as the following factors: changes in global economic and financial conditions, and the resulting impact on
consumer confidence and consumer spending, as well as other changes in consumer discretionary spending
habits; risks related to public health crises; risks related to consumer tastes and preferences, as well as fashion
trends; the failure to protect our intellectual property; the diminished value of our brands, potentially as a result
of negative publicity or unsuccessful branding and marketing efforts; delays, product recalls, or loss of revenue
due to a failure to meet our quality standards; risks related to uncertainty regarding the future of international
trade agreements; increased competition in the marketplace; financial difficulties for one or more of our major
customers; identification of locations and negotiation of appropriate lease terms for our retail stores; distinct
risks facing our eCommerce business; failure to forecast demand for our products and our failure to manage our
inventory; increased margin pressures, including increased cost of materials and labor and our inability to
successfully increase prices to offset these increased costs; continued inflationary pressures with respect to labor
and raw materials and global supply chain constraints that have, and could continue, to affect freight, transit,
and other costs; fluctuations in foreign currency exchange rates; unseasonable or extreme weather conditions;
risks associated with corporate responsibility issues; our foreign sourcing arrangements; a relatively small
number of vendors supply a significant amount of our products; disruptions in our supply chain, including
increased transportation and freight costs; our ability to effectively source and manage inventory; problems with
our Braselton, Georgia distribution facility; pending and threatened lawsuits; a breach of our information
technology systems and the loss of personal data or a failure to implement new information technology systems
successfully; unsuccessful expansion into international markets; failure to comply with various laws and
regulations; failure to properly manage strategic initiatives; retention of key individuals; acquisition and
integration of other brands and businesses; failure to achieve sales growth plans and profitability objectives to
support the carrying value of our intangible assets; our continued ability to meet obligations related to our debt;
changes in our tax obligations, including additional customs, duties or tariffs; our continued ability to declare
and pay a dividend; volatility in the market price of our common stock; and the cost or effort required for our
shareholders to bring certain claims or actions against us, as a result of our designation of the Court of Chancery
of the State of Delaware as the sole and exclusive forum for certain types of actions and proceedings. Except for
any ongoing obligations to disclose material information as required by federal securities laws, the Company
does not undertake any obligation to publicly update or revise any forward-looking statements, whether as a
result of new information, future events, or otherwise. The inclusion of any statement in this proxy statement
does not constitute an admission by the Company or any other person that the events or circumstances
described in such statement are material.
1
Proxy

BOARD OF DIRECTORS AND CORPORATE GOVERNANCE
INFORMATION
Each of our directors stands for election annually and thereafter holds office for a one-year term. At our
Annual Meeting, we are asking our shareholders to elect the 11 proposed nominees set forth below,
including Douglas C. Palladini, who was appointed as our Chief Executive Officer & President and a
member of the Board of Directors effective April 3, 2025. The following table and charts show the
committee assignments of each of our independent director nominees, information regarding the
composition of Carter's Board of Directors (the 
Board), the definition of skills used for our Board skills
matrix, the Board skills matrix, and a chart showing the skills and experience held by the Board.
Director
Audit
Compensation
& Human
Capital
Nominating &
Corporate
Governance
Business
Transformation
Rochester Anderson, Jr.

Jeffrey H. Black

Hali Borenstein


Luis Borgen


Jevin S. Eagle
ℂ
Mark P. Hipp


William J. Montgoris
ℂ
Stacey S. Rauch



Gretchen W. Schar
ℂ

Stephanie P. Stahl


ℂ
ℂ= Chair
 = Member
2

DIRECTOR SKILLS MATRIX
The Board believes that the combination of backgrounds, skills, and experiences collectively possessed
by the members of the Board well-qualifies the Board to exercise oversight responsibilities on behalf of
our shareholders in light of Carter's current and future strategic plans. The following tables describe the
key skills and definitions of those skills, a breakdown of the number of directors that hold each skill, and
the self-identified skills for each independent member of our Board nominated for election at the 2025
Annual Meeting. We use the general Board membership criteria listed in our Corporate Governance
Principles, along with the desired skills and qualifications listed in the following tables, to identify,
screen, and recruit director candidates and make director nomination recommendations to the full
Board.
Skill
Definitions
Senior
Leadership
Experience in an executive officer role
Governance
Public company board experience, including more than three years on Carter's board
Retail Industry
Experience
Executive officer level experience or service on the board of directors at a retail and/
or consumer products company
Consumer
Strategy
Executive officer level experience in marketing, brand management, consumer
insights, and brand strategy, or service on the board of directors of a retail or
consumer products company
Digital /
Technology
Executive officer experience with technology, digital platforms and new media, data
security, and data analytics; or service on the board of directors of a digital
platforms, digital media, data security, or data analytics company
Financial
Expertise
Expertise with financial reporting, accounting, risk management, and capital
allocation. Qualifies as an audit committee financial expert as defined under SEC and
NYSE rules
HR and Talent
Management
Executive or board level experience in managing large workforce and/or experience
with executive compensation, employee engagement, and Chief Executive Officer
(
CEO) succession
ESG
Executive officer or board level experience with relevant environmental, social, and
governance (
ESG) matters
International
Expansion
Executive officer or board level experience in managing business operations and
growth in global markets
Global Supply
Chain
Executive officer or board level experience with a company with global supply chain
operations
3
Proxy

SKILLS AND EXPERIENCE
4
Senior Leadership
11/11
Governance
9/11
Retail Industry
Experience
9/11
Consumer Strategy
7/11
Digital Technology
5/11
Financial Expertise
5/11
HR and Talent
Management
11/11
7/11
International
Expansion
10/11
Global Supply Chain
7/11
ESG
Director Skills
Mr.
Anderson,
Jr.
Mr.
Black
Ms.
Borenstein
Mr.
Borgen
Mr.
Eagle
Mr.
Hipp
Mr.
Montgoris
Mr.
Palladini
Ms.
Rauch
Ms.
Schar
Ms.
Stahl
Senior Leadership
l
l
l
l
l
l
l
l
l
l
l
Governance
l
l
l
l
l
l
l
l
l
Retail Industry
Experience
l
l
l
l
l
l
l
l
l
Consumer Strategy
l
l
l
l
l
l
l
Digital/Technology
l
l
l
l
l
Financial Expertise
l
l
l
l
l
HR and Talent
Management
l
l
l
l
l
l
l
l
l
l
l
ESG
l
l
l
l
l
l
l
International
Expansion
l
l
l
l
l
l
l
l
l
l
Global Supply Chain
l
l
l
l
l
l
l

2025 NOMINEES FOR DIRECTOR
After considering the recommendations of the Nominating & Corporate Governance Committee, the
Board has set the number of directors at 11 and nominated all current directors to stand for re-
election. Mr. Casey retired as an officer and director in January 2025 and is not standing for re-election,
and Mr. Palladini was appointed to the Board on April 3, 2025 and is standing for re-election. The Board
believes that each of the nominees is qualified to serve as a director of Carter's and, in addition to the
skills listed in the table on page 4, certain key qualifications of each nominee that were considered by
the Board follow each nominees biographical description.
We believe that all nominees will be able and willing to serve if elected. However, if any nominee
should become unable or unwilling to serve for any reason, proxies may be voted for another person
nominated as a substitute by the Board, or the Board may reduce the number of directors.
WILLIAM J. MONTGORIS
Non-Executive Chairman
r
Director since 2007
Age: 78
Committee:

Nominating & Corporate
Governance (Chair)
Prior Public Company
Directorships:

Stage Stores, Inc. (2004 to
2020, serving as Chair of
Board from 2010 to 2020)
Willia
l
m J. Montgoris retired as Chief Operating Officer of The
Bear Stearns Companies, Inc. (
Bear Stearns) in 1999, a
position he held since August 1993, afte
f
r spending 20 years
with the company. While at Bear Stearns, Mr. Montgoris also
served as the companys Chief Financial Officer from April 1987
until October 1996. Mr. Montgoris is a trustee of the
Hackensack Meridian School of Medicine and a trustee
emeritus of Colby College and St. Johns University.
Directo
r
r Qualifications:

Valuable perspectives and insigh
i
ts with res
r
pect to fin
f ance
and accounting after spending over 20 years i
r
n the
investment banking industry.
r
His financial expe
x
rtise
provide
v
s our Board a deep understanding of fin
f ancial and
audit-rela
r
ted matters

Valuable insigh
i
t with respect to the ret
r
ail industry and the
oversight
i
of public companies
5
Proxy

ROCHESTER ANDERSON, JR.
Independent Direc
r
tor since 2022
Age: 63
Committee:

Compensation & Human
Capital
Rochester Anderson, Jr. has over 30 years of human resources
and operational experience at various public and private
corporations, including more than 15 years of experience
leading human resource organizations and more than 15 years
of operational experience with public and private corporations
and non-profit organizations. Mr. Anderson is currently Chief
Human Resources Officer, Emory Healthcare, which he joined in
September 2022. Previously, from February 2020 to September
2022, Mr. Anderson served as Chief Human Resources Officer of
AutoNation, Inc., a publicly-traded company and the nations
largest automobile dealer with over 21,000 associates, working
in over 400 locations across 18 states.
Mr. Anderson previously served as Senior Vice President, People
Solutions for the Financial Industry Regulatory Authority, from
May 2019 to February 2020, and served from 2006 to 2018 in
various human resource focused and operational roles at Cox
Automotive Inc., including serving as Chief Human Resources
Officer and Executive Vice President from 2014 to 2018. Mr.
Andersons experience focuses on human capital management,
career development and training, operational management,
and diversity and inclusion.
Direc
r
tor Qualifications:

Sign
i
ificant human capital management, organizational
improvement, compensation and benefits,
f
and executive
management expe
x
rience


Valuable insights
i
into workforce dyna
y
mics, diversity, equity
and inclusion, and executive development


Substantial operational exp
e
erie
r nce in retail and consumer-
focused businesses
6

JEFFREY H. BLACK
Independent Direc
r
tor since 2022
Age: 70
Committee:

Audit
Other Public Company
Directorships:

Otis Worldwide Corp. since
2020 (Chair, Audit Committee;
Member, Nominations and
Governance Committee)
Jeffre
f
y H
e
. Black served as Senior Partner and Vice Chairman of
Deloitte LLP from 2002 to 2016 and as Partner-in-Charge of
Arthur Andersen LLPs Metro New York audit practice from 1988
to 2002. Mr. Black has 40 years of experience leading teams
serving those firms largest and most complex global clients.
Direct
r
or Qualifications:


Sign
i
ificant accounting, financial reporting, and executive
leadership
r
experienc
r
e, as well as valuable insight
i
s i
t
nto risk
r
and crisis m
i
anagement and oversigh
i
t of publicly-traded,
global businesses

Valuable experien
r
ce in cyber and informa
f
tion governa
r
nce
oversight and has earned a Computer Emergency Readiness
Team (CERT) Certificate in Cybersecurit
y
y O
t
versigh
i
t issued
i
by
the CERT Division of the Software Engineering Institute at
Carnegie Mellon University,
t
as well as the National
Association of Corporate Direct
r
ors master course in
Cybersecurityt
HALI BORENSTEIN
Independent Director since 2019
Age: 40
Committee:

Business Transformation


Nominating & Corporate
Governance
Hali B
l
oren
r
stein is the Chief Executive Officer of Reformation
LLC, a womens lifestyle brand focused on fashion and
sustainability, a position she has held since June 2020. From
December 2017 until June 2020, Ms. Borenstein was President
of Reformation LLC, and from 2014 to 2017, Ms. Borenstein held
various merchandising and design roles of increasing
responsibility at Reformation LLC. Prior to joining Reformation
LLC, Ms. Borenstein was a senior merchandiser at Gymboree
Group, Inc., and began her career at Bain & Company.
Direc
r
tor Qualifications:

Deep strategic and leadership experience
r
in a consumer-
focused
f
retail apparel business

Valuable perspective and insigh
i
t in eCommerce, brand
marketing, sustainability, a
y
nd retail businesses

Expa
x
nsive exp
e
ertise in apparel marke
r
ting and
merchandising
7
Proxy

LUIS BORGEN
Independent Direc
r
tor since 2021
Age: 55
Committees:

Audit

Compensation & Human
Capital
Other Public Company
Directorships:

Eastern Bankshares, Inc.,
since 2016

Synopsys, Inc., since 2022
Luis Borgen has over 25 years of finance and operational
experience at various public and private equity-backed
companies. He was the Chief Financial Officer of athenahealth,
Inc., a healthcare technology company from 2019 to 2022. Prior
to that, he was Chief Financial Officer for Vistaprint, an e-
commerce company that produces marketing products for
small and microcap businesses, from 2017 to 2019. Prior to
that, he served from 2012 to 2017 as Chief Financial Officer for
DAVIDsTEA Inc., a specialty tea retailer in the United States and
Canada that became publicly-traded in 2015, and from 2010 to
2012 he served as Chief Financial Officer of DaVita Inc.
(
DaVita), a publicly traded healthcare provider. Prior to
DaVita, Mr. Borgen spent 13 years at Staples, Inc. culminating
in his role as Senior Vice President Finance and Chief Financial
Officer for the U.S. Retail division. Mr. Borgen began his career
as an officer in the U.S. Air Force.
Direct
r
or Qualifications:


Broad exp
e
erience
r
in finance, accounting, capital marke
r
ts,
investor relations, M&A and international exp
e
ansion


Meaningful expe
x
rience in the oversight
r
of executive
compensation, risk management, and corporate
governa
r
nce


Substantial operational exp
e
erie
r nce in retail and consumer-
focused businesses
8

JEVIN S. EAGLE
Independent Direc
r
tor since 2010
Age: 58
Committee:

Compensation & Human
Capital (Chair)
Jevin S
i
. Eagle has served as Professor of the Practice, Strategy
and Innovation, and Executive Director of Social Impact
Initiatives for Boston Universitys Questrom School of Business
since September 2022, and as Chief Executive Officer of Boston
University Hillel since 2017. Mr. Eagle served as Chief Executive
Officer and director of DAVIDsTEA Inc., a specialty tea retailer
in the United States and Canada, from April 2012 to April 2014.
Mr. Eagle previously held several senior leadership positions at
Staples, Inc. from 2002 to 2012, including Executive Vice
President, Merchandising and Marketing. Prior to joining
Staples, Inc., Mr. Eagle worked for McKinsey & Company, Inc.
from 1994 to 2001, ultimately serving as a partner in the firms
retail practice.
Direct
r
or Qualifications:

Broad expe
x
rience in a number of areas as the for
f
mer
r
Chief
Executive Officer and direc
r
tor of DAVI
D
DsTEA
T
Inc. and
Executive Vice Presid
r
ent, Merchandisi
i ng and Marke
r
ting of
Staples, Inc., including retail, management, merch
r
andising,
sourcing, strategic planning, and brand marketing

Valuable experience
r
with developing strategies and
programs for
f
teaching social impact business education,
including matters relating to envir
v onmental, social, a
l
nd
governa
r
nce (ESG through his role as Professor
f
and
Executive Director
r
of Social Impact Initiatives for
f
Boston
University's Questrom School of Business

Meaningful expe
x
rience in business strategy and the retail
industry provides our Board with critical insigh
i
ts
9
Proxy

MARK P. HIPP
Independent Direc
r
tor since 2018
Age: 63
Committees:

Audit

Compensation & Human
Capital
Mark P. Hipp has been the Chief Executive Officer of H2IDD,
an advisory firm focused on public and private mergers and
acquisitions since January 2013. From November 2013 until
April 2017, Mr. Hipp was the operating partner at Sterling
Partners, a private equity firm. Prior to that, he spent over 28
years at Hewlett Packard Enterprise Company, most recently
as Vice President & General Manager, HP Software and Global
Networking Business Management.
Director Qualifications:

Valuable perspective and insigh
i
t with res
r
pect to issues
relating to infor
f
ma
r
tion technology, i
y ncluding cybe
c
rsecurityt
and eCommerce, as well as global supply chain and
logistics

Meaningful expe
x
rience in strategic growth transactions
including through investments,
t
strategic relationships, and
mergers and acquisiti
i
ons
DOUGLAS C. PALLADINI
Director since 2025
Age: 58
Douglas C. Palladini joined Carters on April 3, 2025 as Chief
Executive Officer & President and a member of the Board. Mr.
Palladini served as the founder and owner of Kickstand, LLC,
a consulting and advisory business focused on brand and
consumer strategy, from April 2022 until March 2025. Prior to
founding Kickstand, LLC, from June 2004 to March 2022, Mr.
Palladini served in various roles of increasing responsibility
at Vans, a subsidiary of V.F. Corporation, culminating in his
role as Global Brand President of Vans from July 2016
through March 2022.
Direct
r
or Qualifications:

Deep exp
e
erie
r nce with growing brands a
d
nd consumer-
driven
r
strategies, and expe
x
rtise in creating global brand
connections


Valu
V
able perspective as an executive with decades of
experience
r
working in the ret
r
ail and apparel
r
industry and
operating within multiple sales channels
10

STACEY S. RAUCH
Independent Director
r
since 2022
Age: 67
Committees:

Audit

Business
Transformation


Nominating &
Corporate
Governance
Other Public Company
Directorships:

Heidrick & Struggles
International, Inc. since
2019
Prior Public Company
Directorships:

Ascena Retail Group (2017
to 2021)

Land Securities Group PLC
(2012 to 2021)


Fiesta Restaurant Group,
Inc. (2012 to 2023) (Chair
from 2017 to 2023)
Stacey S. Rauch is a Senior Partner Emeritus of McKinsey &
Company (
McKinsey). Ms. Rauch was a leader in McKinseys
Retail and Consumer Goods Practices, served as Head of the
North American Retail and Apparel Practice, and as Global
Retail Practice Convener. A 24-year veteran of McKinsey, Ms.
Rauch led engagements for a wide range of retailers, apparel
wholesalers, and consumer goods manufacturers in the U.S.
and internationally. Ms. Rauch was a co-founder of McKinseys
New Jersey office and was the first woman at McKinsey
appointed as an industry practice leader. Since retiring from
McKinsey, Ms. Rauch has served as a member or chair of various
companies boards.
Direct
r
or Qualifications:


Strategic leadership
r
expertise and deep experienc
r
e in
internat
r
ional business with a significant focus on the retail,
apparel, and consumer goods industries


Meaningful expe
x
rience in the oversight
r
of executive
compensation, corporate governa
r
nce, and financial
reporting
11
Proxy

GRETCHEN W. SCHAR
Independent Direc
r
tor since 2019
Age: 70
Committee:

Audit (Chair)

Business Transformation
Other Public Company
Directorships:

Cincinnati Financial Corp.
since 2002
Gretchen W. Schar served as Executive Vice President and
Chief Financial and Administrative Officer of Arbonne
International LLC, a beauty and nutritional products company,
from 2011 until 2018 and from 2008 until 2011 served as
Executive Vice President and Chief Financial Officer of
philosophy, inc., an international prestige beauty brand. Prior
to that, Ms. Schar spent over 30 years at The Procter & Gamble
Company in finance, general management, and global
operations roles of increasing responsibility.
Directo
r
r Qualifications:


Broad experie
r nce in fin
f ance, accounting, auditing and
financial rep
r
orting, capital management, investor relations,
and global operations


Meaningful expe
x
rience with strategic growth, including
mergers and acquisitions
i


Sign
i
ificant public company board oversight
r
experie
r nce,
including in fin
f ancial and accounting controls, public
company reporting, engagement with independent public
accounting fir
f ms,
r
corporate governanc
r
e, and executive
compensation
12

STEPHANIE P. STAHL
Independent Direc
r
tor since 2022
Age: 58
Committees:

Business Transformation
(Chair)


Compensation & Human
Capital

Nominating &
Corporate
Governance
Other Public Company
Directorships:

Dollar Tree, Inc., since 2018

Newell Brands, Inc., since
2023

Edgewell Personal Care
Company, since 2024
Prior Public Company
Directorships:

Knoll, Inc. (2013 to 2021)
Stephanie P. Stahl is currently a Senior Advisor and Executive
Coach at the Boston Consulting Group (since 2022), and is a
former Global Marketing & Strategy Officer of Coach, Inc,
where she served from 2012 through 2015. She is the Founder
of her investment and advisory company Studio Pegasus LLC,
which she launched in 2015 to focus on supporting early-stage
consumer ventures. Ms. Stahl previously held executive
positions at several leading retail and consumer products
companies and served as a Partner at The Boston Consulting
Group from 1992 until 2003.
Direct
r
or Qualifications:


Signif
i
ica
f
nt experience
r
in the retail/con
/
sumer sector
including exp
e
erie
r nce developing, executing, and optimizing
major change initiatives including fundam
f
ental business
transformations, m
s
ergers and acquisitio
i
ns, and post-
merger integrations


Deep experience
r
in marketing, data analytics, digital
strategy,
g
sustainability, b
y
rand building, and strategy


Meaningful expe
x
rience in the oversight
r
of corporate
governa
r
nce, investor engagement, a
t
nd ESG
13
Proxy

BOARD LEADERSHIP STRUCTURE
Carters Corporate Governance Principles provide that the positions of Chairman and Chief Executive
Officer may be combined if the non-management directors determine it is in the best interest of
Carter's. While Carter's had previously combined the Chief Executive Officer and Chairman of the Board
roles since 2009, in connection with Mr. Casey's retirement as an officer and director in January 2025,
Mr. Montgoris, who has served as our Lead Independent Director since May 2022, was appointed as Non-
Executive Chairman. The Board currently believes that a separate Chairman and Chief Executive Officer
leadership structure is appropriate at this time to enable the Chief Executive Officer to focus on
executing on the strategic direction and operation of the Company, while allowing the Non-Executive
Chairman to focus on day-to-day management of Board matters. However, the Board may choose to
change this separation of roles if it determines to be best for the Company under the then existing
circumstances. Should the Chairman of the Board position be held by the CEO, the Board will appoint a
lead independent director as required under the Company's Corporate Governance Principles.
DIRECTOR INDEPENDENCE
The New York Stock Exchange (
NYSE) listing standards and Carters Corporate Governance Principles
require a majority of Carters directors to be independent from Carter's and Carters management. For a
director to be considered independent, the Board must determine that the director has no direct or
indirect material relationship with Carter's. The Board considers all relevant information provided by
each director regarding any relationships each director may have with Carter's or management. As a
result of this review, our Board has determined that all of our current directors are independent and
meet the independence requirements under the listing standards of the NYSE, the rules and regulations
of the U.S. Securities and Exchange Commission (the 
SEC), and Carters Corporate Governance
Principles.
BOARD AND COMMITTEE EVALUATIONS
The Board recognizes that a robust and constructive evaluation process is an essential component of
good corporate governance and Board and committee effectiveness. Through this process, directors
provide feedback and assess Board, committee and director performance, including areas where the
Board believes it is functioning effectively and areas where the Board believes it can improve. The Board
and the committees may, from time to time, engage outside third parties to help with this process.
In fiscal 2024, under the leadership of Mr. Montgoris, the Nominating & Corporate Governance
Committee oversaw the Boards annual evaluation process, which focused on the Board as a whole and
each of the committees, as well as individual peer-to-peer assessments. These assessments were
facilitated by Carter's legal department and included individual interviews with each director with
feedback given to each director.
RETIREMENT POLICY
Our Corporate Governance Principles include a retirement policy providing that each independent
directors retirement will be automatic at the annual meeting of shareholders following such director
reaching the age of seventy-five (75), and no person shall be eligible for nomination or election as an
independent director after reaching the age of seventy-five (75), subject to the following exceptions:
(a)
In connection with Mr. Casey's retirement and Mr. Montgoris' appointment as Non-Executive
Chairman, the Board approved an amendment to its Corporate Governance Principles to extend
the retirement date for Mr. Montgoris to coincide with the annual meeting of shareholders
following his seventy-ninth (79th) birthday (in 2026) to the extent he is still serving as a director
at such time; and
14

(b)
The Board may waive this policy with respect to an individual upon the recommendation of the
Nominating & Corporate Governance Committee. A waiver may be granted on a case-by-case
basis for any reasonable purpose including, but not limited to, the particular skills and
experiences the director brings to the Board, the directors past performance and ability to
continue to constructively contribute going forward, and the then-current composition of the
Board. The affected director shall not participate in any vote regarding the waiver if he or she is
an incumbent director.
The Board determined that the above exception was appropriate in order to promote continuity of
experience on the Board in the short- term by allowing Mr. Montgoris to serve beyond his seventy-fifth
(75th) birthday if the Nominating & Corporate Governance Committee and the Board determine it is
otherwise appropriate. More broadly, the Board, as recommended by the Nominating & Corporate
Governance Committee, may use reasonable discretion to allow a director to serve past his or her
seventy-fifth
f
(75th) birthday in the future.
15
Proxy

BOARD AND ANNUAL MEETINGS
Our Corporate Governance Principles require at least four regularly scheduled Board meetings each
year, and each director is expected to attend each meeting. The Board held four regularly scheduled
quarterly meetings during fiscal 2024; and held eleven additional special meetings to discuss business
developments and the overall strategy and performance of Carter's.
In fiscal 2024, no director participated in less than 75% of the aggregate number of all the Board and
applicable committee meetings that they were eligible to attend.
Although Carter's does not have a policy regarding director attendance at annual meetings of
shareholders, all directors are encouraged to attend the Annual Meeting. All of the directors then standing
for election attended Carters virtual annual meeting of shareholders in fiscal 2024.
EXECUTIVE SESSIONS
Executive sessions of non-management directors are held at least four times a year. Any non-
management director can request that additional executive sessions be scheduled. The Non-Executive
Chairman presides at the executive sessions of non-management directors.
BOARD COMMITTEES
Our Board has the following standing committees: the Audit Committee, the Compensation & Human
Capital Committee, the Nominating & Corporate Governance Committee, and the Business
Transformation Committee (formed in September 2024). The Board may also establish other
committees to assist in the discharge of its responsibilities.
All members of each committee are independent directors. Each committee operates under a written
charter, a current copy of which is available on the Investor Relations section of our website at
ir.carters.com, or in print by contacting Mr. Robinson at Carter's address: 3438 Peachtree Road NE, Suite
1800, Atlanta, Georgia 30326. In fulfilling the oversight and other responsibilities delegated by the
Board, each Committee:
 provides the Board with regular reports of its activities;
 has the sole authority to retain or terminate its consultants and other advisors;
 receives appropriate funding to pay for necessary resources and administrative expenses; and
 annually evaluates its performance.
16

17
Oversight and Other Responsibilities
•
Accounting and
Financial Reporting.
Accounting and financial
reporting process and
review, including the
integrity of our financial
statements and internal
controls.
•
Independent auditor.
Independent auditor
engagement,
qualifications, and
independence.
•
Enterprise Risk
Management.
Enterprise risk
management programs
and coordination of risk
oversight with the Board
and other committees.
•
Cybersecurity and
Artificial Intelligence.
Oversight of our
cybersecurity program
and initiatives, as
described in greater
detail under the heading

Risk Oversight, and
oversight over artificial
intelligence programs,
policies, procedures,
and risks.
•
Internal Audit. Internal
audits function, results,
and assessment of our
risk management
process.
•
Compliance and Ethics.
Compliance and ethics
programs, monitoring,
investigations, and
remediation efforts,
including reports of
potential misconduct.
•
Tax Matters. Positions
with respect to income
and other tax
obligations.
•
Policy Oversight.
Policies and procedures
related to the
committees oversight
areas (including auditor
independence matters
and related party
transactions)
•
Safety. Oversee matters
related to safety
(including employee
and product safety).
•
Committee Report.

Report of the Audit
Committee in this
proxy statement,
describing the Audit
Committees duties and
activities.
Committee Members
TheBoard hasdetermined that all
members of the Audit Committee
satisfy theapplicable audit
committeeindependence
requirements of theNYSEand the
SEC.TheBoard has also determined
that all members of theAudit
Committee arefinancially literate,as
required under NYSE rules, and that
Ms. Schar and Messrs. Black and
Borgen qualify as
audit committee
financial experts as defined by
applicable SEC rules.
•
Ms. Schar (Chair)
•
Mr. Black
•
Mr. Borgen
•
Mr. Hipp
•
Ms. Rauch
9
Number of Meetings During
Fiscal 2024
Audit
Committee
Proxy

18
Oversight and Other Responsibilities
•
Corporate
Governance.
Corporate governance
structure and
practices, including
development and
approval ofcorporate
governance principles
and overseeing
compliance with those
principles.
•
Sustainability & ESG
Matters. Overall
approachto
sustainability and ESG
matters (including
strategy, monitoring,
and external
reporting), and
philanthropy and
community
engagement.
•
Director Succession
Planning. Director
succession planning
reviews and
identification,
screening, and
recruitment of
individuals qualified to
become Board
members.
•
Board and Committee
Composition and
Leadership.
Recommendations, in
consultationwith the
Lead Director, on
composition of the
Board and its
Committees, and
selection of
Committee Chairs and
Lead Director.
•
Political
Contributionsand
Lobbying. Reviewing
policies related to
political contributions
and lobbying.
•
Board and Committee
Evaluations and CEO
Succession. Annual
performance review of
the Board and its
Committees in
consultationwith the
Non-Executive
Chairman, and
coordination of survey
ofindependent
directors regarding
peer performance.
Committee Members
•
Mr. Montgoris (Chair)
•
Ms. Borenstein
•
Ms. Rauch
•
Ms. Stahl
5
Number of Meetings During
Fiscal 2024
Nominating &
Corporate
Governance
Committee
The Board has determined that
all members of the Nominating
& Corporate Governance
Committee satisfy the
independence requirements of
the NYSE.

19
Oversight and Other Responsibilities
•
Executive
Compensation Program.
Compensation strategy,
evaluation of
compensation plans,
selection, and relative
weightings to facilitate
and align with Companys
strategies.
•
CEO Compensation.
Goals, objectives,
elements, and value for
CEO compensation, in
consultation with
independent members of
the Board.
•
OtherLeadership Team
Compensation.
Compensation elements
and value for all other
members of our
leadership team.
•
Management
Development and
Succession Planning.
Senior management
development, evaluation,
and succession planning,
including assisting the
Board with CEO
succession planning.
•
Say on Pay: Review
compensation discussion
& analysis disclosures and
say-on-pay proposal with
management.
•
Board Compensation.
Compensation provided
to non-employee
members of the Board
•
Committee Report.

Compensation & Human
Capital Committee
Report in this proxy
statement.
•
Human Capital
Management. Matters
with respect to our
workforce, including
culture and employee
engagement, broad-
based compensation and
benefits, growth and
development, and
purpose and values.
•
Compensation Risk
Management.
Compensation and
human capital-related
risks and risks related to
our compensation
programs.
Committee Members
The Board has determined that
all members of the
Compensation & Human Capital
Committee satisfy the
applicable compensation
committee independence
requirements of the NYSE and
the SEC.
•
Mr. Eagle (Chair)
•
Mr. Anderson
•
Mr. Borgen
•
Mr. Hipp
•
Ms. Stahl
13
Number of Meetings During
Fiscal 2024
Compensation &
Human Capital
Committee
Proxy

20
Oversight and Other Responsibilities
•
Business
Transformation
Oversight. Identify
and set business
transformation
objectives and develop
strategies toachieve
those objectives
•
Strategic Plan
Development,
Opportunities, and
Risks. Oversee
development of
Carters annual
strategic plan, and
opportunities and risks
related to that plan.
•
Assess Carters
Capabilities.
Periodically assess
Carters capabilities
regarding the
development,
execution, and
implementation of
strategy.
Committee Members
•
Ms. Stahl (Chair)
•
Ms. Borenstein
•
Ms. Rauch
•
Ms. Schar
10
Number of Meetings During
Fiscal 2024
Business
Transformation
Committee
The Board has determined that
all members of the Business
Transformation Committee
satisfy the independence
requirements of the NYSE.

ELECTION NOMINATION PROCESS
Governance Principles
Our process for election of directors is based on the following core principles:

All directors are elected annually.

Majority Voting standard for election of directors  each director in an uncontested election
must receive more votes 
For his or her election than votes 
Against in order to be elected.

A director nominee who is not re-elected under our majority voting standard must tender his or
her resignation for consideration by the Board. The Nominating & Corporate Governance
Committee is then required to make a recommendation to the Board as to whether it should
accept or reje
e ct such resignation, and the Board must accept or reject
e
the offer to resign and
publicly disclose its decision within 90 days of the certification of the results of the election. In
addition, pursuant to amendments to the Company's Corporate Governance Principles and
Nominating & Corporate Governance Committee charter adopted in February 2025, the Board
expects directors to ensure that their time commitments do not interfere with their duties and
responsibilities as a director, and will consider a director candidate's time commitments when
evaluating the potential candidate.
Board Membership Criteria and Identifying Candidates
Our Corporate Governance Principles outline the following criteria for Board membership:

Our Nominating & Corporate Governance Committee shall include, in each director search,
candidates who reflect diverse backgrounds, experiences, and points of view, including diversity
of gender, race, and/or ethnicity.

On an annual basis, the Nominating & Corporate Governance Committee shall review with the
Board the appropriate skills and characteristics required of Board members in the context of the
current composition of the Board and provide an assessment of the perceived needs of the Board
at that point in time. The Nominating & Corporate Governance Committee's review may include
consideration of all relevant factors, including the experience, integrity, diversity, and reputation
of potential candidates.
Our leadership team and, occasionally, a third-party search firm, assist the Nominating & Corporate
Governance Committee to identify candidates using the general Board membership criteria and current
desired skills described in this proxy statement and Carter's Corporate Governance Principles. In addition,
the Nominating & Corporate Governance Committee considers candidates who are recommended by
shareholders, other Board members, and our leadership team against those same general Board
membership criteria and desired skills.
Any shareholder who wants to recommend a director candidate for the Nominating & Corporate
Governance Committee to consider nominating for the 2026 Annual Meeting should submit a written
request and related information to Mr. Robinson no later than December 31, 2025, in order to allow for
sufficient time to consider the recommendation. Shareholders may also nominate director candidates
directly if they comply with the procedures set forth in our amended and restated bylaws (
Bylaws),
which are described in more detail in Question 22 
How do I submit a proposal or nominate a director
candidate for the 2026 Annual Meeting? on page 83.
21
Proxy

SHAREHOLDER COMMUNICATION WITH DIRECTORS
A shareholder or other interested party may submit a written communication to the Board, the Non-
Executive Chairman, or other individual non-management directors. The submission should be delivered
to Mr. Robinson at Carter's address: 3438 Peachtree Road NE, Suite 1800, Atlanta, Georgia 30326.
The Board, the Non-Executive Chairman, or other non-management directors may require the submitting
shareholder to furnish such information as may be reasonably required or deemed necessary to
sufficiently review and consider the submission of such shareholder.
Each submission will be forwarded, without editing or alteration, to the Board, the Non-Executive
Chairman, or individual non-management directors, as appropriate, at, or prior to, the next scheduled
meeting of the Board. The Board or the Non-Executive Chairman, as appropriate, will determine, in their
sole discretion, the method by which such submission will be reviewed and considered.
RISK OVERSIGHT
Oversight of the various risks we face is integral to the Board's oversight of our business. The Board,
each of our committees, and management have specific roles and responsibilities with respect to those
risks. Carters management is responsible for identifying, assessing, managing, and mitigating Carters
strategic, financial, operational, and compliance risks. The chart below provides an overview of the
Boards and its committees risk oversight responsibilities.
The Board and its committees receive updates from senior management on relevant risks and
management efforts in these areas at Board and committee meetings at least annually and more
frequently, as appropriate.
Cybersecurity Oversight
The Audit Committee oversees risks from cybersecurity threats, including through quarterly reports to the
Audit Committee by Carters Chief Information Security Officer (
CISO) and Chief Information &
Technology Officer (
CITO) and, as needed, special reports to the Audit Committee and/or the
22
Board of Directors
•
Oversees enterprise risk management and managements overall enterprise
risk management efforts
•
Exercises direct oversight of strategicrisks of Carters and other risks not
delegated to a committee
Audit Committee
Oversees:
•
Processes, procedures, and
capabilities of enterprise risk
management program
•
Risks related to financialstatements,
financial reporting, and internal
controls
•
IT and cybersecurity risks
•
Carters compliance program,
including processes and procedures
and compliance with legal and
regulatory requirements
•
Related party transaction policy
compliance
Compensation & Human
Capital Committee
Oversees:
•
Risks from compensation policies
and practices for both executive
compensation and compensation
generally, as well as other human
capital-related risks
•
Compliance with legal and regulatory
requirements related to
compensation
•
Management development and
succession
Nominating & Corporate
Governance Committee
Oversees:
•
ESG efforts, overall ESG strategy,
goals and targets disclosed in annual
CSR report, and investments related
to ESG initiatives
•
Overall compliance with legal and
regulatory requirements specifically
related to corporate governance
matters
•
Community outreach efforts and
lobbying and other political activities

Chairperson of the Audit Committee. The Audit Committee includes members with technology and
cybersecurity experience and certifications, including an Audit Committee member with over 28 years of
experience working for Hewlett Packard Enterprise Company and an Audit Committee member with a
Computer Emergency Readiness Team (
CERT) Certificate in Cybersecurity Oversight issued by the CERT
Division of the Software Engineering Institute at Carnegie Mellon University and completion of the
National Association of Corporate Directors Master Course in Cybersecurity.
Management plays an integral role in assessing and managing the Companys material risk from
cybersecurity risks. The assessment and management of those risks is led by the Companys CISO, who
has over 20 years of experience working in information technology, including over 10 years specifically
focused on information security, infrastructure, and strategy, and the Companys CITO, who has over 30
years of experience in Retail, Consumer Products, Merchandising, and IT, of which 16 years have been in
leadership roles, and implemented by the CISOs team, who are responsible for leading enterprise-wide
cybersecurity strategy, policy, standards, architecture, processes and operations. The CISO and CITO lead
quarterly meetings of the Companys Security Executive Steering Committee (the 
Steering Committee),
which is composed of the Companys Chief Financial Officer, General Counsel, and CITO. The Steering
Committee drives awareness, ownership and alignment across broad governance and risk stakeholder
groups for effective cybersecurity risk management and reporting.
Carters management maintains and implements a written Incident Response Plan, which is reviewed and
updated on an annual basis and includes an Incident Response Plan Executive Committee consisting of
Carters CITO, CISO, and General Counsel. In addition, members of the CISOs and CITOs teams monitor
Carters systems and processes and promptly report incidents as required under the Incident Response
Plan, including, but not limited to, reporting to the appropriate members of management and, as needed,
the Audit Committee. We have been subject to cybersecurity incidents in the past, including within the
last three years, and expect them to continue as cybersecurity threats evolve in sophistication. Although
the aggregate impact of cybersecurity incidents has not been material to date, we cannot provide any
assurances that such events will not occur and impacts therefrom will not be material in the future.
The Incident Response Plan has been developed to align with the four phases for the security handling
lifecycle set forth in the National Institute for Standards and Technology Special Publication 800-61: (1)
Preparation, (2) Detection & Analysis, (3) Containment Eradication & Recovery, and (4) Post-Incident
Activity.
ESG Oversight
We believe a strong management team and governance are essential to demonstrating accountability
and driving our desired results when it comes to important ESG matters, including climate change,
product quality and safety, workers rights, product design and innovation, supply chain management,
and employee engagement. The following is a high-level overview of oversight for ESG matters at our
company.
23
Proxy

More information about our ESG efforts, including our latest sustainability report, can be found at
esg.carters.com. This website and others referenced herein are not incorporated by reference into
this proxy statement.
Compensation Program Risk Assessment
As part of its oversight role, the Compensation & Human Capital Committee considers the impact of our
compensation program, policies and practices (both at the executive and below-executive levels) on
Carters overall risk profile. Specifically, the Compensation & Human Capital Committee reviews
Carters compensation policies and practices, discusses and reviews whether the incentive
compensation arrangements promote appropriate approaches to the taking and management of risk,
and, specifically, do not encourage executive officers to take unnecessary and excessive risks. We
believe that our pay program provides an effective balance in cash and equity and a mix of short- and
longer-term performance periods and also requires the Compensation & Human Capital Committee to
approve payouts. Based on the Compensation & Human Capital Committees most recent review, the
Compensation & Human Capital Committee determined that the risks arising from Carters
compensation policies and practices are not reasonably likely to have a material adverse effect on
24
Board of Directors
Nominating and Corporate Governance Committee
Oversees the Companys ESG initiatives through
quarterly reviews of climate plans and other keyissues
CEO
Reviews and approves ESG goals, plans, and progress
SVP, General Counsel, Secretary, Corporate Social Responsibility, and
Chief Compliance Officer
Leads ESG, inclusion, and compliance initiatives
ESG
Council
Formulates and oversees
ESG goal-setting and key
initiatives through cross-
functional collaboration
Diversity & Inclusion
Steering Committee
Provides business insights
and initiatives that support
our diversity& inclusion
strategy
Compliance
Committee
Enables Carters to operate
ethically and in accordance
with applicable laws, rules,
and regulations
Corporate Social Responsibility Department
Manages and implements ESG strategies and programs

Carters.
CORPORATE GOVERNANCE PRINCIPLES AND CODE OF ETHICS
Carter's is committed to conducting its business with the highest level of integrity and maintaining the
highest standards of corporate governance. Our Corporate Governance Principles and Code of Ethics
provide the structure within which our Board and management operate Carters. Our Code of Ethics
applies to all directors and Carters employees. Our Corporate Governance Principles and Code of Ethics
are available in the Investor Relations section of our website at ir.carters.com or in print by contacting
Mr. Robinson at Carters address set forth in the 2025 Notice of Annual Meeting.
25
Proxy

PROPOSAL NUMBER ONE  ELECTION OF DIRECTORS
The Board proposes that the following 11 director nominees be elected to the Board to serve until the
next annual meeting in 2026, or until his or her earlier resignation, death, or removal. Each nominee is
listed below, along with their age as of the date of the Annual Meeting. For more information about each
of the director nominees, including individual biographies. Please see 
Board of Directors and Corporate
Governance Information2025 Nominees for Director.
Name
Age
Rochester Anderson, Jr.
63
Jeffrey H. Black
70
Hali Borenstein
40
Luis Borgen
55
Jevin S. Eagle
58
Mark P. Hipp
63
William J. Montgoris
78
Douglas C. Palladini
58
Stacey S. Rauch
67
Gretchen W. Schar
70
Stephanie P. Stahl
58
The Board recommends a vote FOR the election of each of the director nominees listed
above.
VOTE REQUIRED
Pursuant to our Bylaws and our Corporate Governance Principles, the number of votes properly cast

for a director nominee must exceed the aggregate number of votes cast 
against that nominee for
that nominee to be elected. Abstentions and broker non-votes will be counted towards a quorum.
Abstentions and broker non-votes will not have any impact on the outcome of this vote.
Any nominee who is an existing director who does not receive a majority of votes cast 
for their
election is required to tender his or her resignation for consideration by the Board. The Nominating
and Corporate Governance Committee is then required to make a recommendation to the Board as to
whether it should accept or reject such resignation. The Board, taking into account such
recommendation, will decide whether to accept such resignation. The Boards decision will be publicly
disclosed within ninety (90) days after the results of the election are certified. A director whose
resignation is under consideration shall abstain from participating in any recommendation or decision
regarding his or her resignation. If the resignation is not accepted, the director will continue to serve
until the next annual meeting of shareholders and until such directors successor is elected and
qualified.
26

COMPENSATION OF DIRECTORS
When they are initially appointed to the Board, each of our non-management directors receives a one-
time restricted stock grant, equal to the value of the annual retainer, that cliff vests after three years.
Thereafte
f
r, each of our non-management directors receives an annual cash retainer and an annual
stock award, and each of our committee chairpersons and our Non-Executive Chairman receives an
additional annual retainer. Non-management directors also receive fees for each meeting they attend.
For fiscal 2024, each directors annual retainer was comprised of a cash payment of $90,000
(increased from $85,000 in 2023) and an immediately vested grant of our common stock valued at
approximately $160,000. In addition to the annual retainer:
 our Non-Executive Chairman received a $50,000 cash retainer (an increase from $40,000 in 2023) for
his service as Lead Independent Director;
 the chairpersons of our Audit Committee and our Business Transformation Committee
received a $30,000 cash retainer and the chairpersons of our Compensation & Human Capital
and Nominating & Corporate Governance Committees each received $25,000 cash retainers;
and
 each director received meeting fees of $2,500 for each regularly scheduled Board meeting, and
$1,000 for each special meeting of the Board and regularly scheduled or special meeting of the
standing Board committees.
In connection with Mr. Casey's retirement from the Board and the appointment of Mr. Montgoris as Non-
Executive Chairman in January 2025, Mr. Montgoris' annual cash retainer for service as Non-Executive
Chairman was increased to $150,000 and Mr. Montgoris received an additional fee of $36,667 for his
service as Non-Executive Chairman through the 2025 annual meeting.
We also reimburse directors for travel expenses incurred in connection with attending Board and
committee meetings and for other expenses incurred while conducting Company business.
Mr. Casey received no additional compensation for serving on the Board.
The following table provides information concerning the compensation of our non-management directors
serving during fiscal 2024.
27
Proxy

FISCAL 2024 DIRECTOR COMPENSATION TABLE(a)
Name
Fees Earned
or Paid in
Cash
($)
(b)
Stock
Awards
($)
(c)
Total ($)
Rochester Anderson, Jr.
$122,000
$160,006
$282,006
Jeffrey H. Black
$119,000
$160,00
$
6
279,006
Hali Borenstein
$123,000
$160,006
$283,006
Luis Borgen
$132,000
$160,006
$292,006
Jevin S. Eagle
$148,000
$160,006
$308,006
Mark P. Hipp
$133,000
$160,006
$293,006
William J. Montgoris
$191,000
$160,006
$351,006
Stacey S. Rauch
$135,000
$160,006
$295,006
Gretchen W. Schar
$158,000
$160,006
$318,006
Stephanie P. Stahl
$167,000
$160,006
$327,006
)
As a NEO and former management director, Mr. Caseys compensation information is omitted from this table and presented in the
Summary Compensation Table on page 53.
(b)
This column reports the amount of cash compensation earned in fiscal 2024 through annual cash retainers and meeting fees.
(c)
On May 16, 2024, we issued 2,293 fully vested shares of common stock to each non-management director who was a member of the
Board on that date with a grant date fair value of $69.78 per share, computed in accordance with FASB ASC Topic 718.
For complete beneficial ownership information of our common stock for each director, see the
information presented below the heading 
Securities Ownership of Beneficial Owners, Directors, and
Executive Officers on page 70.
In November 2020, the Board approved a deferred compensation program for non-management
directors, under which, beginning in 2021, directors may opt to defer cash retainer payments and
stock grants in the form of deferred stock units until the fifth anniversary of the grant date or until the
director leaves the Board. No directors deferred their cash retainer and/or stock grants for fiscal 2024.
Under Carters minimum ownership guidelines, no director may sell Carter's stock unless he or she owns
shares of Carter's stock with a total market value in excess of five times his or her annual cash retainer,
or $450,000, by the end of his or her sixth year of service on the Board. Each of our directors complied
with these ownership guidelines in fiscal 2024.
There are no family relationships among any of the directors or our executive officers and none of our
non-management directors performed any services for Carter's other than services as directors.
28

EXECUTIVE OFFICERS BIOGRAPHICAL INFORMATION AND
EXPERIENCE
DOUGLAS C. PALLADINI
Chief Executive Officer &
President, Direc
r
tor
Age: 58
Douglas C. Palladini
d
joined Carters on April 3, 2025 as Chief
Executive Officer & President and a member of the Board. Mr.
Palladini served as the founder and owner of Kickstand, LLC, a
consulting and advisory business focused on brand and consumer
strategy, from April 2022 until March 2025. Prior to founding
Kickstand, LLC, from June 2004 to March 2022, Mr. Palladini
served in various roles of increasing responsibility at Vans, a
subsidiary of V.F. Corporation, culminating in his role as Global
Brand President of Vans from July 2016 through March 2022.
RICHARD F. WESTENBERGER
Senior Executive Vic
V e President,t
Chief Financial Officer &
Chief Operating Officer, form
r er
Interim Chief Executive Officer
Age: 56
Richard F. Westenberger joined Carters in 2009 as Executive Vice
President & Chief Financial Officer, and was appointed Senior
Executive Vice President, Chief Financial Officer & Chief Operating
Officer in March 2024, and also served as Interim Chief Executive
Officer from January 2025 to April 2025. Mr. Westenbergers
responsibilities in his role as Senior Executive Vice President,
Chief Financial Officer & Chief Operating Officer include
management of Carters finance, enterprise risk management,
supply chain, and real estate functions. Prior to joining Carters,
Mr. Westenberger served as Vice President of Corporate Finance
and Treasurer of Hewitt Associates, Inc. from 2006 to 2008. From
1996 to 2006, Mr. Westenberger held various senior financial
management positions at Sears Holdings Corporation and its
predecessor organization, Sears, Roebuck and Co. (collectively,

Sears), including Senior Vice President & Chief Financial Officer
of Lands End, Inc., Vice President of Corporate Planning &
Analysis, and Vice President of Investor Relations. Prior to Sears,
Mr. Westenberger was with Kraft Foods, Inc. He began his career
at Price Waterhouse LLP, a predecessor firm to
PricewaterhouseCoopers LLP, and is a certified public
accountant.
29
Proxy

KENDRA D. KRUGMAN
Senior Executive Vic
V e President,
Chief Creative & Growth Offic
f er
Age: 47
Kendra D
r
. Krug
K
man joined Carter's in 2007 as Manager,
Merchandising. Ms. Krugman was named Director, Merchandising
in 2008, Vice President Sales and Merchandising, Mass Channel in
2012, Senior Vice President Carters Brands and Licensing in 2016,
Executive Vice President, Merchandising & Design in July 2018,
Executive Vice President, Retail and Chief Merchandising Officer in
March 2023, and Senior Executive Vice President, Chief Creative &
Growth Officer in March 2024. Prior to joining Carter's, Ms.
Krugman held positions at The Gap, Inc. and French Connection
Group.
JULIE A. D'EMILIO
Executive Vice President,
Global Sales
Age: 58
Julie A. D
Emilio joined Carters in 2006 as Vice President of
Sales. Ms. DEmilio was named Senior Vice President of Sales in
2013, and then Executive Vice President, Sales in 2016. In 2020,
Ms. DEmilio was appointed Executive Vice President, Global
Sales. Prior to joining Carter's, Ms. DEmilio was with Calvin
Klein Jeans, a division of The Warnaco Group, Inc., in various
management positions, including Executive Vice President of
Juniors and Girls, and Vice President of the Womens Division.
Ms. DEmilio began her career with Liz Claiborne Inc. and also
worked for London Fog Industries, Inc. and Jones Apparel
Group, a predecessor of The Jones Group, Inc.
30

JEFFREY M. JENKINS
Executive Vice President,
Global Marke
r
ting
Age: 47
Jeffrey M. Jenkin
k
s joined Carters in 2019 as Executive Vice
President, Global Marketing. From July 2017 to July 2019, Mr.
Jenkins was with CKE Restaurants Holdings, Inc., the parent
company of the Carls Jr. and Hardees fast food restaurant
brands, serving most recently as Global Chief Digital Officer and
previously as Chief Marketing Officer. From June 2015 to July
2017, Mr. Jenkins was with Whole Foods Market, Inc. as Vice
President, Digital Marketing & Channel Activation and Vice
President, Digital Strategy & Marketing. From 2008 to June 2015,
Mr. Jenkins was with Yum! Brands, Inc. in marketing roles of
increasing responsibility.
ALLISON PETERSON
Executive Vice Pres
r
ident,
Chief Retail & Digital Officer
Age: 50
Allison Peterson joined Carters in July 2024 as Executive Vice
President, Chief Retail & Digital Officer. From 2004 to 2023, Ms.
Peterson was with Best Buy Co., Inc. (
Best Buy), serving most
recently as Executive Vice President, Chief Customer Officer with
responsibilities for strategy, customer experience and insights,
marketing, and loyalty. Her previous management positions at Best
Buy included Senior Vice President, Chief Customer & Marketing
Officer, President, E-Commerce, and Vice President, Category
Marketing, Brand Strategy & Planning. Prior to Best Buy, Ms.
Peterson worked for Target Corporation in merchandising and
planning roles of increasing responsibility.
31
Proxy

ANTONIO D. ROBINSON
Senior Vice President,
General Counsel, Secretary,
Corporate Social Responsibility &
t
Chief Compliance Officer
Age: 53
Antonio D. Robins
i
on joined Carters in 2010 as Vice President,
Associate General Counsel. Mr. Robinson was named Vice
President, Deputy General Counsel & Chief Compliance Officer in
2019; Senior Vice President, Corporate Social Responsibility in
2020; and Senior Vice President, General Counsel, Secretary,
Corporate Social Responsibility & Chief Compliance Officer in 2023.
Prior to joining Carters, Mr. Robinson was a shareholder and
attorney in private practice in the Atlanta office of Littler
Mendelson P.C.
RAGHU R. SAGI
Executive Vice President,t
Chief Inform
f
ation & Techn
T
ology
g
Officer
Age: 54
Raghu R. Sagi joined Carters in April 2024 as Executive Vice
President, Chief Information & Technology Officer. From 2019 to
2024, Mr. Sagi served as the Chief Information Officer of Inspire
Brands, Inc. From 2011 to 2019, Mr. Sagi served in various roles at
Sephora USA, Inc., including Senior Vice President and Chief
Engineering Officer responsible for the technology platforms
supporting retail stores, eCommerce, and marketing.
32

KAREN G. SMITH
Executive Vice President,
Supply Chain
Age: 58
Karen G. Smith
t joined Carters in 2022 as Executive Vice President,
Supply Chain. From 2019 to 2022, Ms. Smith was with Kontoor
Brands, inc. (
Kontoor), serving most recently as Executive Vice
President of Supply Chain and previously as Vice President of
Global Supply Chain Operations, a role she assumed afte
f
r
Kontoors 2019 spinoff from V.F. Corporation. From 2014 to 2019,
she was with V.F. Corporation in various management positions,
including Vice President, Supply Chain Operations, Americas East.
Prior to V.F. Corporation, Ms. Smith worked for Jockey
International in supply chain leadership roles of increasing
responsibility.
JILL A. WILSON
Senior Vic
V e President,
Human Resources
r
&
Talent Development
Age: 58
Jill A. Wilson joined Carters in 2009 as Vice President of Human
Resources. In 2010, Ms. Wilson was promoted to Senior Vice
President, Human Resources & Talent Development. Ms. Wilson
joined Carter's after more than 20 years with The May Company
and Macys, Inc. ("Macy's"). While at Macys, Ms. Wilson held
various human resource positions of increasing responsibility,
including Group Vice President of Human Resources. Ms. Wilson
has extensive experience in a broad range of human resource
disciplines including global talent management, organizational
development, learning and development, compensation,
benefits, talent acquisition, and merger integration.
33
Proxy

COMPENSATION DISCUSSION AND ANALYSIS
OVERVIEW
This Compensation Discussion and Analysis, or CD&A, is intended to provide information regarding
Carters executive compensation program and practices. This CD&A covers a variety of topics, including
Carters compensation philosophy regarding executive compensation, the role of our Compensation &
Human Capital Committee (also referred to in this CD&A as the Committee), in setting the compensation
of our executive officers, including our Named Executive Officers (
NEOs), and our executive
compensation decisions for fiscal 2024.
Our NEOs (with their titles as of the filing of this proxy statement) for fiscal 2024 were:
NEO
Position
Richard F. Westenberger1
Senior Executive Vice President,
Chief Financial Officer & Chief Operating Officer, and former
Interim Chief Executive Officer
Kendra D. Krugman
Senior Executive Vice President,
Chief Creative & Growth Officer
Allison M. Peterson2
Executive Vice President, Chief Retail & Digital Officer
Raghu R. Sagi3
Executive Vice President,
Chief Information & Technology Officer
Michael D. Casey4
Former Chairman, Chief Executive Officer & President
Brian J. Lynch5
Former President & Chief Operating Officer
1 Mr. Westenberger served as Interim Chief Executive Officer from January 2025 until the appointment of Douglas C. Palladini as
Chief Executive Officer and President on April 3, 2025.
2 Ms. Peterson joined Carters in July 2024.
3 Mr. Sagi joined Carter's in April 2024.
4Mr. Casey retired as an officer and director of Carters in January 2025, and after serving in an advisory capacity from January
2025 through February 28, 2025, retired from Carters.
5 Mr. Lynch retired from Carters in February 2024.
OVERVIEW OF EXECUTIVE COMPENSATION PROCESS FOR FISCAL 2024
This CD&A presents information regarding the Committees consideration of Carters performance in
2024 and related compensation decisions.
Consistent with previous years, the Committee approved Carters compensation programs and final
target metrics in the first quarter of 2024, based on forecasted financial results for the fiscal year. The
Committee considered various factors in determining the design of Carters compensation programs for
2024, including the cumulative effect of high levels of inflation and elevated interest rates on our target
consumers, and initiatives intended to reduce inventory levels, improve product sell-throughs, gross
profit margin, and on-time shipping performance as well as lower ocean freight rates and product costs.
This process considered our performance during 2024, as highlighted below, and this CD&A describes
the Committees compensation decisions and determination of the the level of achievement of 2024
performance metrics.
34

2024 CARTERS PERFORMANCE HIGHLIGHTS
The following provides key performance highlights for 2024, which reflect the challenging macroeconomic
environment for our business. Unless otherwise stated, comparisons are to fiscal 2023 and include both
GAAP financial measures and adjusted, non-GAAP financial measurements. We believe the non-GAAP
adjustments provide a meaningful comparison of the Companys results and afford investors a view of
what management considers to be the Companys underlying performance. These measures are
presented for informational pay-related purposes only. See the Appendix to this Proxy Statement for
additional disclosures and reconciliations regarding these non-GAAP financial measures.
35
1Non-GAAP measure; see reconciliation to GAAP in Supplemental Information.
(3%)
vs.
2023
(13%)
vs.
2023
(6%)
vs.
2023
Net Sales
Adjusted Diluted EPS1
Adjusted Operating Income1
(Adjusted Operating Margin)
$ in millions, except EPS
$2,946
$2,844
2023
2024
$328
$287
2023
2024
$6.19
$5.81
2023
2024
11.1%
of Net
Sales
10.1%
of Net
Sales
Proxy

36
$ in millions
1Sum of current and non-current operating lease liabilities. 2 Non-GAAP measure.
Balance Sheet (Year End)
2024
2023
Cash
$413
$351
Accounts receivable, net
195
184
Inventory, net
502
537
Accounts payable
248
242
Long-term debt, net
498
497
Operating lease liabilities1
632
584
Cash Flow & Return of Capital (Fiscal Year)
2024
2023
Operating cash flow
$299
$529
Capital expenditures
(56)
(60)
Free cash flow2
$243
$469
Dividends
$116
$112
Share repurchases
51
100
Total
$167
$212
• Inventories down 6% vs. LY
―
Fewer days of supply
―
Lower product costs
• Total liquidity $1.3 billion
―
$413 million cash
―
$845 million borrowing capacity on
revolving credit facility
• No seasonal borrowings in 2024
• 2023 operating cash flow reflected
sell through of pack & hold inventory
last year
• $167 million distributed to
shareholders in 2024 through
dividends and share repurchases
―
Dividends: $116 million
―
Share repurchases: $51 million

EXECUTIVE COMPENSATION HIGHLIGHTS FOR FISCAL 2024
The Committee believes that our executive compensation program is appropriately designed to attract
and retain superior executive talent and drive performance.
Reflective of this belief, approximately 98% of the votes cast at our 2024 Annual Meeting of shareholders,
were in favor of the advisory vote to approve executive compensation (
say-on-pay). While this vote was
non-binding, the Committee carefully considered the result of the say-on-pay vote in the context of our
overall compensation philosophy, policies, and related decisions. After reflecting on the say-on-pay vote,
the Committee decided that no changes to Carter's compensation philosophy were necessary. At the 2025
Annual Meeting, we will have an annual advisory vote to approve executive compensation (Proposal
Number Two). The Committee plans to continue to consider the results from this years vote and future
advisory votes on executive compensation.
We believe our pay for performance compensation philosophy is demonstrated by the alignment of
shareholder experience and the payouts actually received by our NEOs. The annual incentive
compensation paid out in 2024 was only 5% of the target given that net sales and operating income
thresholds were not attained and the strategic objectives (weighted at 20%) were attained at 25%.
Additionally, none of the performance shares granted in 2022 eligible for vesting in 2024 were earned
because performance thresholds were not attained.
As described more fully in this CD&A, the Committee took the following actions, among others, with
respect to fiscal 2024 compensation for our NEOs:
 reviewed the peer group to be used by the Committee as a source of comparative compensation
data for fiscal 2024, and determined that the existing group remained appropriate with no
necessary adjustments;
 benchmarked compensation for all executive officers, including the NEOs, using a combination of
proxy disclosures by Carter's peer group and retail industry survey data;
◦
structured annual incentive compensation for 2024 to consist of three performance metrics,
weighted as follows: (1) net sales (50%); (2) operating income (with attainment to be
measured based on adjusted results as reported to shareholders) (30%); and (3) strategic
objectives (20%), consisting of the following: (a) improve the consumer perception of Carter's
brand style and value; (b) improve U.S. Retail traffic through improved marketing
effectiveness and new capabilities; and (c) demonstrate continued progress with multicultural
customer acquisition;
 approved new equity awards consisting of 50% time-based restricted stock vesting annually over
four years and 50% performance-based restricted stock. The 2024 performance-based restricted
stock awards have the following features:

three performance metrics, net sales, adjusted earnings per share (as reported to
shareholders), and relative total shareholder return; and

a three-year performance period (fiscal years 2024, 2025, and 2026).

The Committee set target net sales and adjusted earnings per share for 2024, as well as the
target growth percentages for 2025 and 2026 that are based on actual net sales and adjusted
earnings per share for 2024 and 2025, respectively.
37
Proxy


In the first quarter of 2027, the Committee will determine the number of shares, if any, of
performance-based stock that are earned under the 2024 performance-based restricted
stock awards.
COMPENSATION GOVERNANCE
The Committee and the Board have established executive compensation-related policies and
procedures, including those discussed below, that they believe are appropriate for Carter's and its
shareholders in light of the sector in which Carter's operates, its business model, and its financial and
operational performance.
What We Do:
What We Do Not Do

Pay with Carters Performance: A significant
portion of our NEOs total direct compensation is linked to
Carter's performance in the form of annual incentive
compensation and long-term equity compensation tied to
performance criteria.

Retain an Independent Compensation Consultant: The
Committee retains an independent consultant to advise it on
executive and director compensation matters and to help
analyze comparative compensation data to confirm that the
design and pay levels of our compensation program are
consistent with market practices.

Utilize Stock Ownership Guidelines: We have minimum
stock ownership guidelines for our executive officers to
encourage them to maintain a meaningful equity interest in
Carter's in order to align their interests with those of our
shareholders.

Utilize Equity Retention Guidelines: Our equity retention
policy for executive officers requires holding periods for
time-based restricted stock and time-based stock option
grants.

Have Double-Trigger Cash Severance Arrangements in
the Event of a Change of Control: In the event of a change
of control, our severance agreements with our NEOs provide
for cash severance benefits to be paid only if there is a
qualifying termination within a set period of time following
the change of control.

Effe
f
ctive With Equity Grants in 2024, Our Equity
Incentive Arrangements Included Double-Trigger
Provisions and Mandatory Clawback Provisions: As
disclosed further in this CD&A, effective February 15, 2024,
Carter's amended its Equity Incentive Plan to include
double-trigger change of control provisions, as well as
mandatory clawback provisions consistent with the
requirements of Rule 10D-1 under the Securities Exchange
Act of 1934, as amended (the 
Exchange Act), related NYSE
listing standards, and our Clawback policy.


No Guaranteed Annual Salary
Increases or Guaranteed
Bonuses


No Re-Pricing of Stock Options


No Hedging, Pledging, or Short
Sales of Company Stock


No Special Perquisites
Provided to Our NEOs


No Equity Grants Below 100%
Fair Market Value


No Annual Equity Grants or
Trading During Closed Insider
Trading Windows
38

COMPENSATION STRUCTURE AND DETERMINATION
Our compensation philosophy is to set our NEOs total direct compensation at levels that will attract,
motivate, and retain superior executive talent in a highly competitive environment. Carters
compensation program for our NEOs is designed to support these objectives and encourage strong
financial performance on an annual and long-term basis by linking a significant portion of our NEOs
total direct compensation to Company performance in the form of annual cash incentive compensation
and long-term performance-based restricted stock awards.
The principal components of the compensation structure for our NEOs are:
 base salary;
 annual cash incentive compensation; and
 long-term equity incentive compensation.
Together, we refer to these three components as 
total direct compensation.
GENERAL
In setting a total direct compensation target for each NEO, the Committee considers both objective and
subjective factors set forth below. The Committee also reviews total direct compensation, and its
individual components, at the 25th, 50th, and 75th percentile levels paid to executives in similar positions
at the companies in our peer group and, as needed, a broader retail survey, in order to assess where the
compensation it sets falls relative to market practices.
These levels are selected because the Committee reviews this peer data as a reference point in
determining whether the total compensation opportunity is likely to provide sufficient motivation and
retention as well as whether it properly reflects the NEOs role and scope of responsibilities.
In setting compensation of Carter's NEOs, the Committee considered multiple objective and subjective
factors, including:
 the nature and scope of each executive officers responsibilities;
 comparative compensation data for executive officers in similar positions at companies in our
peer group and, as needed, a broader retail survey;
 each executive officers experience, performance, and contribution to Carter's;
 Carters performance;
 prior equity awards and potential future earnings from equity awards;
 retention needs; and
 any other factors the Committee deems relevant.
BASE SALARY
When setting base salaries for our NEOs, the Committee considers the objective and subjective factors set
forth above and also reviews base salaries at the 25th, 50th, and 75th percentile levels paid to executives
in similar positions at the companies in our peer group and a broader retail survey, as appropriate.
39
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ANNUAL CASH INCENTIVE COMPENSATION
Carters makes annual cash incentive compensation (through the Carter's, Inc. Amended and Restated
Annual Incentive Compensation Plan, the 
Incentive Compensation Plan) a significant component of
our NEOs targeted total direct compensation in order to motivate our executive officers to meet and
exceed Carters annual operating plans. For each NEO, the Committee approves target annual cash
incentive compensation as a percentage of such NEOs base salary. In establishing these annual cash
incentive compensation targets, the Committee considers our NEOs potential total direct
compensation in light of Carters compensation philosophy and comparative compensation data.
The Committee has the discretion to reduce or not to award annual cash incentive compensation,
even if Carters achieves its financial performance targets, and to take into account personal
performance in determining the percentage of each NEOs annual cash incentive compensation to be
paid, if any. Furthermore, the Board has adopted a clawback policy, consistent with the requirements
of Rule 10D-1 under the Exchange Act and the related NYSE listing standards (referred to in this proxy
statement as the 
clawback policy), that requires an executive officer (as defined in the clawback
policy) to repay or return erroneously awarded compensation in the event of an accounting
restatement of previously-reported financial results.
LONG-TERM EQUITY INCENTIVE COMPENSATION
The Carters, Inc. Amended and Restated Equity Incentive Plan (the 
Equity Incentive Plan) allows for
various types of equity awards, including stock options, restricted stock (both time and performance-
based), restricted stock units (structured as deferred restricted stock), stock appreciation rights, and
deferred stock. Awards under our Equity Incentive Plan are granted to recruit, motivate, and retain
employees and in connection with promotions or increased responsibility. Historically, the Committee
has awarded a combination of time and performance-based restricted stock and time-based restricted
stock units (structured as deferred restricted stock), although it may choose to use other forms of equity
awards in the future.
All awards under our Equity Incentive Plan must be approved by the Committee. The Committee
determines the type, timing, and amount of equity awards granted to each of our NEOs after
considering their previous equity awards, base salary, and target annual cash incentive compensation
in light of Carters compensation philosophy. The Committee also considers the comparative
compensation data in our peer group and, as needed, a broader retail survey, and our desire to retain
and motivate our NEOs and to align their goals with the long-term goals of our shareholders.
The Committees practice is to approve equity grants at regularly scheduled meetings, but may also
make equity grants at special meetings or by unanimous written consent, and could select a date
subsequent to a regularly scheduled meeting on which to grant equity awards. The Committee does not
take into account material non-public information when determining the timing or terms of equity
awards, nor does Carter's time disclosure of material non-public information for the purpose of
affecting the value of executive compensation. During fiscal 2024, the Company did not grant stock
options (or similar awards) to any executive officer during any period beginning four business days
before and ending one business day after the filing of any periodic report on Form 10-Q or Form 10-K, or
the filing or furnishing of any current report on Form 8-K that disclosed material non-public information.
More broadly, the Company has not awarded stock options (or similar awards) since fiscal 2018.
In considering the value of equity awards, we calculate the value of time-based and performance-based
restricted stock awards using the closing price of our common stock on the date of grant.
40

Effective February 15, 2024, Carter's amended its Equity Incentive Plan to include double-trigger change
of control provisions to more closely-align Carter's pay practices with market practice. Effective with
equity award grants in fiscal 2024, the vesting of the awards will be accelerated if either (1) the surviving
entity does not provide replacement awards that meet criteria as set forth in the amended Equity Plan or,
if applicable, the award agreement (referred to as 
qualifying replacement awards), or (2) the surviving
entity provides qualifying replacement awards, but there is a termination of employment for cause or
resignation for good reason (as defined in the amended Equity Incentive Plan) within two years after the
change in control.
In addition, the Equity Incentive Plan was amended to include mandatory clawback provisions consistent
with the requirements of Rule 10D-1 under the Exchange Act, related NYSE listing standards, and Carters
clawback policy. Under the amended Equity Incentive Plan, and consistent with Carters clawback policy,
the executive is required to repay or return erroneously awarded compensation in the event of an
accounting restatement of previously-reported financial results. No other changes were made to the
Equity Incentive Plan, including to the maximum number of shares that may be delivered under the Equity
Incentive Plan.
ROLE OF THE COMPENSATION AND HUMAN CAPITAL COMMITTEE, INDEPENDENT
CONSULTANT, AND MANAGEMENT
The Committee sets the total direct compensation of our NEOs, as well as the financial performance
targets for our NEOs annual cash incentive compensation and vesting terms for their equity awards,
including performance-based awards.
For fiscal 2024, the Committee engaged Meridian Compensation Partners, LLC, an independent
compensation consultant (
Meridian), to advise it on executive and director compensation matters.
Meridian informs the Committee on market trends, as well as regulatory issues and developments and
how they may impact Carters executive compensation program. Among other things, Meridian also:
 participates in the design of the executive compensation program to help the Committee
evaluate the linkage between pay and performance;
 reviews market data and advises the Committee regarding the compensation of Carters executive
officers; and
 reviews and advises the Committee regarding director compensation.
Meridian serves at the discretion of the Committee and regularly attends executive sessions with the
Committee at which management is not present. At the direction of the Committee, our Chief Executive
Officer works with Meridian to review comparative compensation data and makes recommendations for
base salary, annual cash incentive compensation, and long-term equity incentive compensation for our
NEOs, other than himself. Compensation for our Chief Executive Officer is set by the Committee, without
any involvement by the Chief Executive Officer and reflecting feedback provided by Meridian to the
Committee.
The Committee has assessed the independence of Meridian pursuant to applicable NYSE and SEC
rules and has determined that it is independent, and the work provided by it did not raise a conflict of
interest.
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PEER GROUP ANALYSIS AND RETAIL SURVEY
To assess the market competitiveness of our NEOs compensation, the Committee and management
review data provided by Meridian from two sources: our peer group and, as needed, a broader retail
survey.
The Committee has established a peer group, which is generally comprised of companies in the retail
or wholesale sectors which primarily conduct business in apparel or related accessories, sell products
under multiple brands through retail stores and online, and have net sales generally between one-half
and two times Carter's net sales.
In setting fiscal 2024 compensation, our peer group was comprised of the following fifteen companies:
Abercrombie & Fitch Co.
Kontoor Brands, Inc.
American Eagle Outfitters, Inc.
Levi Strauss & Co.
The Children's Place, Inc.
Oxford Industries, Inc.
Columbia Sportswear Company
Tapestry, Inc.
G-III Apparel Group, Ltd.
Under Armour, Inc.
Gildan Activewear, Inc.
Urban Outfitters, Inc.
Guess?, Inc.
Victoria's Secret & Co.
HanesBrands Inc.
The Committee, with the advice of Meridian, also uses select information from a broader retail survey
(that includes apparel and related products retailers or department stores which primarily sell apparel
and related products) for executive compensation market assessment in order to supplement
compensation data provided by the peer group analysis that may not be adequately represented in the
data that is available from our peer group.
2024 TOTAL DIRECT COMPENSATION
During fiscal 2024, the Committee reviewed compensation data from our peer group and, as needed, a
broader retail survey, and compared that data to the compensation of our NEOs, in connection with
approving total direct compensation for 2024. In setting total direct compensation for 2024, the
Committee also considered the various factors noted earlier in this CD&A.
The components of total direct compensation are discussed more fully below.
2024 BASE SALARY
In February 2024, the Committee approved an increase in the base salaries for each of our NEOs employed
with the Company at the time, with such increases effective in May 2024. These increases were based on
market data, the nature and scope of each NEOs responsibilities, and each NEOs performance during
fiscal 2023 (as applicable). The base salary for each NEO for fiscal 2024 is set forth below.
42

Richard
F.
Westenberger
Kendra
D.
Krugman
Allison
M.
Peterson1
Raghu
R.
Sagi2
Michael
D.
Casey
Brian
J.
Lynch3
Base salary rate2023
(effective May 2023 for all
officers except for Ms.
Krugman, and effective March
2023 for Ms. Krugman)
$715,000
$700,000
$
$
$1,300,000
$880,000
Base salary rate2024
(effective May 2024 for all
officers except for Ms.
Peterson and Mr. Sagi,
effective July 2024 for Ms.
Peterson, and effective April
2024 for Mr. Sagi)
$775,000
$775,000
$750,000
$600,000
$1,340,00
$
0

Percentage Increase
8.39%
10.71%
%
%
3.08%
%
Ms. Peterson joined Carter's in July 2024.
2Mr. Sagi joined Carter's in April 2024.
3Mr. Lynch retired from Carter's in February 2024. Mr. Lynch's base salary remained the 2023 base salary rate until his retirement
from Carter's in February 2024.
The total salary earned by each NEO in fiscal 2024 is shown in the Summary Compensation Table in the

Salary column and takes into account the change in each NEOs salary as noted above.
2024 ANNUAL CASH INCENTIVE COMPENSATION
In February 2024, the Committee set the following fiscal 2024 annual cash incentive compensation
targets for our NEOs:

150% of base salary for Mr. Casey; and

85% of base salary for Mr. Westenberger and Ms. Krugman
based on each NEOs responsibilities, expected contribution and market data.
No fiscal 2024 annual cash incentive compensation target was set for Mr. Lynch, as he retired from
Carter's in February 2024.
Upon each of Ms. Peterson and Mr. Sagi joining Carter's in July 2024 and April 2024, respectively, the
Committee set the fiscal 2024 annual cash incentive compensation target as 75% of each of their
respective base salaries.
In light of continued consumer trends and shifting customer demographics, management recommended,
and the Committee approved, a 2024 annual cash incentive compensation structure that included two
financial performance metrics and a strategic objectives component that included consumer-related
objectives, as well as two financial performance metrics, as follows:

net sales (weighted at 50%);

operating income (weighted at 30%) (with attainment to be based on adjusted results as reported to
shareholders); and

strategic objectives (weighted at 20%), which consisted of the following objectives (1) improve
consumer perception of Carter's brand style and value; (2) improve U.S. retail traffic through
43
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improved marketing effectiveness and new capabilities; and (3) demonstrate continued progress
with multicultural consumer acquisition.
The Committee selected net sales, operating income (as it may be adjusted and reported to
shareholders), and strategic objectives as performance metrics because it believes these metrics are key
measures that align with the interests of our shareholders, namely growth, profitability, and strategic
objectives related to shifting consumer demographics and continued consumer trends. As described
below, our NEOs could have earned from 0% to 200% of their target annual cash incentive compensation
in fiscal 2024 based upon Carters achievement of net sales and operating income (as it may be adjusted)
financial performance metrics and the strategic objectives metric.
The payment grid for the 2024 annual incentive compensation program is set forth below.
2024 ANNUAL CASH INCENTIVE COMPENSATION  PERFORMANCE METRICS
Net Sales
(50%)
(in millions)
Adj. Operating
Income (30%)
(in millions)1
Strategic Objectives
(20%)
25% of Target (Threshold Performance)
$
2,890
$
310
N/A
100% of Target (Target Performance)
$
3,000
$
345
N/A
200% of Target (Maximum
Performance)
$
3,093
$
377
N/A
Fiscal 2024 Performance
$
2,844
$
287.0
N/A
1See the Appendix to this Proxy Statement for a reconciliation of Adjusted Operating Income to its most directly comparable
GAAP measure, Operating Income.
In January 2025, the Committee determined that based on Carter's performance noted above, as well as
the achievement of 25% of the strategic objectives, Carter's achieved an overall performance at 5% of
Target, with the payouts to our NEOs as follows:
Annual Cash
Incentive
Compensation
Targets ($)
Annual Cash
Incentive
Compensation
Actually Paid
at 5% of
Target ($)
Richard F. Westenberger
$
658,750
$
33,000
Kendra D. Krugman
$
658,75
$
0
33,000
Allison M. Peterson1
$
272,774
$
13,700
Raghu R. Sagi2
$
304,521
$
15,300
Michael D. Casey
$
2,010,000
$
100,500
Brian J. Lynch3
$

$

1Ms. Peterson joined Carter's in July 2024 and received a pro-rated bonus based on the number of days of service in 2024.
2Mr. Sagi joined Carter's in April 2024 and received a pro-rated bonus based on the number of days of service in 2024.
3Mr. Lynch retired from Carter's in February 2024 and did not receive any 2024 annual cash incentive compensation.
44

2024 LONG-TERM EQUITY INCENTIVE COMPENSATION
We provide long-term equity incentive awards to our NEOs to balance the short-term focus of the annual
cash incentive program by tying a significant portion of total compensation to performance achieved by
the Company over multi-year periods. The structure and design of our long-term equity incentive awards
are designed to directly link the value of the awards granted to the NEOs with the Companys long-term
financial performance and increases in stockholder value.
AWARD MIX
In fiscal 2024, the Committee approved a 50%/50% mix of annual time-based restricted stock grants
(which vest over four years in 25% increments on the annual anniversary of the grant date) and two types
of three year performance-based restricted stock grants (PSAs) for each NEO. These grants reflect our
historical practice of awarding a combination of time-based and performance- based restricted stock to
Carters NEOs.
FISCAL 2024 LONG-TERM EQUITY INCENTIVE AWARD OPPORTUNITIES
NEO's annual equity grant is determined based on her or his performance, market pay data, and
considerations of the competitiveness of their overall compensation package. Based on these factors, for
Fiscal 2024 the Committee determined to grant long-term equity incentive awards to the NEOs with the
aggregate grant date fair value shown below.
NEO
2024 Long-Term Equity Incentive Award1
Richard F. Westenberger
$1,609,960
Kendra D. Krugman
$1,609,960
Allison M. Peterson2
$2,500,190
Raghu Sagi3
$1,000,120
Michael D. Casey
$6,976,664
Brian J. Lynch4
$
1 Amounts assume target attainment of metrics under performance-based restricted stock awards.
2 In connection with Ms. Peterson joining Carter's in July 2024, Ms. Peterson received an award of time-based restricted stock that
vests over four years in 25% increments on the annual anniversary of the grant date.
3 In connection with Mr. Sagi joining Carter's in April 2024, Mr. Sagi received an award of time-based restricted stock that vests
over four years in 25% increments on the annual anniversary of the grant date.
4 Mr. Lynch retired from Carter's in February 2024 and did not receive any long-term equity incentive awards in 2024.
PERFORMANCE-BASED RESTRICTED STOCK AWARD MEASUREMENT
The combined Company PSAs and relative total shareholder return (
relative TSR) PSAs granted by the
Committee in fiscal 2024 measure a mix of net sales growth, adjusted earnings per share (adjusted EPS) as
reported to shareholders, and relative TSR over a three-year period from fiscal 2024 to fiscal 2026, as
shown below. The Committee selected these metrics as they represent key areas of focus for Carters and
align compensation with long-term shareholder value.
45
Proxy

Fiscal 2024 to 2026 PSA
Metrics
Weighting
Net Sales1
33%
Adjusted EPS1
33%
Relative TSR2
34%
1 Target performance for these metrics was set, at the time of grant, for the first year of the performance period, and the target
performance for each of the following years (2025 and 2026) is based on a set rate of growth (included in the award agreement)
in the actual performance for the prior year. For example, if the net sales target for 2024 was set at $2.8 billion, but actual
performance for 2024 was $2.7 billion, the target net sales for 2025 would be based on a growth rate related to $2.7 billion in net
sales. The Committee sought to set challenging goals for the fiscal 2024 net sales and adjusted EPS metrics.
2 Target performance was set at a three-year relative TSR that equals or exceeds the 50th percentile of a comparator group
consisting of a selection of companies in the S&P 1500 Apparel, Accessories & Luxury Goods Index and the S&P 1500 Apparel
Retail Index.
The number of PSAs earned will depend on Carters level of achievement with respect to each metric,
ranging from 25% of target for performance at threshold to 200% of target for performance at maximum.
No PSAs will be earned if performance falls below the threshold level of performance for all three metrics.
If the performance level falls between threshold and target or between target and maximum, the level of
payout is determined through linear interpolation.
46

COMPLETED AND OUTSTANDING PERFORMANCE SHARE AWARD CYCLES
The final measurement period for the fiscal 2022 to fiscal 2024 PSA cycle was completed as of the end of
fiscal 2024. A summary of the net sales and adjusted EPS metrics are below, and as indicated in the table,
no payouts were attained for these PSAs.
Fiscal 2022 to Fiscal 2024
Metric
Threshold
Target
Maximum
Actual
Payout %
Net Sales
(50%
weighting)
(in millions)

2022: $3,295

2023: 1%
growth in
actual 2022 net
sales

2024: 1%
growth in actual
2023 net sales

2022: $3,595

2023: 3% growth
in actual 2022 net
sales

2024: 3% growth
in actual 2023 net
sales

2022: $3,670

2023: 5% growth
in actual 2022 net
sales

2024: 5% growth
in actual 2023 net
sales

2022:
$3,212

2023:
$2,946

2024:
$2,844
0%
Adjusted
EPS (50%
weighting)

2022: $7.50

2023: 2%
growth in
actual 2022
adjusted EPS

2024: 2%
growth in actual
2023 adjusted
EPS

2022: $9.02

2023: 9% growth
in actual 2022
adjusted EPS

2024: 9% growth
in actual 2023
adjusted EPS

2022: $9.21

2023: 11%
growth in actual
2022 adjusted
EPS

2024: 11%
growth in actual
2023 adjusted
EPS

2022:
$6.90

2023:
$6.19

2024:
$5.81
0%
Total
Attainment
0%
TIME-BASED RESTRICTED STOCK
All of the time-based restricted stock awards granted to our NEOs in fiscal 2024:
 are subject to the equity retention policy described below;
 are contingent on the NEOs continued employment with Carter's through each vesting date; and
 vest in four equal annual installments on the first through fourth anniversaries of each grant date.
STOCK OWNERSHIP GUIDELINES AND EQUITY RETENTION POLICY
The Committee regularly reviews the equity ownership of our NEOs compared to our minimum ownership
guidelines. Under our minimum ownership guidelines, no NEO may sell shares of Carters stock (other
than to cover the tax obligations resulting from the vesting of Carters restricted stock (both time and
performance-based) or from exercising vested stock options) until they own shares of Carters stock with
a total market value in excess of a specified multiple of his or her base salary and continue to maintain
such level of ownership afte
f
r such sale. For fiscal 2024 (similar to the multiples for 2023), the ownership
multiples for our NEOs were as follows:
47
Proxy

Multiple of
Base Salary
Chief Executive Officer & President
7x
Senior Executive Vice Presidents & Executive Vice Presidents
3x
Under our minimum ownership guidelines, all unvested restricted stock and vested shares are included in
determining compliance with the ownership multiple, but unvested performance-based restricted stock
are excluded from the calculation of shares of stock held by the executive.
In addition, our equity retention policy for NEOs requires that any time-based restricted stock granted
to a NEO be held for four years following the date of grant before those shares may be sold, except for
any withholding to cover tax obligations resulting from the vesting of such shares. The policy also
requires that shares underlying time-based options granted be held for at least one year from the date
of vesting. During fiscal 2024, each of our NEOs was in compliance with his or her applicable minimum
ownership requirement.
401(K) PLAN
Carters 401(k) program provides for a Company match of employee contributions, including
contributions by NEOs, at the discretion of Carter's, based on Carters performance. In January 2025, the
Committee approved that employee contributions made to Carters 401(k) plan in fiscal 2024 would be
matched by Carter's 100% up to 4% of the employees eligible compensation for all eligible employees,
up to the maximum amount permitted by the Internal Revenue Service. This matching contribution was
approved by the Committee following its consideration of our employees efforts for fiscal 2024.
PERQUISITES AND OTHER BENEFITS
Our NEOs do not receive any perquisites or other benefits on an annual basis that are not otherwise
available to all employees. The cost of providing these benefits and perquisites to the NEOs is included
in the amounts shown in the 
All Other Compensation column of the Summary Compensation Table
and detailed in the footnotes to such table.
INSIDER TRADING POLICY
We maintain an Insider Trading Policy governing the purchase, sale, and/or other dispositions of our
securities by our directors, officers, and employees, as well as by Carters, that we believe is reasonably
designed to promote compliance with insider trading laws, rules, and regulations, and the exchange
listing standards applicable to us. A copy of our Insider Trading Policy was filed as an exhibit to our Annual
Report on Form 10-K for the fiscal year ended December 28, 2024.
CLAWBACK AND HEDGING POLICIES
Carter's has adopted a clawback policy, consistent with the requirements of Rule 10D-1 under the
Exchange Act and the related NYSE listing standards, that requires an executive officer to repay or
return erroneously awarded compensation in the event of an accounting restatement of previously-
reported financial results.
Further, hedging and pledging of Company stock by any Board member or employee of Carters,
including our NEOs, is prohibited under our policies to ensure that the interests of the holders of
48

Carters stock are fully aligned with those of shareholders in general. During fiscal 2024, none of our
NEOs entered into a hedging arrangement or pledged any shares of Carter's stock.
RETIREMENT OF FORMER PRESIDENT & CONSULTING AGREEMENT
In connection with Mr. Lynch's retirement in February 2024, the Company entered into a consulting
agreement with Mr. Lynch pursuant to which Mr. Lynch served as a consultant to the Company following
his retirement to assist with an orderly transition. The consulting agreement provides for, among other
things: (i) a term of twelve months through the end of February 2025; and (ii) a consulting fee of $125,000
per month payable by the Company to Mr. Lynch for the consulting services provided to the Company
during the period of the consulting agreement, which consulting services include consultations with
executive officers and other management personnel of the Company related to the business of the
Company and assistance with leadership transitions at the Company.
In addition, pursuant to the terms of the outstanding award agreements governing Mr. Lynch's unvested
performance-based restricted stock, Mr. Lynch received 
retirement treatment for those outstanding
awards upon his retirement in February 2024. This treatment resulted in pro-rated vesting of his
performance-based restricted stock (calculated based on the number of days he worked at the Company
from the grant date through the retirement date) subject to the achievement, by the Company, of the
performance metrics under the applicable award agreements.
RETIREMENT OF FORMER CHAIRMAN AND CHIEF EXECUTIVE OFFICER & RETIREMENT
AGREEMENT
In connection with Mr. Casey's retirement in February 2025, Carters and Mr. Casey entered into a
Retirement Agreement and Release, dated February 20, 2025. Under the Retirement Agreement and
Release, Mr. Casey received accelerated vesting of his outstanding unvested time-based restricted stock
awards and pro-rated vesting of his PSAs issued in 2023 and 2024 (subject to the attainment of the
performance metrics under those awards).
APPOINTMENT OF INTERIM CHIEF EXECUTIVE OFFICER
In connection with Mr. Casey's retirement as Chairman and Chief Executive Officer, the Board appointed
Richard F. Westenberger as Interim Chief Executive Officer, effective January 5, 2025. Mr. Westenbergers
appointment ended on April 3, 2025 in connection with the appointment of Douglas C. Palladini as Chief
Executive Officer & President. Mr. Westenberger is continuing to serve in his role as Senior Executive Vice
President, Chief Financial Officer & Chief Operating Officer.
In his capacity as Interim CEO, Mr. Westenberger received a monthly cash stipend of $110,000, and also
received restricted stock awards in an amount of $300,000 pursuant to the Companys Amended and
Restated Equity Incentive Plan on a quarterly basis (the 
Westenberger Awards), each vesting within one
year of the grant date of the relevant Westenberger Award. The Westenberger Awards will be immediately
vested in the event that Mr. Westenberger is terminated without cause or resigns for good reason prior to
the applicable vesting date, or in the event of his death or disability prior to the vesting date.
APPOINTMENT OF CHIEF EXECUTIVE OFFICER & PRESIDENT
On March 26, 2025, the Company announced that the Board approved the appointment of Douglas C.
Palladini as Chief Executive Officer and President of the Company and a member of the Board, effective
April 3, 2025 (the 
Effective Date). On the Effective Date, Richard F. Westenberger, who was serving as the
Companys Interim Chief Executive Officer, ceased to serve in that capacity but is continuing with the
Company as its Senior Executive Vice President, Chief Financial Officer & Chief Operating Officer.
49
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In connection with Mr. Palladinis appointment, Mr. Palladini and the Company executed an offer letter on
March 21, 2025 (the 
Offer Letter). Pursuant to the Offer Letter, during Mr. Palladinis employment with
the Company, he will receive an initial base salary of $1,200,000 per year, and an annual cash incentive
opportunity at target of 150%, which will be prorated for fiscal year 2025. Commencing in the Companys
fiscal year 2026, Mr. Palladini will be eligible to receive annual equity awards with a target value of
$5,500,000, pursuant to the terms of the Companys shareholder-approved equity plan.
Pursuant to the Offer Letter, on April 3, 2025, Mr. Palladini received a $7,000,000 sign-on equity grant, with
50% of the grant in the form of time-based restricted stock and 50% in the form of performance-based
restricted stock. The time-based restricted stock vests in four equal increments over a four-year period on
each of the anniversaries of the grant date. The performance-based restricted stock will be earned upon
achieving share price hurdles for 20 consecutive trading days over a three-year performance period,
starting on the award grant date (April 3, 2025) and ending on the third anniversary of the award grant
date (April 3, 2028). These share price hurdles are based on the closing price of stock on the grant date,
using the following growth rates:

1/3 at 30% growth;

1/3 at 60% growth;

1/3 at 90% growth.
The growth objectives may be achieved at any time over the three-year period, and the corresponding
number of shares earned, but the shares will not vest until the end of the three-year period.
Mr. Palladini is expected to enter into the Companys previously disclosed Severance Agreement and
participate in the employee benefit plans and programs provided by the Company to other senior
executives. Mr. Palladini will be covered by any Company directors and officers insurance policies. Mr.
Palladini will also be subject to the Companys restrictive covenants included in the Severance
Agreement, which include restrictions relating to non-competition and non-solicitation for 24 months
after the termination date and protection of confidential information.
SEVERANCE AGREEMENTS WITH NEOS
Each of our NEOs has a severance agreement with Carters. In the event that an NEO is terminated by
Carters for any reason, the NEO or his or her estate will be provided: (a) the NEOs base salary earned but
not paid during the final payroll period, (b) pay for any vacation time earned but not used through the
separation date, and (c) any business expenses incurred by the NEO but unreimbursed on the separation
date.
If an NEO is terminated without 
cause, or an NEO terminates their employment for 
good reason (with

cause and 
good reason defined in each NEOs respective severance agreement and summarized
below), the Company will be obligated to pay such NEOs base salary for 12 months in the cases of Messrs.
Westenberger and Sagi and Mses. Krugman and Peterson. In each case, base salary will be paid in bi-
weekly installments. The Company is also obligated to pay each NEO a pro-rated annual cash incentive
compensation amount that would have been earned by each such executive if he or she had been
employed at the end of the year in which his or her employment was terminated. The determination of
whether annual cash incentive compensation is payable to the NEO will not take into account any
individual performance goals and shall be based solely on the extent to which Company performance
goals have been met.
50

Further, the Company is obligated to pay the Companys contribution to the medical and dental benefits
for Messrs. Westenberger and Sagi and Mses. Krugman and Peterson, until the earlier of (i) 12 months
following his or her separation date, (ii) the date the NEO becomes eligible for coverage under the health
and/or dental plans of another employer, or (iii) the date the NEO otherwise ceases to be eligible to
continue participation in the Companys health and dental plans under COBRA. Additionally, the
Company is obligated to pay the Companys contribution to the life insurance benefits for 12 months in
the case of Messrs. Westenberger and Sagi and Mses. Krugman and Peterson. The payment of severance is
contingent on the NEO (a) executing an effective release of claims, and (b) complying with post-
termination obligations including confidentiality, noncompetition, and non-solicitation covenants.
In the event that, within two years following a 
change of control (with 
change of control defined in
each executives severance agreement) the Company terminates the NEOs employment, other than for

cause or such executive terminates his or her employment for 
good reason, the Company shall pay
such NEOs the following severance benefits in addition to the severance benefits in the preceding
paragraph: (a) base salary for an additional 12 months for all NEOs, (b) the Companys contribution to the
medical and dental benefits, if following the expiration of the 12-month anniversary of such termination,
the NEO has not yet become eligible for coverage under the health and/or dental plans of another
employer, then for an additional 6-month period thereafte
f
r (or, if earlier, until the date the NEO becomes
eligible for coverage under the health and/or dental plans of another employer), and (c) the Companys
contribution to the life insurance benefits, for an additional 12 months in the case of all NEOs. In the event
of a 
change of control of the Company: (1) for all unvested stock options and all unvested shares of
restricted stock (both time and performance-based) held by the NEO that were awarded prior to February
15, 2024, such awards will fully vest; and (2) for all unvested equity awards made on or after February 15,
2024, such awards will fully vest if there is a qualifying termination of employment within two years after
f
the change in control or if the surviving entity does not provide qualifying replacement awards.
Under the severance agreements with each of our NEOs, 
cause is generally deemed to exist when such
NEO has: (a) been convicted of a felony or entered a plea of guilty or no contest to a felony; (b) committed
fraud or other act involving dishonesty for personal gain which is materially injurious to the Company; (c)
materially breached his obligations of confidentiality, intellectual property assignment, non-competition,
non-solicitation, or non-disparagement against the Company after a cure period, provided such breach by
its nature was curable; (d) willfully engaged in gross misconduct which is injurious to the Company; or (e)
after a cure period, willfully refused to substantially perform his or her duties or is grossly negligent in
performance of such duties.
Under the agreements with our NEOs, 
good reason is generally deemed to exist when there is: (a) a
material reduction in the executives title, duties, or responsibilities; (b) a material change in the
geographic location at which the executive must perform services; or (c) a material breach of the
executives agreement by the Company, provided the NEO complies with the written notice requirements
and the cure period provided to Carter's.
See 
Potential Payments Upon Termination or Change of Control below for a discussion and
presentation of amounts our NEOs may be entitled to in the event of their termination, including
following a change in control.
51
Proxy

COMPENSATION & HUMAN CAPITAL COMMITTEE REPORT
The Compensation & Human Capital Committee of the Board has reviewed and discussed with
Company management the Compensation Discussion and Analysis included in this proxy statement.
Based on such review and discussions, the Compensation and Human Capital Committee has
recommended to the Board that the Compensation Discussion and Analysis be included in this proxy
statement for filing with the SEC.
Submitted by the Compensation & Human Capital
Committee
Mr. Jevin S. Eagle,
Mr. Rochester Anderson, Jr.
Mr. Luis Borgen
Mr. Mark P. Hipp
Ms. Stephanie P. Stahl
COMPENSATION & HUMAN CAPITAL COMMITTEE INTERLOCKS
AND INSIDER PARTICIPATION
The Compensation & Human Capital Committee is composed entirely of the five independent directors
listed above. No member of the Compensation & Human Capital Committee is a current, or during fiscal
2024 was a former, officer or employee of the Company or any of its subsidiaries. During fiscal 2024, no
member of the Compensation & Human Capital Committee had a relationship that must be described
under the SEC rules relating to disclosure of transactions with related persons. In fiscal 2024, none of
our executive officers served on the board of directors or compensation committee of any entity that
had one or more of its executive officers serving on the Board or the Compensation & Human Capital
Committee.
52

FISCAL 2024 SUMMARY COMPENSATION TABLE*
The table below provides information concerning the compensation of our NEOs.
Name and
Principal Position
Fiscal
Year
Salary
($)
(a)
Bonus
($)
(b)
Stock
Awards ($)
(c)
Non-Equity
Incentive Plan
Compensation
($)
(d)
All Other
Compensation
($)
(e)
Total
($)
Richard F. Westenberger
2024
$763,462
$
$1,609,960
$33,000
$176,496
$2,582,918
Senior Executive Vice President,
2023
$704,615
$
$1,550,520
$471,900
$169,734
$2,896,769
Chief Financial Officer & Chief
Operating Officer, former Interim
Chief Executive Officer
2022
$674,615
$128,500
$1,250,166
$
$125,585
$2,178,866
Kendra D. Krugman
2024
$760,577
$
$1,609,960
$33,000
$180,810
$2,584,347
Senior Executive Vice President,
2023
$683,846
$
$1,800,489
$462,000
$149,459
$3,095,794
Chief Creative & Growth Officer
2022
$609,231
$118,200
$1,000,862
$
$97,229
$1,825,522
Allison M. Peterson
2024
$346,154
$
$2,500,190
$13,700
$224,104
$3,084,148
Executive Vice President,
2023
$
$
$
$
$
$
Chief Retail & Digital Officer
2022
$
$
$
$
$
$
Raghu R. Sagi
2024
$392,308
$
$

1,000,120
$15,30
$
0
43,479
$1,451,207
Executive Vice President,
2023
$
$
$
$
$
$
Chief Information & Technology
Officer
2022
$
$
$
$
$
$
Michael D. Casey
2024
$1,326,154
$
$6,976,664
$100,500
$743,451
$9,146,769
Former Chairman,
2023
$1,282,692
$
$6,500,098
$1,716,000
$589,342
$10,088,133
Chief Executive Officer & President
2022
$1,192,885
$468,800
$6,500,136
$
$444,933
$8,606,754
Brian J. Lynch
2024
$169,231
$
$
$
$1,340,089
$1,509,320
Former President &
2023
$867,88
$
5

$2,500,266
$774,400
$241,106
$4,383,656
Chief Operating Officer
2022
$831,154
$211,300
$2,000,266
$
$165,949
$3,208,669
*
Amounts in rows may not add exactly to the total due to rounding.
(a)
Base salary for each NEO was based on a 364-day fiscal year for fiscal years 2024, 2023 and 2022.
(b)
Reflects the discretionary bonus that was awarded in 2023 based on fiscal 2022 performance, in light of the challenges faced by the Company due to the
COVID-19 pandemic, inflationary impact on consumers, and responses to other challenges in the Companys business including supply chain disruptions.
(c)
The amounts disclosed in this column represent the total grant date fair value for the following grants computed in accordance with FASB ASC Topic 718:
◦
The time-based restricted stock granted in 2024, 2023, and 2022 vest in four equal, annual installments beginning one year from the date of the grant,
except for a special restricted stock award granted to Ms. Krugman (in connection with her promotion in 2023) that includes a portion that cliff vests
on the third anniversary of the date of grant.
◦
Vesting of the performance-based restricted stock granted in fiscal 2024 is contingent upon meeting specific performance targets for each of
the three fiscal years 2024, 2025, and 2026, individually, and vest, as and to the extent performance criteria are met, in 2027 following
completion of fiscal 2026. For 2024, 34% of the total award of performance-based restricted shares included a relative TSR component (the

Market-Based Restricted Shares).
Name
Grant Date
Time-Based
Restricted
Shares  4
Year
Vest
Time-Based
Restricted
Shares  3
Year
Cliff Vest
Performance
-
Based
Restricted
Shares
Market-
Based
Restricted
Shares
Grant
Date Fair
Value per
Share
chard F. Westenberger
2/28/2024
9,152

6,040

$
81.95
2/28/2024



3,112
$
117.28
2/27/2023
10,468

10,468

$
74.06
2/16/2022
6,860

6,860

$
91.12
Kendra D. Krugman
2/28/2024
9,152

6,04

0
$
81.95
2/28/2024



3,112
$
117.28
2/27/2023
5,404

5,404

$
74.06
3/21/2023

14,022


$
71.32
2/16/2022
5,492

5,49

2
$
91.12
Allison M. Peterson
8/9/2024
39,920



$
62.63
2/27/2023




$
74.06
2/16/2022




$
91.12
Raghu R. Sag
5
i
/10/2024
14,484



$
69.05
53
Proxy

2/27/2023



$

74.06
2/16/2022



$

91.12
Michael D. Casey
2/28/2024
39,660

26,176

$
81.95
2/28/2024



13,484
$
117.28
2/27/2023
43,884

43,884

$
74.06
2/16/2022
35,668

35,668

$
91.12
Brian J. Lynch
2/28/2024




$
81.95
2/28/2024




$
117.28
2/27/2023
16,880

16,880

$
74.06
2/16/2022
10,976

10,976

$
91.12
(d) Reflects dollar value of all compensation earned in fiscal 2024, 2023, and 2022 pursuant to the Incentive Compensation Plan, including all
annual cash incentive compensation.
(e) The amounts shown as 
All Other Compensation for fiscal 2024 consist of the following:
Name
401 (k)
Company
Match
Dividends
Paid on
Unvested
Restricted
Stock
Other
(i)
Total
Richard F. Westenberger
$13,800
$159,098
$3,599
$176,497
Kendra D. Krugman
$13,800
$164,762
$2,249
$180,811
Allison M. Peterson
$8,077
$63,872
$152,155
$224,104
Raghu R. Sagi
$7,385
$34,762
$1,333
$43,480
Michael D. Casey
$13,800
$723,818
$5,834
$743,452
Brian J. Lynch
$
$89,139
$1,250,950
$1,340,089
(i)
These amounts include imputed income from health and life insurance contributions, imputed income from bring-your-own technology to work
programs, and benefits from healthcare programs, each of which are available to all employees, as well as: (1) $136,151 in relocation benefits for Ms.
Peterson and (2) $1,250,000 in consulting fees for Mr. Lynch.
54

FISCAL 2024 GRANTS OF PLAN-BASED AWARDS
The following table provides information concerning each grant of plan-based awards made to an NEO
in fiscal 2024. This includes incentive compensation awards granted under our Incentive Compensation
Plan and restricted stock awards granted under our Equity Incentive Plan. The threshold, target, and
maximum columns reflect the range of estimated payouts under these plans for fiscal 2024. The last
column reports the aggregate grant date fair value of all awards made in fiscal 2024 as if they were fully
vested on the grant date, computed in accordance with FASB ASC Topic 718.
Estimated
Future
Payouts
Under
Non-Equity
Incentive
Plan
Awards (a)
Estimated
Future
Payouts
Under
Equity
Incentive
Plan
Awards
Grant
Date Fair
Value of
Stock and
Option
Name
Awards
Name
Award
Type
Grant
Date
Threshold
($)
Target
($)
Maximum
($)
Threshold
(#)
Target
(#)
Maximum
(#)
Richard F.
Westenberger
Cash Incentive
Compensation

$164,688
$658,750
$988,125



$
Shares (b)
2/28/2024




9,152
9,152
$750,006
Shares (c)
2/28/2024



1,510
6,040
12,080
$494,978
Shares (d)
2/28/2024



778
3,112
6,224
$364,975
Kendra D.
Krugman
Cash Incentive
Compensation

$164,688
$658,750
$988,125


$


Shares (b)
2/28/2024




9,152
9,152
$750,006
Shares (c)
2/28/2024


1

,510
6,040
12,08
$
0
494,978
Shares (d)
2/28/2024


7

78
3,11
6
2
,224
$364,975
Allison M.
Peterson
Cash Incentive
Compensation

$68,193
$272,774
$409,161



$
Shares (b)
8/9/2024




39,920
39,920
$2,500,190
Raghu R. Sagi
Cash Incentive
Compensation
$

76,130
$304,452
$456,781


$


Shares (b)
5/10/2024
$
$
$

14,484
14,484
$1,000,120
Michael D
Casey.
Cash Incentive
Compensation

$502,500
$2,010,000
$3,015,000



$
Shares (b)
2/28/2024




39,660
39,660
$3,250,137
Shares (c)
2/28/2024



6,544
26,176
52,352
$2,145,123
Shares (d)
2/28/2024



3,371
13,484
26,968
$1,581,404
Brian J.
Lynch
Cash Incentive
Compensation

$
$
$





$
Shares (b)
2/28/2024





$
Shares (c)
2/28/2024





$
Shares (d)
2/28/2024






$
(a)
The amounts shown under the 
Threshold column represent 25% of the target cash incentive compensation, assuming threshold-level performance is
achieved under the financial performance measures and strategic objectives component. The amounts shown under the 
Target column represent 100%
of the target cash incentive compensation, assuming target-level performance is achieved under the financial performance measures and strategic
objectives component. The amounts shown under the 
Maximum column represent 150% of the target cash incentive compensation, assuming
maximum-level performance is achieved under the financial performance measures and the strategic objectives component. The Company achieved 5% of
"Target" for 2024.
(b)
Shares of time-based restricted stock were granted pursuant to the Equity Incentive Plan. These restricted shares vest ratably in four equal, annual
installments beginning one year from the date of the grant.
(c)
Shares of performance-based restricted stock were granted pursuant to the Equity Incentive Plan. The amounts shown under the 
Threshold column
represent 25% of the target grant award, assuming threshold-level performance is achieved under the performance vesting criteria in each of the fiscal
years 2024, 2025, and 2026. The amounts shown under the 
Target column represent 100% of the target grant award, assuming target-level performance
is achieved under the performance vesting criteria in each of the fiscal years 2024, 2025, and 2026. The amounts shown under the 
Maximum column
represent 200% of the target grant award, assuming maximum-level performance is achieved under the performance vesting criteria in each of the fiscal
years 2024, 2025, and 2026. Additional shares above Target performance, if any, will be issued following completion of the performance period and
determination by the Compensation and Human Capital Committee that the additional shares above Target were earned. Shares above Target have not
been issued and do not carry voting rights or rights to receive dividends. The dollar amounts under the 
Grant Date Fair Value of Stock and Option Awards
are calculated based on the number of awards reported under the 
Target column.
(d)
Market-based restricted shares were granted pursuant to the Equity Incentive Plan. The amounts shown under the 
Threshold column represent 25% of
the target grant award, assuming threshold-level performance is achieved under the relative TSR vesting criteria in each of the fiscal years 2024, 2025, and
2026. The amounts shown under the 
Target column represent 100% of the target grant award, assuming target-level performance is achieved under the
relative TSR vesting criteria in each of the fiscal years 2024, 2025, and 2026. The amounts shown under the 
Maximum column represent 200% of the
target grant award, assuming maximum-level attainment under the relative TSR vesting criteria in each of the fiscal years 2024, 2025, and 2026. Additional
55
Proxy

shares above Target performance, if any, will be issued following completion of the performance period and determination by the Compensation and
Human Capital Committee that the additional shares above Target were earned. Shares above Target have not been issued and do not carry voting rights
or rights to receive dividends. The dollar amounts under the 
Grant Date Fair Value of Stock and Option Awards are calculated based on the number of
awards reported under the 
Target column.
56

OUTSTANDING EQUITY AWARDS AT FISCAL 2024 YEAR-END
The following table provides information regarding unexercised stock options, stock that has not yet
vested, and equity incentive plan awards for each NEO outstanding as of the end of fiscal 2024. Each
outstanding award is represented by a separate row that indicates the number of securities underlying
the award.
Options Awards
Stock Awards
Name
Number of
Securities
Underlying
Unexercised
Options
(#)
(Exercisable)
Number of
Securities
Underlying
Unexercised
Options
(#)
(Unexercisable)
Equity Incentive
Plan Awards:
Number of
Securities
Underlying
Unexercised
Unearned
Options
(#)
Option
Exercise
Price
($)
Option
Expiration
Date
Equity Incentive
Plan Awards:
Number of
Unearned
Shares,
Units or
Other Rights
That Have
Not Vested
(#) (a)
Equity Incentive
Plan Awards:
Market or
Payout Value
of
Unearned Shares,
Units or Other
Rights That Have
Not Vested
($) (b)
Richard F.
Westenberger
5,048

 $
120.25
2/21/2028
7,000

 $
83.84
2/14/2027
5,220

 $
90.66
2/16/2026
3,400

 $
82.40
2/18/2025
49,718 $
2,706,151
Kendra D.
Krugman
1,508


$
120.2
2
5
/21/2028
1,508


$
120.2
2
5
/21/2028
2,068


$
83.84
2/14/2027
1,404


$
83.84
2/14/2027
2,260


$
98.98
8/17/2026
960


$
90.66
2/16/2026
960


$
90.66
2/16/2026
2,360


$
86.88
11/11/202
5
1,200


$
82.40
2/18/2025
400


$
82.40
2/18/2025
51,488 $
2,802,492
Allison M.
Peterson


 $


39,920 $
2,172,846
Raghu R. Sagi


 $


14,484 $
788,364
Michael D.
Casey
49,268

 $
120.25
2/21/2028
69,000

 $
83.84
2/14/2027
44,500

 $
90.66
2/16/2026
28,000

 $
82.40
2/18/2025
226,193 $
12,311,685
Brian J. Lynch



120.25
2/21/2028


 $
120.25
2/14/2027


 $
83.84
2/16/2026


 $
83.84
2/18/2025
27,856 $
1,516,202
[See next page for footnotes to table]
57
Proxy

(a)
Equity Incentive Plan awards relate to the following grants:
Name
Grant
Date
Time-Based
Restricted
Shares  4 Year
Vest #
Time-Based
Restricted
Shares  3 Year
Cliff Vest #
Performance-
Based
Restricted
Shares
Market-
Based
Restricted
Shares
Grant
Date Fair
Value per
Share
Richard F. Westenberger
2/28/2024
9,152

6,040
 $
81.95
2/28/2024



3,112 $
117.28
2/27/2023
7,851

10,468
 $
74.06
2/16/2022
3,430

6,860
 $
91.12
2/10/2021
2,805


 $
98.05
Kendra D. Krugman
2/28/2024
9,152

6,040
 $
81.95
2/28/2024



3,112 $
117.28
2/27/2023
4,053
5

,404
 $
74.06
3/21/2023

14,022

 $
71.32
2/16/2022
2,746

5,492
$

91.12
2/10/2021
1,467



$
98.05
Allison M. Peterson
8/9/2024
39,920


 $
62.63
Raghu R. Sagi
5/10/2024
14,484
$
69.05
Michael D. Casey
2/28/2024
39,660

26,176
 $
81.95
2/28/2024



13,484 $
117.28
2/27/2023
32,913

43,884
 $
74.06
2/16/2022
17,834

35,668
 $
91.12
2/10/2021
16,574


 $
98.05
Brian J. Lynch
2/28/2024



 $
81.95
2/28/2024



 $
117.28
2/27/2023


16,880
 $
74.06
2/16/2022


10,976
 $
91.12
2/10/2021



 $
98.05
(b) Amount based on the closing market price per share of the Companys common stock as traded on the NYSE on
December 27, 2024, the last trading day of fiscal 2024, of $54.43.
58

OPTION EXERCISES AND STOCK VESTED IN FISCAL 2024
The following table provides information concerning our NEOs exercises of stock options and vesting of
restricted stock (both time and performance-based) during fiscal 2024. The table reports, on an
aggregate basis, the number of securities acquired upon exercise of stock options, the dollar value
realized upon exercise of stock options, the number of shares of restricted stock that have vested, and
the dollar value realized upon the vesting of restricted stock.
Option Awards
Stock Awards
Name
Number of
Shares
Acquired
on Exercise
(#)
Value Realized
on Exercise
($) (a)
Number of
Shares
Acquired
on Vesting
(#)
Value Realized
on Vesting
($) (b)
Richard F. Westenberger

$
19,604
$1,591,388
Kendra D. Krugman

$
15,043
$1,221,402
Allison M. Peterson

$

$
Raghu R. Sagi

$

$
Michael D. Casey

$
43,259
$3,511,595
Brian J. Lynch

$
25,012
$2,029,844
(a)
Aggregate dollar amount was calculated by multiplying the number of shares acquired by the difference between the market price of
the underlying securities at the time of exercise and the exercise price of the stock options.
(b)
Aggregate dollar amount was calculated by multiplying the number of shares acquired on vesting by the closing market price of the
Companys common stock as traded on the NYSE on the date of vesting.
59
Proxy

NONQUALIFIED DEFERRED COMPENSATION
Eligible employees, including our NEOs, may elect annually to defer a portion of their base salary and
annual cash incentive compensation under The William Carter Company Deferred Compensation
Plan (the 
Deferred Compensation Plan). Under this plan, participants can defer up to 75% of their
salary and/or 90% of their cash bonus. At the option of the participant, these amounts may be
deferred to a specific date at least two years from the last day of the year in which deferrals are
credited into the participants account. Interest on deferred amounts is credited to the participants
account based upon the earnings and losses of one or more of the investments selected by the
participant from the various investment alternatives available under the Deferred Compensation
Plan.
At the time of deferral, a participant must indicate whether he or she wishes to receive the amount
deferred in either a lump sum or in substantially equal annual installments over a period of up to five
years for 
Specified Date accounts or up to ten years for 
Retirement accounts. If a participant who is
an employee of the Company separates from service prior to the elected commencement date for
distributions and has not attained age 62, or age 55 and completed ten years of service, then the
deferred amounts will be distributed as a lump sum, regardless of the method of distribution originally
elected by the participant. If the participant in question has attained age 62, or age 55 with ten years of
service and has previously elected to do so on a timely basis, then the participant may receive the
amounts in substantially equal annual installments over a period of up to ten years. There is a six-month
delay in the commencement of distributions for all participants, if triggered by the participants
termination or retirement. Changes to deferral elections with respect to previously deferred amounts
are permitted only under the limited terms and conditions specified in the Code and early withdrawals
from deferred accounts are permitted only in extreme cases, such as unforeseen financial hardship
resulting from an illness or accident of the participant that is demonstrated to the Companys
Retirement Committee.
Name
Employee
Contributions in
2024
(a)
Company
Contributions
in 2024
Aggregate
Earnings in
2024 (b)
Aggregate
Withdrawals
or
Distributions
Aggregate
Balance at
End of 2024
(c)
Richard F.
Westenberger
$7,592
$
$33,283
$
$334,552
Kendra D. Krugman
$
$
$
$
$
Allison M. Peterson
$
$
$
$
$
Raghu R. Sagi
$150,000
$
$3,519
$
$153,519
Michael D. Casey
$
$
$
$
$
Brian J. Lynch
$
$
$365,304
$
$3,018,859
(a)
All of the amounts reported in this column for Ms. Wilson are also included within the amount reported for that officer in the Summary
Compensation Table.
(b)
None of the amounts reported in this column are reported in the All Other Compensation column of the Summary Compensation Table
because the Company does not pay guaranteed or preferential earnings on deferred compensation.
(c)
Amounts reported in this column for each NEO include amounts previously reported in the Companys Summary Compensation Table in
previous years when earned if that NEOs compensation was required to be disclosed in a previous year.
60

POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE OF
CONTROL
TERMINATION
As described in more detail above under the heading 
Severance Agreements with NEOs, we have
entered into certain agreements and maintain certain plans that may require us in the future to make
certain payments and provide certain benefits in the event of a termination of employment.
For purposes of the table below, a hypothetical termination without 
cause or resignation for 
good
reason is assumed to have occurred as of December 28, 2024, the last day of fiscal 2024. The table
below indicates the payment and provision of other benefits that would be owed to each of our NEOs as
the result of such a termination, as well as unvested performance-based restricted stock that is eligible
for 
retirement treatment under the applicable award agreements. There can be no assurance that a
termination of employment of any of our NEOs would produce the same or similar results as those set
forth below on any other date. The terms 
without cause and 
good reason are defined in the
agreements with our executives and summarized above under the heading 
Severance Agreements with
NEOs. In addition, in the table below, we have included the potential vesting of performance-based
restricted stock for those executives who are eligible to receive 
retirement treatment for those
outstanding awards. Under the award agreements for the outstanding performance-based restricted
stock grants, a recipient is eligible for 
retirement treatment if the executive ends his or her
employment with the Company on or after the date that they have reached age 60 and completed at
least five years of service with the Company (but only to the extent that circumstances constituting

Cause, as defined under the agreement, do not exist). For awards that receive 
Retirement
treatment, the executive is eligible to receive pro-rated vesting (if any) of the performance-based
restricted stock (calculated based on the number of days the executive worked at the Company from
the grant date through the retirement date) subject to the ultimate achievement, by the Company, of
the performance metrics under the applicable award agreements.
Richard
F.
Westenberger
Kendra
D.
Krugman
Allison
M.
Peterson
Raghu
R.
Sagi
Michael
D.
Casey
Brian
J.
Lynch
Base Salary
$775,000
$775,000
$750,000
$600,000
$2,680,000
$
Cash Incentive Compensation (a
3
)
3,000
33,000
13,700
15,300
100,500

Health and Other Benefits
17,538
6,533
16,502
16,502
35,073
15,915
Retirement Treatment of
Performance-Based Restricted
Stock (b)




4,238,309
1,206,072
Total
$825,538
$814,533
$780,202
$631,802
$7,053,882
$1,221,987
(a)
Cash incentive compensation calculations are based on cash incentive compensation targets achieved in fiscal 2024 described in more detail under
the heading 
Annual Cash Incentive Compensation above.
(b)
Calculated based on the closing stock price ($54.43) of the Companys stock on the last trading day (December 27, 2024) of the Company 2024 fiscal
year, and assuming that the Committee certifies performance at 
Target under the applicable award agreements for the performance-based
restricted stock.
In connection with Mr. Lynch's retirement in February 2024, the Company entered into a consulting
agreement with Mr. Lynch pursuant to which Mr. Lynch served as a consultant to the Company following
his retirement to assist with an orderly transition. The consulting agreement provides for, among other
things: (i) a term of twelve months concluding on March 1, 2025; and (ii) a consulting fee of $125,000 per
month payable by the Company to Mr. Lynch for the consulting services provided to the Company during
the period of the consulting agreement, which consulting services include consultations with executive
61
Proxy

officers and other management personnel of the Company related to the business of the Company and
assistance with leadership transitions at the Company.
In connection with Mr. Casey's retirement in February 2025, Carter's and Mr. Casey entered into a
Retirement Agreement and Release, dated February 20, 2025. Under the Retirement Agreement and
Release, Mr. Casey received accelerated vesting of his outstanding unvested restricted stock awards and
pro-rated vesting of his performance share awards issued in 2023 and 2024 (subject to the attainment of
the performance metrics under those awards).
62

CHANGE OF CONTROL AND TERMINATION FOLLOWING CHANGE OF CONTROL
the event of a change of control, which is defined under the Equity Incentive Plan and individual
awards as a 
Covered Transaction, all unvested stock options and all unvested shares of time-based
restricted stock will fully vest, and all unvested shares of performance-based restricted stock will vest at
their respective 
target amounts. In addition, as described in more detail above under the heading

Severance Agreements with NEOs, we have entered into certain agreements that may require us to
make certain payments and provide certain benefits to our NEOs in the event of their termination in
relation to a change of control (with 
change of control defined in each executives severance
agreement).
For purposes of the table below, we have assumed that all unvested stock options, and all unvested
shares of time-based restricted stock and performance-based restricted stock, have fully vested
immediately prior to a change of control on December 28, 2024, the last day of fiscal 2024, and that a
termination without 
Cause (as defined under the Equity Incentive Plan) occurred immediately
following a change of control on December 28, 2024. The estimated benefit amount for unvested
options was calculated by multiplying the number of in-the-money unvested options held by the
applicable NEO by the difference between the closing price of our common stock on December 27, 2024
(which was the last trading day before the end of fiscal 2024), as reported by the NYSE, which was
$54.43, and the exercise price of the option. The estimated benefit amount of unvested restricted stock
was calculated by multiplying the number of restricted shares held by the applicable NEO by the closing
price of our common stock on December 27, 2024 (which was the last trading day before the end of
fiscal 2024), as reported by the NYSE, which was $54.43. As noted in our Compensation Discussion &
Analysis section, effective February 15, 2024, the Company amended its Equity Incentive Plan to include
double-trigger change of control provisions to more closely-align the Company's pay practices with
market practice. For equity awards in fiscal 2024 and beyond, the vesting of the awards will be
accelerated if either (1) the surviving entity does not provide replacement awards that meet criteria as
set forth in the Equity Incentive Plan or, if applicable, the award agreement (referred to as 
qualifying
replacement awards), or (2) the surviving entity provides qualifying replacement awards, but there is a
termination of employment for Cause or resignation for Good Reason (as defined in the Equity Incentive
Plan) within two years afte
f
r the change in control.
There can be no assurance that a change of control would produce the same or similar results as those
set forth below on any other date or at any other price. These amounts do not include vested stock
options, vested shares of time-based restricted stock, or vested shares of performance-based
restricted stock. For a list of earned vested stock options, see the 
Outstanding Equity Awards at Fiscal
2024 Year-End table beginning on page 57.
Richard
F.
Westenberger
Kendra
D.
Krugman
Allison
M.
Peterson
Raghu
R.
Sagi
Michael
D.
Casey
Brian
J.
Lynch
Base Salary
$1,550,000
$1,550,000
$1,500,000
$1,200,000
$4,020,000
$
Cash Incentive
Compensation (a)
33,000
33,000
13,700
15,300
100,500

Health and Other
Benefits
35,075
13,066
33,004
33,004
52,609
26,525
Stock Value
1,264,844
1,711,279
2,172,846
788,364
5,822,976

Total
$2,882,919
$3,307,345
$3,719,550
$2,036,668
$9,996,085
$26,525
(a)
Cash incentive compensation calculations are based on cash incentive compensation targets achieved in fiscal 2024 described in more detail under
the heading 
Annual Cash Incentive Compensation above.
63
Proxy

PAY RATIO DISCLOSURE
The following information about the relationship between the compensation of our employees and the
compensation of Mr. Casey, our former Chief Executive Officer (our Principal Executive Officer, or 
PEO,
for fiscal 2024), is provided in compliance with the requirements of Item 402(u) of Regulation S-K (the

Pay Ratio Disclosure Requirement). In fiscal 2024, the total compensation of our median-
compensated employee was $12,008.
We selected a new Median Employee in fiscal 2024 due to last years median employees substantial
change in hours worked for the Company.
Our Median Employee is a part-time employee at one of our U.S. retail store locations whose annual total
compensation for fiscal 2024 (as calculated pursuant to Item 402(c)(2)(x) of Regulation S-K) was $12,008.
The annual total compensation for fiscal 2024 for our PEO was $9,146,769. The resulting ratio of our PEOs
pay to the pay of our Median Employee for fiscal 2024 was 762:1.
METHODOLOGY TO IDENTIFY OUR MEDIAN EMPLOYEE
In order to identify our Median Employee, we began with a list of all of our employees, world-wide, who
were employed by Carters or one of its wholly-owned subsidiaries on October 1, 2024. Of these
employees, approximately 37% were full-time employees, 47% were part- time employees, and 15%
were seasonal or temporary employees. Approximately 75% of our employees were employed in our
retail stores in North America, and approximately 79% of those retail employees were part-time.
We then calculated each employees compensation for 2024. When making this calculation, we:
 consistently used each employees total salary for the 2024 calendar year as stated on the gross
compensation line on their Form W-2 (or international equivalent);
 annualized salaries for those full-time and part-time employees that were not employed for the full
calendar year of 2024 (but we did not annualize seasonal or temporary employee data);
 excluded benefits, such as health care contributions; and
 for compensation paid in currencies other than U.S. dollars, applied an exchange rate into
U.S. dollars that was based on rates published by xe.com on October 1, 2024.
64

PAY VERSUS PERFORMANCE DISCLOSURE
As required by Section 953(a) of the Dodd-Frank Act and Item 402(v) of Regulation S-K, the table
summarizing executive compensation paid versus financial performance measures for our five most
recently completed fiscal years is set forth below:
Year
(a)
Value of Initial Fixed $100
investment based on:
Summary
Compensation
Table Total
for PEO
(b)
Compensation
Actually Paid
to PEO(1)
(c)
Average
Summary
Compensation
Table Total for
Non-PEO
NEOs
(d)
Average
Compensation
Actually Paid
to Non-PEO
NEOs(2)
(e)
Total
Shareholder
Return(3)
(f)
Peer Group
Total
Shareholder
Return(4)
(g)
Net Income
(dollars in
thousands)(5)
(h)
Adjusted
Operating
Income
(dollars in
thousands)
(6)
(i)
2024
$
9,146,769
$
2,030,618
$
2,242,388
$
586,590
$
57.59
$
69.31
$
185,509
$
286,550
2023
10,088,133
7,858,875
3,061,079
2,624,467
75.89
73.34
232,500
327,816
2022
8,606,754
4,760,564
2,264,230
1,619,056
72.36
67.87
250,038
388,171
2021
11,056,385
13,931,119
3,801,288
4,249,437
94.49
103.90
339,748
500,764
2020
7,297,118
(185,504)
1,648,590
579,698
86.62
92.36
109,717
279,764
(1)
The dollar amounts reported in the column 
Compensation Actually Paid to PEO (column (c)) represent the amount of Compensation Actuallyto Michael
Casey, our former CEO, as computed in accordance with Item 402(v) of Regulation S-K. The dollar amounts do not reflect the actual amount of
compensation earned by or paid to the CEO during the applicable year. To calculate CAP to the CEO, for each of the years shown, the following amounts
were deducted from and added to Summary Compensation Table total compensation:
PEO Summary Compensation Table Total to Compensation Actually Paid Reconciliation
Year
Summary
Compensation
Table Total
Deductions
from Summary
Compensation Table
Total(i)
Equity Award
Adjustments(ii)
Compensation
Actually Paid
2024
$
9,146,769
$
(6,976,664)
$
(139,487)
$
2,030,618
2023
10,088,133
(6,500,098)
4,270,840
7,858,875
2022
8,606,754
(6,500,136)
2,653,947
4,760,564
2021
11,056,385
(6,500,323)
9,375,057
13,931,119
2020
7,297,118
(6,000,392)
(1,482,230)
(185,504)
(i)
Represents the grant date fair value of equity-based awards granted each year, as shown in the Stock Awards column of the Summary Compensation
Table.
(ii)
Reflects the value of equity-based awards calculated in accordance with the SEC methodology for determiningCompensation Actually Paid for each
year shown under generally accepted accounting principles. The fair value of our performance-based restricted stock is calculated based on the
probable outcome of the performance conditions determined as of the last day of the fiscal year and our closing stock price on such day. The
determination of equity award adjustments to Summary Compensation Table total compensation is detailed in the supplemental table below.
PEO Equity Component of Compensation Actually Paid
Year
Fair Value of
Equity
Awards
Granted in
the Year
and
Outstanding
and
Unvested as
of Year End
Year over Year
Change in Fair
Value of Equity
Awards Granted
in Prior Years
and
Outstanding
and Unvested
as of Year End
Fair Value as of
Vesting Date of
Equity Awards
Granted and
Vested in the
Year
Year over Year
Change in Fair
Value of
Equity Awards
Granted in
Prior Years
that Vested in
the Year
Fair Value at the
End of the Prior
Year of Equity
Awards that were
Forfeited in the
Year
Value of
Dividends or
other Earnings
Paid on Equity
Awards not
Otherwise
Reflected in Fair
Value or Total
Compensation
Total
Equity
Award
Adjustments
$3,470,704
$(3,882,120)
$
$271,929
$
$
$(139,487)
2023
5,587,004
(1,441,983)

125,819


4,270,840
2022
4,923,201
(1,890,720)

(378,534)


2,653,947
2021
6,710,481
2,626,294

38,282


9,375,057
2020
2,557,575
(3,438,221)

(601,584)


(1,482,230)
(2)
The dollar amounts reported in the column 
Average Compensation Actually Paid to Non-PEO NEOs (column (e)) represent the average amount of
Compensation Actually Paid to the non-CEO named executive officers (
Non-CEO NEOs) as a group, as computed in accordance with Item 402(v) of
Regulation S-K. The dollar amounts do not reflect the actual average amount of compensation earned by or paid to the Non-CEO NEOs during the applicable
year. The Non-CEO NEOs reflected in columns (d) and (e) consist of the following individuals for each of the years shown: 2024Richard Westenberger,
Kendra Krugman, Allison Peterson, Raghu Sagi, and Brian Lynch; 2023Richard Westenberger, Brian Lynch, Kendra Krugman, and Julie D'Emilio; 2022
Richard Westenberger, Brian Lynch, Patrick Moore, and Kendra Krugman; 2021Richard Westenberger, Brian Lynch, Patrick Moore, and Peter Smith; 2020
65
Proxy

Richard Westenberger, Brian Lynch, Patrick Moore, and Peter Smith. To calculate Compensation Actually Paid to our Non-CEO NEOs for each of the years
shown, the following amounts were deducted from and added to Summary Compensation Table total compensation.
Average Non-PEO NEOs Summary Compensation Table Total to
Compensation Actually Paid Reconciliation*
Year
Summary Compensation Table
Total
Deductions
from Summary Compensation
Table
Total(i)
Equity
Award
Adjustments(ii)
Compensation
Actually Paid
2024
$2,242,388
$(1,680,057)
$24,259
$586,590
2023
3,061,079
(1,662,929)
1,226,317
2,624,467
2022
2,264,230
(1,313,039)
667,866
1,619,056
2021
3,801,288
(1,987,866)
2,436,014
4,249,437
2020
1,648,590
(887,992)
(180,899)
579,698
*
Amounts in rows may not add exactly to the total due to rounding.
(i)
Represents the grant date fair value of equity-based awards granted each year, as shown in the Stock Awards column of the Summary Compensation
Table.
(ii)
Reflects the value of equity-based awards calculated in accordance with the SEC methodology for determining CAP for each year shown under
generally accepted accounting principles. The fair value of our performance-based restricted stock is calculated based on the probable outcome of the
performance conditions determined as of the last day of the fiscal year and our closing stock price on such day. The determination of equity award
adjustments to SCT total compensation is detailed in the supplemental table below.
Average Non-PEO NEOs Equity Component of Compensation Actually Paid
Year
Fair Value of
Equity Awards
Granted in the
Year and
Outstanding
and Unvested
as of Year End
Year over Year
Change in Fair
Value of
Equity Awards
Granted in
Prior Years
and
Outstanding
and Unvested
as of Year End
Fair Value as
of Vesting
Date of
Equity
Awards
Granted and
Vested in
the Year
Year over Year
Change in Fair
Value of
Equity Awards
Granted in
Prior Years
that Vested in
the Year
Fair Value at
the End of
the
Prior Year of
Equity
Awards
that were
Forfeited in
the Year
Value of
Dividends or
other
Earnings Paid
on Equity
Awards not
Otherwise
Reflected in
Fair Value or
Total
Compensation
Total
Equity
Award
Adjustments
2024
1,140,756
(919,949)

124,924
(321,472)

24,259
2023
1,476,966
(269,558)

18,909


1,226,317
2022
994,495
(272,340)

(54,289)


667,866
2021
2,052,134
372,284

11,596


2,436,014
2020
378,538
(487,886)

(71,551)


(180,899)
)
The amounts in the column 
Total Shareholder Return (column (f)) are calculated by dividing the sum of the cumulative amount of dividends for the
measurement period, assuming reinvestment of all dividends, if any, and the difference between the Companys share price at the end and the beginning
of the measurement period by the Companys share price at the beginning of the measurement period.
(4)
Represents the weighted peer group Total Shareholder Return, weighted according to the respective companies stock market capitalization at the
beginning of each period for which a return is indicated. The peer group used for this purpose is the S&P Composite 1500 Apparel, Accessories & Luxury
Goods.
(5)
The dollar amounts reported represent the amount of net income reflected in the Companys audited financial statements for the applicable year.
(6)
Management defines and calculates Adjusted Operating Income as Operating Income as calculated under generally accepted accounting principles,
excluding infrequent or extraordinary items. Adjusted Operating Income is a non-GAAP measure. A reconciliation of Operating Income to Adjusted
Operating Income can be found in the Appendix to this Proxy Statement.
PAY VERSUS PERFORMANCE LIST OF IMPORTANT FINANCIAL MEASURES
The list below consists of our most important performance measures used to link 
Compensation
Actually Paid to our NEOs for our performance, over the fiscal year ending December 28, 2024. These
measures are used to determine annual incentive payouts and are also key metrics under our
performance-based restricted stock awards. The performance measures included in this list are not
ranked by relative importance:
 Net Sales
 Adjusted Operating Income
 Adjusted Diluted EPS
 Operating Cash Flow
66

Net Sales and Operating Cash Flow are calculated in accordance with generally accepted accounting
principles. As noted above, management defines and calculates Adjusted Operating Income as Operating
Income as calculated under generally accepted accounting principles, excluding infrequent or
extraordinary items, and management defines Adjusted Diluted EPS as Diluted EPS as calculated under
generally accepted accounting principles, excluding infrequent or extraordinary items.
PAY VERSUS PERFORMANCE DESCRIPTIVE DISCLOSURE
Actual compensation paid ultimately depends on 1) the ability to meet the specific Company targets (net
sales, adjusted operating income, adjusted diluted EPS, and operating cash flow) and/or the progress in
meeting the specific Company targets and 2) the performance of the Companys stock price.
The following graph summarizes the relationship between Total Shareholder Return (
TSR) and
executive compensation actually paid to the CEO and the Non-CEO NEOs and the relationship between
the TSR of the Company and its peer group over the last four completed years:
Total Shareholder Return
($100 invested on 1/1/2020)
Actual Pay (thousands)
PEO Actual Pay
NEO Average Actual Pay
TSR
Peer Group TSR
2020
2021
2022
2023
2024
60
80
100
120

2,500
5,000
7,500
10,000
12,500
15,000
The following graph summarizes the relationship between the adjusted operating income and net
income performance measures included in the table and the executive compensation actually paid to
the CEO and the Non-CEO NEOs over the last four completed years:
67
Proxy

Financial Performance (thousands)
Actual Pay (thousands)
PEO Actual Pay
NEO Average Actual Pay
Net Income
Adjusted Operating Income
2020
2021
2022
2023
2024

100,000
200,000
300,000
400,000
500,000
600,000

2,500
5,000
7,500
10,000
12,500
15,000
68

TRANSACTIONS WITH RELATED PERSONS, PROMOTERS, AND
CERTAIN CONTROL PERSONS
The Company has a written policy that requires all transactions with related persons required to
be disclosed under Item 404(a) of Regulation S-K, promulgated under the Exchange Act, to be
reviewed by our Chief Financial Officer and General Counsel (or their designees) with our Audit
Committee and approved by our Audit Committee. There were no such transactions during fiscal
2024.
The Company considers the following to be related parties: any director or executive officer of the
Company; any nominee for election as a director; any security holder who is known to the Company to
own more than five percent of any class of the Companys voting securities; and any member of the
immediate family of any of the parties listed above including such partys spouse, parents, children,
siblings, mothers and fathers-in-law, sons and daughters-in-law, and brothers and sisters-in-law.
69
Proxy

SECURITIES OWNERSHIP OF CERTAIN BENEFICIAL OWNERS,
DIRECTORS, AND EXECUTIVE OFFICERS
The following table sets forth the number of shares of Carters common stock owned by each of the
following parties as of the record date of March 20, 2025, or as of such other date as indicated: (a) each
person known by Carters to own beneficially more than five percent of the outstanding common stock;
(b) our NEOs; (c) each director; and (d) all directors and executive officers as a group. Unless otherwise
indicated below, the holders address is 3438 Peachtree Road NE, Suite 1800, Atlanta, Georgia 30326.
Name of Beneficial Owner
Shares
Percent
BlackRock, Inc. (1)
4,442,539
12.3%
The Vanguard Group, Inc. (2)
3,652,00
1
6
0.1%
JPMorgan Chase & Co. (3)
2,838,591
7.8%
First Trust Portfolios L.P. (4)
1,952,19
5
4
.4%
Michael D. Casey (5)
529,859
1.5%
Kendra D. Krugman (5)
100,861
*
Brian J. Lynch (5)
16,880
*
Douglas C. Palladini (6)
*
*
Allison M. Peterson (5)
55,280
*
Raghu R. Sagi (5)
29,844
*
Richard F. Westenberger (5)
162,157
*
Rochester Anderson, Jr. (7)
8,628
*
Jeffrey H. Black (7)
8,628
*
Hali Borenstein
12,519
*
Luis Borgen
8,996
*
Jevin S. Eagle
18,241
*
Mark P. Hipp
12,509
*
William J. Montgoris
45,203
*
Stacey S. Rauch (7)
8,628
*
Gretchen W. Schar
13,066
*
Stephanie P. Stahl (7)
8,628
*
All directors, including nominees, and current executive officers as a
group (20 persons) (5)
733,405
2.0%
*
Indicates less than 1% of our common stock.
(1)
This information is based on Schedule 13G, filed with the SEC on January 8, 2025. BlackRock, Inc. has sole voting power covering
4,358,831 shares and sole dispositive power covering 4,442,539 shares of our common stock. The address for BlackRock, Inc. is 50
Hudson Yards, New York, NY 10001.
(2)
This information is based on Schedule 13G/A filed with the SEC on June 10, 2024. The Vanguard Group, Inc. has sole dispositive
power covering 3,597,707 shares of our common stock, shared voting power covering 12,591 shares of our common stock, and
shared dispositive power covering 54,299 shares of our common stock. The address for The Vanguard Group, Inc. is 100 Vanguard
Boulevard, Malvern, PA 19355.
(3)
This information is based on Schedule 13G/A, filed with the SEC on February 11, 2025. JPMorgan Chase & Co. has sole voting power
covering 2,762,903 shares and sole dispositive power covering 2,838,327 shares of our common stock. The address for JPMorgan
Chase & Co. is 383 Madison Avenue, New York, NY 10179.
(4)
This information is based on a joint Schedule 13G, filed with the SEC on January 31, 2025. First Trust Portfolios L.P. has shared
dispositive power covering 5,211 shares of our common stock. First Trust Advisors L.P. has shared voting power covering 1,964,195
shares and shared dispositive power covering 1,952,194 shares of our common stock. The Charger Corporation has shared voting
power covering 1,964,195 shares and shared dispositive power covering 1,952,194 shares of our common stock. The address for First
Trust Portfolios L.P., First Trust Advisors L.P., and The Charger Corporation is 120 East Liberty Drive, Suite 400, Wheaton, Illinois 60187.
70

(5)
This amount includes the (a) number of shares subject to exercisable stock options, including stock options that will become
exercisable during the 60 days after March 20, 2025, and (b) shares of unvested restricted stock and unvested performance-based
restricted stock. See the detail for each NEO and all current executive officers as a group below.
Name
Owned &
Vested
Common
Stock
Exercisable Stock
Options
Restricted
Common
Stock
Unvested
Performance-
Based Restricted
Stock
Richard F. Westenberger
70,130
17,268
55,139
19,620
Kendra D. Krugman
24,684
13,028
48,593
14,556
Allison M. Peterson


55,280

Raghu R. Sagi


29,844

Michael D. Casey
283,547
162,768

83,544
Brian J. Lynch



16,880
All current executive officers as a group
378,361
193,064
188,856
134,600
(6)
After the record date, on April 3, 2025, Mr. Palladini received a $7,000,000 sign-on equity grant, with 50% of the grant in the form
of time-based restricted stock and 50% in the form of performance-based restricted stock. For additional information, see the
section 
Compensation Discussion and Analysis - Appointment of Chief Executive Officer & President.
(7)
Each of Messrs. Anderson and Black and Mses. Rauch and Stahl (who each hold 1,975 shares of restricted stock) are the only
independent directors who hold restricted stock.
71
Proxy

DELINQUENT SECTION 16 REPORTS
Section 16(a) of the Securities Exchange Act requires that the Companys executive officers and directors,
and persons who beneficially own more than ten percent (10%) of the Companys common stock, file
initial reports of ownership and changes in ownership with the SEC. Based on a review of the copies of
such forms furnished to the Company with respect to fiscal 2024, the Company believes that all forms
were filed in a timely manner during fiscal 2024, with the exception of one (1) Form 4 filed on March 22,
2024 reporting the sales of shares by Mark P. Hipp on March 6, 2024.
72

PROPOSAL NUMBER TWO
ADVISORY VOTE ON APPROVAL OF EXECUTIVE
COMPENSATION
The Compensation Discussion and Analysis section of this proxy statement beginning on page 34
describes Carters executive compensation program and the compensation decisions that the
Compensation and Human Capital Committee and Board of Directors made in fiscal 2024 with
respect to the compensation of Carters NEOs.
Carter's is committed to achieving long-term, sustainable growth and increasing shareholder value.
Carters compensation program for its NEOs is designed to support these objectives and encourage
strong financial performance on an annual and long-term basis by linking a significant portion of the
NEOs total direct compensation to Carter's performance in the form of incentive compensation.
The Board of Directors is asking shareholders to cast a non-binding, advisory vote FOR the following
resolution:

RESOLVED, that the compensation paid to Carters NEOs, as disclosed in Carters Proxy
Statement for the 2025 Annual Meeting of Shareholders, including the Compensation Discussion &
Analysis, compensation tables and narrative discussion, is hereby APPROVED.
This proposal is commonly referred to as the 
say-on-pay vote and is required pursuant to Section 14A
of the Exchange Act. This vote is not intended to address any specific item of compensation, but rather
the overall compensation of our NEOs and the policies and practices described in this proxy statement.
Although the vote we are asking you to cast is non-binding, the Compensation & Human Capital
Committee and the Board value the views of our shareholders and intend to consider the outcome of
the vote when determining future compensation arrangements for our NEOs.
The Board recommends a vote FOR the
approval of compensation of Carters
NEOs as disclosed in this proxy
statement.
VOTE REQUIRED
Because this Proposal Number Two asks for a non-binding, advisory vote, there is no required vote that
would constitute approval. We value the opinions expressed by our shareholders in this advisory vote,
and our Compensation & Human Capital Committee will consider the outcome of the vote when
designing our compensation programs and making future compensation decisions for our NEOs.
Abstentions and broker non-votes, if any, will not have any impact on this advisory vote.
73
Proxy

AUDIT COMMITTEE REPORT
The Audit Committee reviews the Companys accounting, auditing, and financial reporting process on
behalf of the Board. The Audit Committees charter is available in the investor relations section of our
website at ir.carters.com. Management has the primary responsibility for establishing and maintaining
adequate internal financial controls, for preparing the financial statements, and for the public reporting
process. PricewaterhouseCoopers LLP (
PwC), the Companys independent registered public accounting
firm, is responsible for expressing opinions on the conformity of the Companys audited consolidated
financial statements with accounting principles generally accepted in the United States and on the
effectiveness of the Companys internal control over financial reporting.
In fulfilling its oversight responsibilities, the Audit Committee reviewed and discussed the Companys
audited financial statements for the year ended December 28, 2024 with management, including a
discussion of the quality of financial reporting, the reasonableness of significant judgments, and the
clarity of disclosures in the financial statements. The Audit Committee also discussed with PwC the
matters required to be discussed by Auditing Standard No. 1301, as adopted by the Public Company
Accounting Oversight Board, relating to communication with audit committees.
In addition, the Audit Committee received the written disclosures and the letter from the independent
registered public accounting firm required by the applicable requirements of the Public Company
Accounting Oversight Board regarding the independent registered public accounting firms
communications with the Audit Committee concerning independence and discussed with PwC its
independence from the Company and the Companys management.
Based on the reviews and discussions described in the preceding paragraphs, the Audit Committee
recommended to the Board that the audited financial statements of the Company be included in the
Annual Report on Form 10-K for filing with the SEC.
Submitted by the Audit Committee
Ms. Gretchen W. Schar, Chairperson
Mr. Jeffrey H. Black
Mr. Luis Borgen
Mr. Mark P. Hipp
Ms. Stacey S. Rauch
The Audit Committee Report does not constitute soliciting material and shall not be deemed to be filed or
incorporated by referen
r
ce into any other filing under the Securities Act of 1933, as amended, or the
Exchange Act, except to the extent that we specifically
f
incorporate the Audit Committee Report by
reference therei
r n.
74

PROPOSAL NUMBER THREE
RATIFICATION OF INDEPENDENT REGISTERED PUBLIC
ACCOUNTING FIRM
The Audit Committee of the Board has appointed PwC to serve as Carters independent registered public
accounting firm for fiscal 2025. The Board is submitting the appointment of PwC as Carters independent
registered public accounting firm for shareholder ratification and recommends that shareholders ratifyf
this appointment. The Board recommends that shareholders ratify this appointment at the Annual
Meeting. Shareholder ratification of the appointment of PwC is not required by law or otherwise. The
Board is submitting this matter to shareholders for ratification because the Board believes it to be a good
corporate governance practice. If the shareholders do not ratify t
f
he appointment, the Audit Committee
may reconsider whether or not to retain PwC. Even if the appointment is ratified, the Audit Committee
may appoint a different independent registered public accounting firm at any time during the year if, in
its discretion, it determines that such a change would be in Carters best interest and that of Carters
shareholders. A representative of PwC is expected to virtually attend the Annual Meeting, and he or she
will have the opportunity to make a statement and will be available to respond to appropriate questions.
For additional information regarding Carters relationship with PwC, please refer to the Audit Committee
Report above.
The Audit Committee has also adopted policies and procedures for pre-approving all non-audit work
performed by PwC. The Audit Committee has pre-approved the use, as needed, of PwC for specific
types of services that fall within categories of non-audit services, including various tax services. The
Audit Committee receives regular updates as to the fees associated with the services that are subject to
pre-approval. Services that do not fall within a pre-approved category require specific consideration
and pre-approval by the Audit Committee. All services rendered by PwC in the table below were pre-
approved by the Audit Committee.
The aggregate fees that Carter's incurred for professional services rendered by PwC for fiscal years 2024
and 2023 were as follows:
2024
2023
Audit Fees
$
2,331,100 $
2,079,000
Tax Fees
155,000

All Other Fees
2,000
4,500
Total Fees
$
2,488,100 $
2,083,500

Audit Fees for fiscal years 2024 and 2023 were for professional services rendered for the integrated
audit of the consolidated financial statements and internal control over financial reporting of
Carter's, other auditing procedures related to goodwill and intangible asset impairment testing, and
related out-of-pocket expenses.

Tax Fees for fiscal year 2024 were for tax compliance services. There were no tax fees for fiscal 2023.

All Other Fees for fiscal years 2024 and 2023 consisted of softw
f
are license fees.
75
Proxy

The Board recommends a vote FOR the ratification of the appointment of PricewaterhouseCoopers
LLP as the Companys independent registered public accounting firm
for fiscal 2025.
VOTE REQUIRED
The approval of Proposal Number Three requires the affirmative vote of a majority of the votes
properly cast at our Annual Meeting. Abstentions will not affect the outcome of this proposal. A
broker or other nominee will generally have discretionary authority to vote on this proposal because
it is considered a routine matter, and, therefore, we do not expect broker non-votes with respect to
this proposal.
76

OTHER MATTERS
As of the date of this proxy statement, we know of no business that will be presented for consideration
at the Annual Meeting, other than the items referred to above. If any other matter is properly brought
before the Annual Meeting for action by shareholders, proxies in the enclosed form returned to Carter's
will be voted in accordance with the recommendation of the Board or, in the absence of such a
recommendation, in accordance with the judgment of the proxy holder.
* * *
The following performance graph and return to shareholders information shown below are provided
pursuant to Item 201(e) of Regulation S-K promulgated under the Exchange Act. The graph and
information are not deemed to be 
filed under the Exchange Act or otherwise subject to liabilities
thereunder, nor are they to be deemed to be incorporated by reference in any filing under the
Securities Act or Exchange Act unless we specifically incorporate them by reference.
77
$0
$50
$100
$150
$200
$250
COMPARISON OF 5 YEAR CUMULATIVE TOTAL RETURN*
Among Carter's, Inc., the S&P 500 Index,
the S&P MidCap 400 Index and the S&P Composite 1500 Apparel, Accessories & Luxury
Goods Index
Carter's, Inc.
S&P 500
S&P MidCap 400
S&P Composite 1500 Apparel, Accessories & Luxury Goods
*$100 invested on 12/31/19 in stock or index, including reinvestment of dividends.
Calendar year ending December 31.
Copyright© 2025 Standard & Poor's, a division of S&P Global. All rights reserved.
Proxy

QUESTIONS AND ANSWERS ABOUT THE 2025 ANNUAL
MEETING
1. WHY AM I RECEIVING THIS PROXY STATEMENT?
The Board of Directors (the 
Board) of Carters, Inc. (
we, 
us, 
our, 
Carters, or the 
Company) is
Eastern Time (the 
Annual Meeting). This proxy statement and accompanying proxy card are being
mailed on or about April 4, 2025, to shareholders of record as of March 20, 2025, the record date (the

Record Date) for the Annual Meeting.
You are receiving this proxy statement because you owned shares of Carters common stock on the
Record Date and are therefore entitled to vote at the Annual Meeting. By use of a proxy, you can vote
regardless of whether or not you attend the Annual Meeting. This proxy statement provides information
on the matters on which the Board would like you to vote so that you can make an informed decision.
2. WHAT IS THE PURPOSE OF THE ANNUAL MEETING?
The purpose of the Annual Meeting is to address the following business matters:
1.
Election of the 11 nominated directors (see page 26);
2.
Advisory approval of the compensation for our named executive officers for 2024 (
NEOs) (the 
say-
on-pay vote) (see page 73);
3.
Ratification of the appointment of PricewaterhouseCoopers LLP (
PwC) as Carters
independent registered public accounting firm for fiscal 2025 (see page 75); and
4.
All other business that may properly come before the meeting.
3. WHO IS ASKING FOR MY VOTE?
Carter's is soliciting your proxy on behalf of the Board and is paying for the costs of this solicitation and
proxy statement. Okapi Partners LLC has been retained by the Company to assist in the solicitation of
proxies for a base fee not to exceed $12,500, (with select additional campaign services to be provided if
requested at an additional fee), plus reimbursement for out-of-pocket expenses, to be borne by the
Company.
4. WHO CAN ATTEND THE ANNUAL MEETING?
All shareholders of record, or their duly appointed proxies, may attend the virtual Annual Meeting.
Beneficial holders who hold shares 
in street name may also be admitted to the virtual Annual Meeting,
provided they obtain the appropriate control number from their broker or other nominee in order to
access the virtual meeting. As of the Record Date, there were 36,237,114 shares of common stock issued
and outstanding.
In order to attend the Annual Meeting, you must register at www.proxydocs.com/CRI. Upon completing
your registration, you will receive further instructions via email, including a unique link that will allow you
access to the Annual Meeting and the ability to vote and submit questions during the Annual Meeting.
As part of the registration process, you must enter the control number located on your proxy card or
voting instruction form. If you are a beneficial owner of shares registered in the name of a broker, bank or
other nominee, you will also need to provide the registered name on your account and the name of your
broker, bank or other nominee as part of the registration process.
On the day of the Annual Meeting
, shareholders may begin to login to the virtual Annual
Meeting fifteen minutes prior to the meeting, which will begin promptly at 1:00 p.m. Eastern Time.
78
soliciting proxies for our virtual 2025 Annual Meeting of Shareholders on May 14, 2025, at 1:00 p.m.


	

5. HOW WILL THE VIRTUAL MEETING WORK?
We have designed the format of the Annual Meeting to provide our shareholders with the same rights
and opportunities to participate as they would have at an in-person meeting.
During the Annual Meeting, we will hold a question and answer session during which we intend to
answer questions submitted during the meeting that are pertinent to Carter's, as time permits, and in
accordance with our Rules and Procedures for Conduct of the Annual Meeting. On the day of and during
the Annual Meeting, you can view our Rules and Procedures for Conduct of the Annual Meeting and
submit any questions on the virtual meeting platform by using your unique link included in the email
that you will receive one hour prior to the start of the Annual Meeting. Answers to any questions not
addressed during the meeting will be posted following the meeting on the Investor Relations page of
our website at ir.carters.com. Questions and answers will be grouped by topic, and substantially similar
questions will be answered only once. To promote fairness, efficiently use Carters resources, and
ensure all shareholder questions are able to be addressed, we will respond to no more than three
questions from any single shareholder.
Prior to and during the Annual Meeting, we will have support available to assist shareholders with any
technical difficulties they may have accessing or hearing the virtual meeting. The technical support
telephone number will be included in the access email you will receive one hour prior to the start of the
Annual Meeting.
6. WHAT ARE MY VOTING RIGHTS?
Each share of common stock is entitled to one vote on each matter submitted to shareholders at the
Annual Meeting.
7. WHAT IS THE DIFFERENCE BETWEEN HOLDING SHARES AS A SHAREHOLDER OF RECORD AND AS A
BENEFICIAL OWNER 
IN STREET NAME?
If your shares are registered directly in your name with the Companys transfer agent, Equiniti Trust
Company, you are considered the shareholder of record for these shares. As the shareholder of record,
you have the right to grant your voting proxy directly to the person(s) listed on your proxy card or vote in
person (virtually) at the Annual Meeting.
If your shares are held in a brokerage account or through another nominee, such as a trustee, you are
considered the beneficial owner of shares held 
in street name. These proxy materials are being
forwarded to you together with a voting instruction card. As a beneficial owner, you have the right to
direct your broker or other nominee how to vote, and you are also invited to attend the Annual Meeting.
Because you are a beneficial owner and not the shareholder of record, you may not vote your shares in
person (virtually) at the Annual Meeting unless you obtain a proxy from the broker or other nominee
that holds your shares. Your broker or other nominee should have provided directions for you to instruct
the broker or nominee on how to vote your shares.
8. WHAT IS A BROKER NON-VOTE?
If you are a beneficial owner whose shares are held 
in street name and you do not provide voting
instructions to your broker, your shares will not be voted on any proposal as to which the broker does
not have discretionary authority to vote. This is called a 
broker non-vote. Your broker only has
discretionary authority to vote on Proposal Number Three. Therefore, your broker will not have
discretion to vote on any other proposal unless you specifically instruct your broker how to vote your
shares by returning your completed and signed voting instruction card.
79
Proxy

9. WHAT CONSTITUTES A QUORUM?
A quorum is the minimum number of shares required to be present to transact business at the Annual
Meeting. Pursuant to Carters Bylaws, the presence at the Annual Meeting, in person (not available at
this virtual Annual Meeting), by proxy, or by remote communication of the holders of at least a majority
of the shares issued and outstanding and entitled to vote at the Annual Meeting will constitute a
quorum. Broker non-votes and abstentions will be counted as shares that are present at the meeting
for purposes of determining a quorum. If a quorum is not present, the meeting will be adjourned until a
quorum is obtained.
10. WHAT ARE MY CHOICES WHEN CASTING A VOTE WITH RESPECT TO THE ELECTION OF THE
ELEVEN NOMINATED DIRECTORS, AND WHAT VOTE IS NEEDED TO ELECT THE DIRECTOR
NOMINEES?
In voting on the election of the director nominees (
Proposal Number One), shareholders may:
1.
vote for any of the nominees;
2.
vote against any of the nominees; or
3.
abstain from voting on any of the nominees.
Pursuant to our Bylaws, a nominee will be elected if the number of votes properly cast 
for such
director nominee exceed the number of votes cast 
against that nominee. Any nominee not receiving
such majority, who is then serving as a director, must tender his or her resignation for consideration by
the Board. Any nominee appointed to the Board, subject to shareholder approval, will not have been
elected as a director at the Annual Meeting. Abstentions and broker non-votes will not have any impact
on the outcome of this vote.
11. WHAT ARE MY CHOICES WHEN CASTING AN ADVISORY VOTE ON APPROVAL OF
COMPENSATION OF CARTERS NEOS, COMMONLY REFERRED TO AS THE 
SAY-ON-PAY VOTE,
AND WHAT VOTE IS NEEDED TO APPROVE THIS PROPOSAL?
In voting on the compensation of Carters NEOs (
Proposal Number Two), shareholders may:
1.
vote for the approval of compensation of Carters NEOs, on an advisory basis, as described in this
proxy statement;
2.
vote against the approval of compensation of Carters NEOs, on an advisory basis, as described in
this proxy statement; or
3.
abstain from voting on compensation of Carters NEOs, on an advisory basis, as described in this
proxy statement.
Because Proposal Number Two asks for a non-binding, advisory vote, there is no required vote that
would constitute approval. We value the opinions expressed by our shareholders in this advisory vote,
and our Compensation & Human Capital Committee will consider the outcome of the vote when
evaluating our compensation programs and making future compensation decisions for our NEOs.
Abstentions and broker non-votes, if any, will not have any effect on this advisory vote.
12. WHAT ARE MY CHOICES WHEN VOTING ON THE RATIFICATION OF THE APPOINTMENT OF
PWC AS THE COMPANYS INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM FOR FISCAL
2025, AND WHAT VOTE IS NEEDED TO APPROVE THIS PROPOSAL?
In voting on the ratification of PwC (
Proposal Number Three), shareholders may:
1.
vote to ratify PwCs appointment;
2.
vote against ratifying PwCs appointment; or
3.
abstain from voting on ratifying PwCs appointment.
80

The approval of Proposal Number Three requires the affirmative vote of a majority of the votes
properly cast at our Annual Meeting. Abstentions are not considered votes cast and thus will not
affect the outcome of this proposal. A broker or other nominee will generally have discretionary
authority to vote on this proposal because it is considered a routine matter, and, therefore, we do not
expect broker non-votes with respect to this proposal.
13. HOW DOES THE BOARD RECOMMEND THAT I VOTE?
The Board recommends a vote:
FOR the election of the 11 nominated directors (Proposal Number One);
FOR the approval of the compensation of Carters NEOs, on an advisory basis, as described in this proxy
statement (Proposal Number Two); and
FOR the ratification of the appointment of PwC (Proposal Number Three).
14. HOW DO I VOTE?
You may hold Company shares in multiple accounts and therefore receive more than one set of the
proxy materials. To ensure that all of your shares are voted, please submit your proxy or voting
instructions for each account for which you have received a set of the proxy materials.
Shares Held of Record. If you hold your shares in your own name as a holder of record with our transfer
agent, Equiniti Trust Company, you may authorize that your shares be voted at the Annual Meeting in
one of the following ways:
By Internet
If you received a printed copy of the proxy materials, follow the instructions on
the proxy card.
By Telephone
If you received a printed copy of the proxy materials, follow the instructions on
the proxy card.
By Mail
If you received a printed copy of the proxy materials, complete, sign, date, and
mail your proxy card in the enclosed, postage-prepaid envelope.
In Person (Virtual)
You may also vote by attending the meeting virtually through
www.proxydocs.com/CRI. To attend the Annual Meeting and vote your shares,
you must register for the Annual Meeting and provide the control number
located on your proxy card.
Shares Held in Street
r
Name. If you hold your shares through a broker, bank or other nominee (that is, in
street name), you will receive instructions from your broker, bank or nominee that you must follow in
order to submit your voting instructions and have your shares voted at the Annual Meeting. If you want
to vote in person (virtually), you must register in advance at www.proxydocs.com/CRI. You may be
instructed to obtain a legal proxy from your broker, bank or other nominee and to submit a copy in
advance of the meeting. Further instructions will be provided to you as part of your registration process.
Even if you plan to attend the Annual Meeting, we recommend that you submit your proxy or
voting instructions in advance of the meeting as described above so that your vote will be
counted if you later decide not to attend or are unable to attend.
81
Proxy

15. CAN I CHANGE MY VOTE AFTER I RETURN MY PROXY CARD?
Yes. If you are a shareholder of record, you may revoke your proxy at any time before it is exercised in any
of the following three methods:
 by submitting written notice of revocation to Mr. Robinson at Carters address set forth in the 2025
Notice of Annual Meeting;
 by submitting another proxy by telephone, over the Internet, or by mail that is later dated and, if by
mail, that is properly signed; or
 by voting at the virtual Annual Meeting.
If you hold your shares through a broker or other nominee and would like to change your voting
instructions, please review the directions provided to you by that broker or nominee.
16. MAY I VOTE CONFIDENTIALLY?
Yes. Our policy is to keep your individual votes confidential, except as appropriate to meet legal
requirements, to allow for the tabulation and certification of votes, or to facilitate proxy solicitation.
17. WHO WILL COUNT THE VOTES?
A representative of Mediant, Inc. will count the votes and act as the inspector of election for the Annual
Meeting.
18. WHAT HAPPENS IF ADDITIONAL MATTERS ARE PRESENTED AT THE ANNUAL MEETING?
As of the date of this proxy statement, the Board knows of no matters other than those set forth herein
that will be presented for determination at the Annual Meeting. If, however, any other matters properly
come before the Annual Meeting and call for a vote of shareholders, the Board intends proxies to be voted
in accordance with the judgment of the proxy holders.
19. WHERE CAN I FIND THE VOTING RESULTS OF THE ANNUAL MEETING?
We intend to announce preliminary voting results at the Annual Meeting and publish final results in our
current report on Form 8-K within four business days after the Annual Meeting.
20. WHAT IS 
HOUSEHOLDING OF THE ANNUAL MEETING MATERIALS?
The SEC has adopted rules that permit companies and intermediaries, such as brokers, to satisfy
delivery requirements for proxy statements with respect to two or more shareholders sharing the same
address, by delivering a single proxy statement to those shareholders. This process, which is commonly
referred to as 
householding, potentially provides extra convenience for shareholders and cost savings
for companies. Carter's and some brokers 
household proxy materials, delivering a single proxy
statement and annual report to multiple shareholders sharing an address unless contrary instructions
have been received from the affected shareholders. If, at any time, you no longer wish to participate in
householding and would prefer to receive a separate proxy statement and annual report, or if you are
receiving multiple copies of the proxy statement and annual report and wish to receive only one, please
notify your broker if your shares are held in a brokerage account, or Carter's if you hold shares registered
directly in your name. You can notify Carter's by sending a written request to Mr. Robinson at Carters
address set forth in the 2025 Notice of Annual Meeting or by calling us at (678) 791-1000.
21. HOW MAY I OBTAIN A COPY OF CARTERS ANNUAL REPORT?
A copy of our fiscal 2024 Annual Report on Form 10-K (the 
Annual Report) accompanies this
proxy statement and is available at https://ir.carters.com/financial-information/annual-reports.
Shareholders may also obtain a free copy of our Annual Report by sending a request in writing to
Mr. Robinson at Carters address at 3438 Peachtree Road NE, Suite 1800, Atlanta, Georgia 30326,
or by calling us at (678) 791-1000.
82

22. HOW DO I SUBMIT A PROPOSAL OR NOMINATE A DIRECTOR CANDIDATE FOR THE 2026
ANNUAL MEETING?
Any shareholder proposals or director nominations must be submitted in writing to our Secretary c/o
Carter's, Inc., 3438 Peachtree Road NE, Atlanta, Georgia 30326. Additional details for those submissions
are as follows.
Shareholder Proposals
This section relates to shareholder proposals for the 2026 Annual Meeting other than director
nominations. If you wish to nominate a director candidate, please see the section that follows under the
heading 
Nomination of Director Candidates. The deadlines and requirements for submitting a
shareholder proposal depend on whether the shareholder seeks to have the proposal included in the 2026
Proxy Statement using Rule 14a-8 under the Exchange Act:

Proposals of Business Not Using Rule 14a-8: Under our Bylaws, if a shareholder wants to
propose an item of business to be considered at the 2026 Annual Meeting, the shareholder must
give advance written notice to our Secretary, which must be received no earlier than the close of
business on January 14, 2026, and no later than the close of business on February 13, 2026. If,
however, our 2026 Annual Meeting is held more than 30 days before or after May 14, 2026 (the
one-year anniversary of our 2025 Annual Meeting), the notice must be received no earlier than
the close of business on the 120th day before such annual meeting and no later than the close of
business on the later of (1) the 90th day before such annual meeting or (2) the tenth day
following the date on which the public announcement of the date of such meeting is first made
by Carter's. The advance written notice must comply with all applicable statutes and regulations,
as well as certain other provisions contained in our Bylaws, which generally require the
shareholder to provide a brief description of the proposed business, reasons for proposing the
business, and certain information about the shareholder and Carter's securities held by the
shareholder.

Proposals of Business Using Rule 14a-8: A shareholder who wants to propose an item of
business to be included in our 2026 Proxy Statement using Rule 14a-8 must follow the
procedures provided in Rule 14a-8. In addition, the proposal must be received by our Secretary
by December 3, 2025.
Nomination of Director Candidates
This section relates to nomination of director candidates. The deadlines and requirements for director
candidates recommended for consideration or nominated by a shareholder are as follows:

Recommending a Candidate for Nominating & Corporate Governance Committee
Consideration: Any shareholder who wishes to recommend a candidate for our Nominating &
Corporate Governance committee to consider nominating as a director at the 2026 Annual
Meeting should submit a written request and related information to our Secretary no later than
December 31, 2025, in order to allow for sufficient time to consider the recommendation.

Directly Nominating a Director Candidate Under our Bylaws: Under our Bylaws, if a
shareholder plans to directly nominate a person as a director at the 2026 Annual Meeting, the
shareholder must give advance written notice of the director nomination to our Secretary, which
must be received no earlier than the close of business on January 14, 2026, and no later than the
close of business on February 13, 2026. If, however, our 2026 Annual Meeting is held more than 30
83
Proxy

days before or afte
f
r May 14, 2026 (the one-year anniversary of our 2025 Annual Meeting), the
notice must be received no earlier than the close of business on the 120th day before such annual
meeting and no later than the close of business on the later of (1) the 90th day before such
annual meeting or (2) the tenth day following the date on which the public announcement of the
date of such meeting is first made by Carter's. The notice must comply with all applicable
statutes and regulations, as well as certain other provisions contained in our Bylaws, which
generally require the shareholder to provide certain information about the proposed nominee,
the shareholder, and Carter's securities held by the shareholder, the nominee, and associated
persons. In addition to satisfying those advance notice and other requirements in our Bylaws
within the window set forth above, any shareholder who intends to solicit proxies in support of
director nominees other than the Boards nominees must comply with the Universal Proxy Rules
set forth in Rule 14a-19 under the Exchange Act.
23. WHAT DO YOU MEAN BY FISCAL YEARS IN THIS PROXY STATEMENT?
Our fiscal year ends on the Saturday, in December or January, nearest the last day of December, resulting
in an additional week of results every five or six years. Fiscal 2024 (which ended on December 28, 2024),
Fiscal 2023 (which ended on December 30, 2023), Fiscal 2022 (which ended on December 31, 2022), and
Fiscal 2021 (which ended on January 1, 2022) contained 52 weeks. Fiscal 2025 (which will end on
December 27, 2025) contains 53 weeks.
24. WHO CAN HELP ANSWER MY QUESTIONS?
If you have any questions about the Annual Meeting or how to submit or revoke your proxy, or to
request an invitation to the Annual Meeting (which is being held virtually), contact Mr. Robinson at
Carters address set forth in the 2025 Notice of Annual Meeting or by calling us at (678) 791-1000.
84

APPENDIX
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES TO GAAP MEASURES
We have provided non-GAAP adjusted operating income and diluted net income per common share measures, which exclude certain
items presented below. We believe that this information provides a meaningful comparison of our results and affords investors a view of
what management considers to be our core performance, and we also, from time to time, use some of these non-GAAP measures, such
as adjusted operating income, as performance metrics in awards under our annual and long-term incentive compensation plans. These
measures are not in accordance with, or an alternative to, generally accepted accounting principles in the U.S. (GAAP). The most
comparable GAAP measures are operating income and diluted net income per common share, respectively. Adjusted operating income
and diluted net income per common share should not be considered in isolation or as a substitute for analysis of our results as reported
in accordance with GAAP. Other companies may calculate adjusted operating income and diluted net income per common share
differently than we do, limiting the usefulness of the measure for comparisons with other companies.
Fiscal Year Ended
December 28, 2024
December 30, 2023
December 31, 2022
January 1, 2022
January 2 2021 (*)
(In millions,
except earnings
per share)
Operating
Income
Diluted
Net
Income per
Common
Share
Operating
Income
Diluted
Net
Income
per
Common
Share
Operating
Income
Diluted
Net
Income
per
Common
Share
Operating
Income
Diluted
Net
Income
per
Common
Share
Operating
Income
Diluted
Net
Income
per
Common
Share
As reported
(GAAP)
$
254.7 $
5.12
$
323.4 $
6.24
$
379.2
$
6.34
$
497.1
$
7.81
$
189.9
$
2.50
Organizational
restructuring (1)
1.8
0.04
4.4
0.09


2.4
0.04
16.6
0.29
Intangible asset
impairment (2)
30.0
0.63


9.0
0.17


26.5
0.46
Partial pension
plan settlement
(3)

0.02








Legal
settlement (4)



(0.14)






Loss on
extinguishment
of debt (5)





0.38




COVID-19
expenses (5)






3.9
0.07
21.4
0.37
Retail store
operating
leases and
other long-lived
asset
impairments,
net (7)






(2.6)
(0.05)
7.6
0.13
Goodwill
impairment (8)








17.7
0.40
As adjusted
$
286.6 $
5.81
$
327.8 $
6.19
$
388.2
$
6.90
$
500.8
$
7.87
$
279.8
$
4.16
(*)
Fiscal year 2020 included 53 weeks, compared to 52 weeks in fiscal 2024, 2023, 2022, and 2021.
85
Proxy

(1)
Related to charges for organizational restructuring in fiscal 2024. Fiscal 2023 relates to charges for organizational restructuring and related corporate
office lease amendment actions. Fiscal 2021 and 2020 amounts relate to certain lease exit, severance and related costs resulting from restructuring
actions (not related to COVID-19).
(2)
Related to a non-cash impairment charge on the OshKosh indefinite-lived tradename asset in fiscal 2024. Fiscal 202 write-down relates to Skip Hop
tradename asset. Fiscal 2020 write-down relates to OshKosh and Skip Hop tradename assets.
(3)
Related to a non-cash partial pension settlement charge in the fiscal in 2024.
(4)
In fiscal 2023, a pre-tax adjustment of approximately $6.9 million ($5.3 million net of tax, or $0.14 per diluted share) was made related to a gain on a
court-approved settlement in December 2023.
(5)
In fiscal 2022, a pre-tax adjustment of approximately $19.9 million ($15.2 million net of tax, or $0.38 per diluted share) was made related to a loss on
extinguishment of debt in fiscal 2022.
(6)
Net expenses incurred due to the COVID-19 pandemic.
(7)
Impairments include an immaterial gain on the remeasurement of retail store operating leases.
(8)
Goodwill impairment charge recorded in the International segment.
Note: Results may not be additive due to rounding.
86

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Form 10-K
Annual Reportr
Form 10-K




[THIS PAGE INTENTIONALLY LEFT BLANK] 

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
(Mark One)
☒ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the Fiscal Year Ended December 28, 2024
or
☐TRANS
R
ITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from ______to ______
Commission file number: 001-31829
CARTER
S, INC.
(Exact name of registrant as specified in its charter)
Delaware
13-3912933
(State or other jurisdiction of
(I.R.S. Employer Identific
f ation No.)
incorporation or organization)
Phipps Tower
3438 Peachtree Road NE, Suite 1800
Atlanta, Georgia 30326
(Address of principal executive offi
f ces, including zip code)
(678) 791-1000
(Registrant
s telephone number, including area code)
_______________________________________________
Securities registered pursuant to Section 12(b) of the Act:
Title of Each Class
Trading Symbol(s)
Name of Each Exchange on Which Registered
Common stock, par value $0.01 per share
CRI
New York Stock Exchange
Securities registered pursuant to section 12(g) of the Act: None
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities
Act. Yes ☒
No ☐
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the
Act. Yes ☐
No ☒
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of
the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant
was required to file such reports), and (2) has been subj
u ect to such filing requirements for the past 90 days. Yes ☒
No ☐
Indicate by check mark whether the registrant has subm
u
itted electronically every
r Interactive Data File required to be
subm
u
itted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for
such shorter period that the registrant was required to subm
u
it such files). Yes ☒
No ☐
Form 10-K

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer,
a smaller reporting company, or an emerging growth company. See the definitions of large accelerated filer,
accelerated filer, smaller reporting company, and emerging growth company in Rule 12b-2 of the Exchange
Act.
Large Accelerated Filer ☒Accelerated Filer ☐
Non-Accelerated Filer ☐Smaller Reporting Company ☐
Emerging Growth Company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended
transition period for complying with any new or revised financial accounting standards provided pursuant to Section
13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant has 
led a report on and attestation to its management
s assessment of
the effe
f ctiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15
U.S.C. 7262(b)) by the registered public accounting 
rm that prepared or issued its audit report. ☒
If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial
statements of the registrant included in the filing reflect the correction of an error to previously issued financial
statements. ☐
Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of
incentive-based compensation received by any of the registrant
s executive offi
f cers during the relevant recovery
period pursuant to §240.10D-1(b). ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ☐
No
☒
The approximate aggregate market value of the voting stock held by non-affi
f liates of the registrant as of the last
business day of the registrant
s most recently completed second fiscal quarter, based upon the closing sale price of
the registrant
s common stock on June 29, 2024 as reported on the New York Stock Exchange was $2,173,597,502.
For purpos
r
es of the foregoing calculation only, which is required by Form 10-K, the registrant has included in the
shares owned by affi
f liates those shares owned by directors and executive offi
f cers of the registrant, and such
inclusion shall not be construe
r
d as an admission that any such person is an affi
f liate for any purpos
r
e.
As of Febru
r ary
r 18, 2025, there were 36,010,750 shares of the registrant
s common stock outstanding.
DOCUMENTS INCORPORAT
R
ED BY REFERENCE
Portions of the definitive proxy statement to be filed with the Securities and Exchange Commission pursuant to
Regulation 14A relating to the Annual Meeting of shareholders of Carter
s, Inc., expected to be held on May 14,
2025, will be incorporated by reference in Part III of this Form 10-K. Carter
s, Inc. intends to file such proxy
statement with the Securities and Exchange Commission not later than 120 days afte
f r its fiscal year ended
December 28, 2024.

CARTER
S, INC.
INDEX TO ANNUAL REPORT ON FORM 10-K
FISCAL YEAR ENDED DECEMBER 28, 2024
Page
Part I
1
Item 1
Business
3
Item 1A
Risk Factors
12
Item 1B
Unresolved Stafff Comments
28
Item 1C
Cybersecurity
28
Item 2
Properties
30
Item 3
Legal Proceedings
30
Item 4
Mine Safety Disclosures
30
Part II
31
Item 5
Market for Registrant
s Common Equity, Related Stockholder Matters, and Issuer
Purchases of Equity Securities
31
Item 6
[Reserved]
32
Item 7
Management
s Discussion and Analysis of Financial Condition and Results of
Operations
33
Item 7A
Quantitative and Qualitative Disclosures about Market Risk
48
Item 8
Financial Statements and Suppl
u
ementary Data
50
Item 9
Changes in and Disagreements with Accountants on Accounting and Financial
Disclosure
93
Item 9A
Controls and Procedur
d
es
93
Item 9B
Other Information
93
Item 9C
Disclosure Regarding Foreign Jurisdictions that Prevent Inspections
94
Part III
95
Item 10
Directors and Executive Offi
f cers of the Registrant
95
Item 11
Executive Compensation
95
Item 12
Security Ownership of Certain Beneficial Owners and Management and Related
Stockholder Matters
95
Item 13
Certain Relationships and Related Transactions
95
Item 14
Principal Accountant Fees and Services
95
Part IV
96
Item 15
Exhibits and Financial Statement Schedules
96
Item 16
Form 10-K Summary
r
101
SIGNATURES
102
Form 10-K

[THIS PAGE INTENTIONALLY LEFT BLANK]

Statements contained in this annual report that are not historical fact and use predictive words such as estimates, outlook,
guidance, expect, believe, intend, designed, target, plans, may, will, are confid
f ent and similar words are
forward-looking statements (as such term is defined in the Private Securities Litigation Reform Act of 1995). These forward-
looking statements and related assumptions involve risks and uncertainties that could cause actua
t
l results and outcomes to differ
materially from any forward-looking statements or views expressed in this press release. These risks and uncertainties include,
but are not limited to, those discussed in the subs
u
ection entitled Risk Factors under Part I, Item 1A, of this Annual Report on
10-K, and otherwise in our reports and filings with the Securities and Exchange Commission, as well as the following factors:
changes in global economic and financial conditions, and the resulting impact on consumer confid
f ence and consumer spending,
as well as other changes in consumer discretionary spending habi
a ts; risks related to public health crises; risks related to
consumer tastes and prefer
f ences, as well as fashion trends; the failure to protect our intellectua
t
l property; the diminished value
of our brands, potentially as a result of negative publicity or unsuccessful
f
branding and marketing effo
f
rts; delays, product
recalls, or loss of revenue due to a failure to meet our quality standards; risks related to uncertainty regarding the future of
international trade agreements; increased competition in the marketpl
t ace; financial difficulties for one or more of our majo
a r
customers; identification of locations and negotiation of appropriate lease terms for our retail stores; distinct risks facing our
eCommerce business; failure to forecast demand for our products and our failure to manage our inventory;
r
increased margin
pressures, including increased cost of materials and labor
a
and our inability to successful
f ly increase prices to offs
f et these
increased costs; continued inflationary pressures with respect to labor
a
and raw materials and global suppl
u
y chain constraints that
have, and could continue, to affe
f ct freight, transit, and other costs; fluctuations in foreign currency exchange rates;
unseasonabl
a e or extreme weather conditions; risks associated with corporate responsibility issues; our foreign sourcing
arrangements; a relatively small number of vendors suppl
u
y a significant amount of our products; disrupt
r
ions in our suppl
u
y
chain, including increased transportation and freight costs; our ability to effe
f ctively source and manage inventory;
r
problems
with our Braselton, Georgia distribution facility; pending and threatened lawsuits; a breach of our information technology
systems and the loss of personal data or a failure to implement new information technology systems successful
f ly; unsuccessful
f
expansion into international markets; failure to comply with various laws and regulations; failure to properly manage strategic
initiatives; retention of key individuals; acquisition and integration of other brands and businesses; failure to achieve sales
growth plans and profit
f ability objectives to suppor
u
t the carrying value of our intangible assets; our continued ability to meet
obligations related to our debt; changes in our tax obligations, including additional customs, duties or tariffs; our continued
ability to declare and pay a dividend; volatility in the market price of our common stock; and the cost or effo
f
rt required for our
shareholders to bring certain claims or actions against us, as a result of our designation of the Court of Chancery
r of the State of
Delaware as the sole and exclusive forum for certain types of actions and proceedings. Except for any ongoing obligations to
disclose material information as required by federal securities laws, the Company does not undertake any obligation to publicly
update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise. The
inclusion of any statement in this Annual Report on Form 10-K does not constitute an admission by the Company or any other
person that the events or circumstances described in such statement are material.
PART I
Unless the context indicates otherwise, in this filing on Form 10-K, Carter
s, the Company, we, us, its, and our
refers to Carter
s, Inc. and its wholly owned subs
u
idiaries.
Our market share data is based on information provided by Circana, LLC (formerly the NPD Group, Inc.). Circana, LLC.
(Circana) data is based upon Consumer Panel TrackSM(consumer-reported sales) calibrated with selected retailers
 point of
sale data for children
s apparel and juvenile products in the United States (U.S.) and represents the twelve-month period
ended December 2024.
Unless otherwise indicated, references to market share in this Annual Report on Form 10-K are expressed as a percentage of
total retail sales of the stated market. Some Circana market share data is presented based on age segments. The baby
a
and young
children
s apparel market in which we compete includes apparel products for ages zero to 10 and is divided into the zero to
two-year-old baby
a
market, the three- to four-year-old toddler market, and the five- to 10-year-old kids market. Note that
Carter
s defines its product offe
f rings by sizes: baby
a
(sizes newborn to 24 months), toddlers (sizes 2T to 5T), and kids (sizes
4-14). In addition, other Circana market share data is presented based on Circana
s definition of the baby
a
and playclothes
categories, which is different from Carter
s definitions of these categories.
Certain Circana data cited in prior Annual Reports on Form 10-K were based on an alternate methodology no longer employed
by Circana and are not comparable to the current year presentation.
Our trademarks that are referred to in this Annual Report on Form 10-K, including Carter
s, OshKos
K
h B
gosh, OshKos
K
h, Skip
Hop
o , Child of Mine, Just One You, Simple Joys
o
, Little Planet, PurelySoftf , and Carter
s Rewards
d , many of which are registered
1
Form 10-K

in the United States and in over 100 other countries and territories, are each the property of one or more subs
u
idiaries of Carter
s,
Inc.
The Company
s fiscal year ends on the Saturday in December or January nearest December 31. Every
r five or six years, our
fiscal year includes an additional 53rd week of results. Fiscal 2024 ended on December 28, 2024, fiscal 2023 ended on
December 30, 2023, and fiscal 2022 ended on December 31, 2022. All three fiscal years contained 52 calendar weeks.
2

ITEM 1. BUSINESS
Overview
We are the largest branded marketer of young children
s apparel in North America. We own two of the most highly recognized
and trus
r
ted brand names in the children
s apparel market, Carter
s and OshKos
K
h B
gosh (or OshKos
K
h). We also own Skip
Hop
o , a leading young children
s lifestyle brand, Little Planet, a brand focused on organic fabr
a
ics and sustainabl
a e materials, and
exclusive Carter
s brands developed for Amazon, Target, and Walmart.
Establ
a ished in 1865, our Carter
s brand is recognized and trus
r
ted by consumers for high-quality apparel and accessories for
children in sizes newborn to 14.
Establ
a ished in 1895, OshKos
K
h is a well-known brand, trus
r
ted by consumers for high-quality apparel and accessories for
children in sizes newborn to 14, with a focus on playclothes for toddlers and young children. We acquired OshKos
K
h in 2005.
Establ
a ished in 2003, the Skip Hop
o brand rethinks, reenergizes, and reimagines durable necessities to create higher value,
supe
u
rior quality, and award-winning products for parents, babi
a es, and toddlers. We acquired Skip Hop
o in 2017.
Launched in 2021, the Little Planet brand focuses on sustainabl
a e clothing through the sourcing of mostly organic cotton as
certifie
f d under the Global Organic Textile Standard (GOTS), a global textile processing standard for organic fibers. This
brand includes a wide assortment of baby
a
and toddler apparel, accessories, and sleepwear.
Additionally, Childl of Mine, an exclusive Carter
s brand, is sold at Walmart, Just One You, an exclusive Carter
s brand, is sold
at Target, and Simple Joys
o
, an exclusive Carter
s brand, is availabl
a e on Amazon.
Our mission is to serve the needs of families with young children, with a vision to be the world
s favorite brands in young
children
s apparel and related products. We believe our brands are complementary
r to one another in product offe
f ring and
aesthetic. Each brand is uniquely positioned in the marketpl
t ace and offe
f rs great value to families with young children. The baby
a
and young children
s apparel market, ages zero to 10, in the U.S. is approximately $28 billion as of December 2024. In this
market, our Carter
s brands, including our exclusive brands, hold the #1 position with approximately 10% market share and our
OshKos
K
h brand has less than 1% market share as of December 2024.
Our multichannel global business model, which includes retail stores, eCommerce, and wholesale distribution channels, as well
as omni-channel capa
a
bi
a lities in the United States and Canada, enables us to reach a broad range of consumers around the world.
At the end of fiscal 2024, our channels included 1,057 company-owned retail stores in North America, eCommerce websites,
approximately 19,500 wholesale locations in North America, as well as our international wholesale accounts and licensees who
operate in over 1,100 locations outside of North America in over 90 countries.
Our three business segments are: U.S. Retail, U.S. Wholesale, and International. These segments are our operating and
reporting segments. Our U.S. Retail segment consists of revenue primarily from sales of products in the United States through
our retail stores and eCommerce websites. Similarly, our U.S. Wholesale segment consists of revenue primarily from sales in
the United States of products to our wholesale customers. Our International segment consists of revenue primarily from sales of
products outside the United States, largely through our retail stores and eCommerce websites in Canada and Mexico, and sales
to our international wholesale customers and licensees. Additional financial and geographical information about our business
segments is contained in Item 8 Financial Statements and Suppl
u
ementary Data and under Note 18, Segm
e
ent Info
n rmation, to
the consolidated financial statements.
Strategy
We have extensive experience in the young children
s apparel and accessories market and focus on delivering products that
satisfy our consumers
 needs. Our growth agenda is centered on three fundamental areas:

Elevate the styl
t e and value of our product offe
f rings  We are focused on driving growth by delivering market-leading
style and enhancing our value proposition. In fiscal 2024, informed by consumer demand and insights, we initiated a
shiftf of our U.S. Retail product assortment to increase the sales mix of the best (more premium fashion) and the
opening price point components of our apparel offe
f ring. As a result, both components represented a higher proportion
of sales in the second half of fiscal 2024 compared to the first half of fiscal 2024.
The shiftf to increase the penetration of our best product is suppor
u
ted by a house-of-b
f
rands strategy that enables us to
leverage new, more targeted and differentiated brands like Little Planet, as well as our curated collections from
PurelySoft,
f OshKos
K
h B
gosh, Skip Hop
o and Carter
s. Over time we plan to develop this strategy further as a way of
reaching more of the marketpl
t ace, including some customer segments which we do not serve today.
3
Form 10-K

Also in fiscal 2024, and enabled by our enhanced pricing capabilities, we made retail price investments to be more
competitive in select toddler and kids size playwear categories and during higher-volume market share promotional
events, and to suppor
u
t inventory
r management objectives. Areas of playwear investment included select opening price
point categories, which are less differentiated from similar private labe
a
l products in the marketpl
t ace and exhibit higher
price elasticity, and additional programs such as collections, fleece, and activewear. Collectively these effo
f
rts helped to
drive growth in the value component of our U.S. Retail assortment and contributed to an increase in conversion rates
(measured as the percentage of store visitors and website traffi
f c that resulted in a purchase) and units per transaction in
both stores and eCommerce in the second half of fiscal 2024 compared to the first half of fiscal 2024.

Impr
m
ove our market
k ing capabi
a
lities and effe
f ctiveness  Our marketing investments are targeted at acquiring new
customers, developing stronger relationships with our existing customers, and extending our customers
 tenure with
our brands. Recent areas of investment include brand marketing, personalization capabilities, a rebranded and
relaunched customer loyalty program, enhanced digital and social media programs, and strengthened consumer-facing
technologies such as our mobile app. Collectively these investments contributed to sequential improvement in U.S.
Retail comparable sales, growth in new and reactivated customers, and an improved retention rate in the second half of
fiscal 2024 compared to the first half of fiscal 2024.

Leverage our unparalleled multi-channel market
k
presence to extend the reach of our brands  Our global,
multichannel business model is unique. No other children
s apparel company in the world has our combined
capabilities in the retail store, online and wholesale channels.
We are the largest specialty retailer in North America focused on young children
s apparel, with over 1,000 company-
owned stores and dedicated websites in the United States, Canada, and Mexico. Across our retail fleet, we made
progress in fiscal 2024 accelerating remodels and introduc
d
ing new in-store experiences. In fiscal 2024, we opened our
first-ever flagship store in Atlanta, Georgia, which includes brand-centric presentations, in-store shops for baby,
a
toddler and kids, and Little Planet, modern digital displays, a gifting station, and community engagement events. We
believe learnings from the ongoing innovations at our flagship store will inspire new and remodeled store experiences
across our fleet.
In wholesale, we are the largest suppl
u
ier of young children
s apparel to the largest retailers in North America. We have
the most extensive distribution of childrenswear  our brands are sold in more than 19,500 wholesale retail locations in
North America and through our wholesale customers
 websites. Our brand reach effo
f
rts are enabled by our long-
standing wholesale customer partnerships, which are important contributors to our sales and profita
f
bi
a lity and consumer
brand awareness. We plan to continue to prioritize investments in our brand experiences with our wholesale partners,
both digitally and in-store. Outside of North America, our global distribution capabilities are further strengthened
through our relationships with multi-national retailers and other wholesale partners with over 1,100 points of
distribution, and over 150 global websites.
In addition to the fundamental areas above, we intend to pursue improvements to our operating model, which includes
improving our product and brand development processes in an effo
f
rt to be faster, nimbler and able to respond to
changing consumer prefer
f ences more rapi
a dly. We also plan to continue to pursue opportunities to improve productivity
throughout the business and to manage spending prude
r
ntly.
Our Brands
Carter
t

s & OshKos
K
h B
gos


h
Our Carter
s and OshKos
K
h product offe
f rings include apparel and accessories for babi
a es (sizes newborn to 24 months), toddlers
(sizes 2T to 5T), and kids (sizes 4-14).
For our Carter
s brands, our focus is on essential and fashion apparel products for babi
a es and young children, including
bodysuits, layette essentials, sleep and play, pants, tops and t-shirts, multi-piece sets, dresses, and sleepwear. We attribute our
leading market position to our strong value proposition, brand strength, distinctive design, commitment to quality, and our
broad distribution through our company-owned retail stores, websites, and mobile app, as well as our wholesale distribution
channel that includes successful
f
and long-standing relationships with leading global and national retailers. Our marketing
programs are targeted toward first-time parents, experienced parents, and gift-givers. Our core baby
a
product line provides
families with essential products and accessories, including value-focused multi-piece sets. We also have three exclusive
Carter
s brands: our Childl of Mine brand, which is sold at Walmart, our Just One You brand, which is sold at Target, and our
Simple Joys
o
brand, which is availabl
a e on Amazon.
4

Carter
s is the leading brand in the zero to 10-year-old market in the United States, with particular strength in the zero to two-
year-old segment. As of December 2024, our multichannel business model enabled our Carter
s brands to maintain a leading
market share of approximately 10% in the zero to 10-year-old market. Our Carter
s brands maintained the leading market
position with approximately 21% in the zero to two-year-old baby
a
market and maintained its leading market position with
approximately 11% in the three to four-year-old toddler market. Our Carter
s brands also have an approximately 3% market
share in the five to ten-year-old kid market.
The focus of the OshKos
K
h brand is high-quality playclothes, including denim jeans, overalls, core bottoms, knit tops, t-shirts,
and layering pieces for everyda
r
y use, primarily targeted at toddlers and young children. We believe our OshKos
K
h brand has
significant brand name recognition, which consumers associate with high-quality, durable, and authentic playclothes for young
children. As of December 2024, our OshKos
K
h brand
s market share was less than 1% of the zero to 10-year-old apparel market
in the United States.
For both our Carter
s and OshKos
K
h brands, we employ cross-functional teams to develop our product assortments. Team
members from merchandising, art, design, sourcing, product development, and planning follow a disciplined development
process. We believe this approach, which includes consumer research, value engineering, and rigorous attention to detail,
results in compelling consumer product offe
f rings, increases consumer response, and suppor
u
ts effi
f cient and productive
operations.
We are focused on strengthening our brands with consumers by differentiating our products through fabr
a
ic softness, on-trend
styling, updated packaging and presentation strategies, and consumer-facing marketing. We also place importance on
differentiating our brand experience through in-store fixtur
t
ing, branding, signage, photography, and advertising across all of our
global channels of distribution.
Licensed Products
We license our Carter
s, OshKos
K
h, Childl of Mine, Just One You, Simple Joys
o
, and Little Planet brands to various licensed
partners in order to expand our product offe
f rings into additional product categories such as footwear, outerwear, accessories
(such as hair accessories and jewelry)
r
, toys, home décor, cribs and baby
a
furniture, and bedding. These licensed partners develop
and sell our branded products through multiple sales channels, while leveraging our brand strength, customer relationships, and
designs. Licensed products provide our customers with a range of lifes
f
tyle products that complement and expand upon our baby
a
and young children
s apparel offe
f rings. Our license agreements require strict adherence to our quality and compliance standards
and provide for a multi-step product approval process. We work in conjunction with our licensing partners in the development
of our branded products to aim to ensure consistency across product offe
f rings with our brand vision of high-quality products at
market-leading value.
We also partner with other brand owners to further expand our retail apparel product offe
f rings, including a range of licensed
sports and character t-shirts, bodysuits, and sleepwear.
Skip Hop
o
Under our Skip Hop
o brand, we design, source, and market products that are sold primarily to expectant parents and families
with young children. Our Skip Hop
o brand is best known for diaper bags, kid
s bags, home gear, and products for playtime,
mealtime, bath time, and travel, and combines innovative functionality with attractive design. Skip Hop was the #1 brand in
diaper bags in 2024.
We believe Skip Hop
o is a global lifes
f
tyle brand. Skip Hop
o 
s core philosophy and positioning revolves around its brand promise
 Must-Hav
H
es * Made Better. This reflects the brand
s goal of creating innovative, smartly designed, and highly functional
essentials for parents, babi
a es, and toddlers. The Skip Hop
o team includes both in-house design and creative teams, each of which
is dedicated to meeting that goal. We have made investments to in-store fixtur
t
ing, branding, and signage, along with digital
advertising, to further strengthen the position of the Skip Hop
o brand. Skip Hop
o branded products are sold through our retail
stores, our eCommerce site, and in the wholesale channel.
Little
i
Plan
l
et
Our Little Planet brand launched in 2021 and is a primarily organic and sustainabl
a e apparel brand created to serve a growing
consumer need for beautiful
f
heirloom-quality baby
a
and toddler products developed using sustainabl
a e materials. The assortment
of products includes sleepwear, swimwear, outerwear, bedding, accessories, and toys. Little Planet products are sold through
our retail stores, our eCommerce site, and in the wholesale channel.
5
Form 10-K

Sales Channels
We sell our Carter
s, OshKos
K
h, Skip Hop
o , and Little Planet branded products through multiple channels, both in the United
States and globally.
U.S. Retail
Our U.S. Retail segment includes sales of our products through our U.S. retail stores and eCommerce sites, including through
our omni-channel capa
a
bi
a lities to allow our customers to experience our brands as a seamless shopping experience in the channel
of their choice.
Our U.S. retail stores are generally located in high-traffi
f c open-air shopping centers and malls in or near majo
a r cities or in outlet
centers that are near densely populated areas. We believe our brand strength, product assortment, shopping experience, and
high-quality service have made our retail stores a destination for consumers seeking children
s apparel and accessories.
Each of our stores carries an assortment of Carter
s, OshKos
K
h, and/or Skip Hop
o branded products, as well as other products,
including Little Planet branded products, depending on the store and location. As of the end of fiscal 2024, our stores averaged
approximately 5,100 square feet per location. As of the end of fiscal 2024, we operated 804 stores in the United States.
In the fourth quarter of fiscal 2024, we opened our first-ever flagship store in Atlanta, Georgia, which includes brand-centric
presentations, in-store shops for baby,
a
toddler and kids, as well as Little Planet, modern digital displays, a gifting station, and
community engagement events.
We regularly assess potential new retail store locations and closures of existing stores based on demographic factors, retail
adja
d cencies, competitive factors, population density, growth projections, and performance of existing stores as part of a rigorous
real estate portfol
f io optimization process.
We also sell our products through our U.S. eCommerce websites at www.carters.com, www.oshkosh.com, www.skiphop.com,
www.shoplittleplanet.com, and through our mobile app.
We focus on the customer experience through store and eCommerce website design, visual aesthetics, clear product
presentation, and exceptional customer service. Our eCommerce websites also featur
t
e product recommendations and online-
only offe
f rings.
We strive to create a seamless omni-channel experience between our retail stores and our eCommerce websites. Customers can
choose to have eCommerce purchases shipped directly to them (same-day shipping availabl
a e in select markets), to pick-up the
purchases in a store (buy-online, pick-up
u in-store), or through our curbside pick-up
u services. eCommerce purchases, including
from our eCommerce websites and mobile app, may be shipped from one of our distribution facilities or from a retail store
(buy-online, deliver-from-store). Store purchases are primarily fulfille
f
d from each store
s inventory,
r
but our in-store buy-online
services offe
f r our broadest assortment to be shipped to a customer from one of our distribution facilities or from another retail
store. We utilize radio frequency identific
f ation (RFID) technology in our stores. This technology helps us to improve our
management of inventory
r and allows us to fulfill
f
omni-channel orders more effe
f ctively.
U.S. Wholes
l
alel
Our U.S. Wholesale segment includes sales of our products to our U.S. wholesale customers.
Our Carter
s brand wholesale customers in the United States include majo
a r retailers, such as, in alphabe
a
tical order, Costco,
JCPenney, Kohl
s, Macy
s, and Sam
s Club. Additionally, our Childl of Mine exclusive brand is sold at Walmart, our Just One
You exclusive brand is sold at Target, and our Simple Joys
o
exclusive brand is availabl
a e on Amazon.
Our OshKos
K
h brand wholesale customers in the United States include majo
a r retailers, such as, in alphabe
a
tical order, Amazon
and Target.
Our Skip Hop
o brand wholesale customers in the United States include majo
a r retailers, such as, in alphabe
a
tical order, Amazon,
Target, and Walmart.
Our Little Planet brand wholesale customers in the United States include majo
a r retailers, such as, in alphabe
a
tical order, Amazon
and Target.
6

We collabor
a
ate with our wholesale customers to provide a consistent and high-level of service, and to drive growth through
eCommerce, replenishment, produc
d
t mix, and brand presentation initiatives. We also have frequent meetings with the senior
management of key accounts to align on strategic growth plans.
Our two largest wholesale customers accounted for 10.9% and 10.1%, respectively, of consolidated net sales in fiscal 2024.
Internatio
t nal
Our International segment includes sales of our products through our retail stores and eCommerce sites in Canada and Mexico.
As of the end of fiscal 2024, in Canada we operated 191 retail stores and an eCommerce site at www.cartersoshkosh.ca, and in
Mexico we operated 62 retail stores and an eCommerce site at www.carters.com.mx.
Our International segment includes sales of our products to wholesale accounts outside of the United States, including both
domestic retailers with international operations and international retailers. In addition, we license our Carter
s and OshKos
K
h
brands to international customers that sell our products through branded retail and online stores, as well as to wholesale
customers, within their licensed territories. Our International segment includes sales of our products to these licensees, and
royalty income based on sales made by certain licensees. As of the end of fiscal 2024 our International channel included
wholesale accounts in approximately 19,500 locations in North America and wholesale accounts and licensees who operated in
over 1,100 locations outside of North America. As of the end of fiscal 2024, we had approximately 40 international licensees
who operated in over 90 countries.
Our Marketing Strategy
For all our brands, our marketing is largely focused on driving brand prefer
f ence and engagement with first-time and
experienced parents, as well as gift-givers. Our goal is to have the most top-of-m
f
ind, prefer
f red brands in the young children
s
apparel market and to connect with diverse, digitally savvy consumers. As such, our marketing investments are targeted at
acquiring new customers, developing stronger relationships with our existing customers, and extending our customers
 tenure
with our brands. Included among our marketing investments are our newly developed marketing personalization capabilities, a
rebranded and relaunched customer loyalty program, enhanced digital and social media programs, and strengthened consumer-
facing technologies such as our mobile app.
We use our customer loyalty program in the United States to drive customer traffi
f c, sales, and brand loyalty. In the second
quarter of fiscal 2024, we rebranded and relaunched our loyalty program as Carter
s Rewards
d with the goals of further
deepening our customer loyalty, increasing the frequency of visits, and growing customer lifet
f ime value. This program is
integrated across our U.S. retail stores and online businesses. During fiscal 2024, our U.S. retail sales were predominantly made
to members of Carter
s Rewards
d .
Complementing our Carter
s Rewards
d loyalty program is our Carter
s private labe
a
l credit card, which provides added benefits
for our Carter
s Rewards
d customers. A third-party financial institution issues the Carter
s credit card to consumers and bears all
underwriting and credit risk under the program. Under the credit card program agreement with the third-party financial
institution, the Company receives payments for the establ
a ishment of new credit accounts, as well as royalties on the usage of the
credit card by customers.
Our Global Sourcing Network
We source all of our apparel and other products from a global network of third-party suppl
u
iers, primarily located in Asia. We
source the remainder of our products primarily through North America, Afri
f ca, and Central America. During fiscal 2024,
approximately 75% of our product was sourced from Vietnam, Cambodia, Bangladesh, and India, and approximately 60% of
the fabr
a
ic that was used in the manufact
f
ur
t
e of our products was sourced from China, with the remainder sourced primarily from
India, Vietnam, Thailand, and Bangladesh. We do not own any raw materials or manufact
f
ur
t
ing facilities.
Our sourcing operations are based in Hong Kong in order to facilitate better service and manage the volume of manufac
f
turing
in Asia. Our Hong Kong offi
f ce acts as an agent for subs
u
tantially all of our sourcing in Asia and monitors production at
manufact
f
ur
t
ers
 facilities to ensure quality control, compliance with our manufact
f
ur
t
ing specifications and social responsibility
standards, as well as timely delivery of finished apparel to our distribution facilities. We also have sourcing offi
f ces in
Cambodia, Vietnam, China, and Bangladesh to help suppor
u
t these effo
f
rts.
Prior to placing production, and on a recurring basis, we conduct assessments of political, social, economic, environmental,
trade, labor
a
and intellectua
t
l property protection conditions in the countries in which we source our products, and we conduct
assessments of our manufac
f
turers and suppl
u
y chain, as discussed under Responsible Sourcing below. In connection with
7
Form 10-K

the manufact
f
ur
t
e of our products, manufact
f
ur
t
ers purchase raw materials including fabr
a
ic and other materials (such as linings,
zippers, buttons, and trim) at our direction. We regularly inspect and supe
u
rvise the manufact
f
ur
t
e of our products as well as test
the products in order to maintain safety and quality control, monitor compliance with our manufact
f
ur
t
ing specifications and
social responsibility standards, and to ensure timely delivery. We also inspect finished products at the manufact
f
ur
t
ing facilities.
We generally arrange for the produc
d
tion of products on a purchase order basis with completed products manufact
f
ur
t
ed to our
design specifications. We assume the risk of loss predominantly on a Freight-On-Board (F.O.B.) basis when goods are
delivered to a shipper and are insured against losses arising during shipping.
We have not entered into any long-term contractua
t
l arrangements with any contractor or manufact
f
ur
t
er. We believe that the
production capacity of each foreign manufact
f
ur
t
er with which we have developed, or are developing, a relationship is adequate
to meet our production requirements for the foreseeable future. We believe that alternative foreign manufact
f
ur
t
ers are readily
availabl
a e.
We expect all of our suppl
u
iers shipping to the United States to adhere to the requirements of the U.S. Customs and Border
Protection
s Customs-Trade Partnership Against Terrorism (C-TPAT) program, including standards relating to facility
security, procedur
d
al security, personnel security, cargo security, and the overall protection of the suppl
u
y chain. In the event a
suppl
u
ier does not comply with our C-TPAT requirements, or if we have determined that the suppl
u
ier will be unabl
a e to correct a
deficiency, we may move that suppl
u
ier
s product through alternative suppl
u
y chain channels or we may terminate our business
relationship with the suppl
u
ier.
Responsible Sourcing
We continue to seek the best pricing in our sourcing practices, and with that goal in mind, we have adopted a factory
r on-
boarding program that allows us to assess each factory

r
s compliance with our ethical and social responsibility standards before
we place orders for product with that factory.
r
Additionally, we regularly assess the manufact
f
ur
t
ing facilities we use through
periodic on-site facility inspections, including the use of independent auditors to suppl
u
ement our internal staff.
f
We use audit
data and performance results to identify
f potential improvements, and we integrate this information into our on-going sourcing
decisions. Our vendor code of ethics, with which we require our factories to comply, outlines our standards for suppl
u
ier
behavior in creating a fair and safe workpl
k ace and covers employment practices, such as wages and benefits, working hours,
health and safety, working age, and discriminatory
r practices, as well as environmental, ethical, and other legal matters. In
addition, our social responsibility policy establ
a ishes our expectations for our global suppl
u
iers and guides our oversight. This
policy is derived from the policies, standards, and conventions of the International Labor
a
Organization, and includes a
commitment to the Universal Declaration of Human Rights.
Sustainability
We issued our fourth annual Raise the Future Impact Report in fiscal 2024, in which we highlighted our three strategic pillars
that guide our long-term corporate responsibility commitments: Product, Planet, and People. In furtherance of these
commitments, we discussed our effo
f
rts to grow our sustainabl
a e product offe
f rings, reduce our carbon
r
footpr
t
int, and upliftf our
workers and communities. At the end of fiscal 2024, we continued our transition to more sustainabl
a y grown cotton through the
Better Cotton Initiative, with over 50% of our cotton sourced through this program. Additionally, we expanded our use of
LENZING ECOVERO, a sustainabl
a y produced viscose fiber sourced from responsibly managed forests.
As a result of customer demand, we have increased the sales of and expanded the scope of our Little Planet brand and
PurelySoftf collection, and we plan to increase the availabi
a lity of sustainabl
a e choices across all our product lines to suppor
u
t the
growing demand. We have increased our transparency on our chemicals management process by publishing a Restricted
Subs
u
tances List, designating chemicals that should be minimized or avoided in our apparel and accessories, and are working
with our suppl
u
iers to minimize or avoid the use of such chemicals in our products. We use the OEKO-TEX® Standard 100
certific
f ation labe
a
l, a well-known certific
f ation for textiles tested for harmful subs
u
tances, which appeared on more than 98% of
our baby
a
apparel and sleepwear in fiscal 2024. We have establ
a ished targets, validated by the Science-Based Target Initiative, to
reduce risks associated with our Scope 1 and 2 greenhouse gas emissions.
Our Global Distribution Network
The majo
a rity of all finished goods manufact
f
ur
t
ed for us is shipped to our distribution facilities or to designated third-party
facilities for final inspection, allocation, and reshipment to customers. The goods are delivered to us and to our customers by
independent shippers. We choose the form of shipment based upon needs, costs, and timing considerations.
8

In the United States, we operate three distribution centers in Georgia: an approximately 1.1 million square-foot multichannel
facility in Braselton, a 0.5 million square-foot facility in Stockbridge, and a 0.2 million square-foot single-channel facility in
Jonesboro. We outsource certain distribution activities to third-party logistics providers located in Califor
f
nia and leverage
additional third-party providers in Georgia, as needed, primarily for storage seasonally. Our distribution center activities include
receiving finished goods from our vendors, inspecting those products, and preparing and shipping them to our wholesale
customers, retail stores, and eCommerce customers.
Internationally, we operate directly or outsource our distribution activities to third-party logistics providers in Canada, China,
Mexico, and Vietnam to suppor
u
t shipment to the United States, as well as our international wholesale accounts, international
licensees, international eCommerce operations, and Canadian and Mexican retail store networks.
Governmental Regulation
We are subj
u ect to laws, regulations and standards set by various governmental authorities and standard setting bodies around
the world, including in the United States, Canada, and Mexico, including:

those imposed by the Sarbanes-Oxley Act of 2002, the Dodd-Frank Wall Street Reform and Consumer Protection Act,
the Securities and Exchange Commission (SEC), and the New York Stock Exchange (NYSE);

the U.S. Foreign Corrupt
u
Practices Act, and similar world-wide anti-bribery
r laws;

the tax laws of the United States and other countries;

health care, employment and labor
a
laws;

product and consumer safety laws, including those imposed by the U.S. Consumer Product Safety Commission and the
Americans with Disabi
a lities Act of 1990;

data privacy laws, including the European Union General Data Protection Act (GDPA), the Califor
f
nia Consumer
Privacy Act (CCPA), and the Califor
f
nia Privacy Rights Act (CPRA);

trade, transportation and logistics related laws, including tariffs,
f
quotas, embargoes, and orders issued by Customs and
Border Protection and similar agencies in other countries; and

appl
a
icable environmental laws.
The majo
a rity of our products are imported into the United States, Canada, and Mexico. These products are subj
u ect to various
customs laws, which may impose tariffs, as well as quota restrictions. In addition, each of the countries in which our products
are sold has laws and regulations covering imports. The United States and other countries in which our products are sold may
impose, from time to time, new duties, tariffs, surcharges, or other import controls or restrictions including trade related
restrictions on the sourcing and importation of raw materials and finished goods, or adju
d st presently prevailing duty or tariff
rates or levels. We, therefor
f
e, actively monitor import restrictions and developments and seek to minimize our potential
exposure to import related risks through shifts
f
of production among countries, including consideration of countries with tariff
prefer
f ence and free trade agreements, manufact
f
ur
t
ers, and geographical diversific
f ation of our sources of suppl
u
y.
Additionally, we are subj
u ect to various other federal, state, local and foreign laws and regulations that govern our activities,
operations, and products, including data privacy, trut
r h-in-advertising, accessibility, customs, wage and hour laws and
regulations, and zoning and occupa
u
ncy ordinances that regulate retailers generally and govern the promotion and sale of
merchandise and the operation of retail stores and eCommerce sites. Noncompliance with these laws and regulations may result
in subs
u
tantial monetary penalties and criminal sanctions.
Competition
The baby
a
and young children
s apparel and accessories market is highly competitive. Competition in our market is generally
based on a variety of factors, including comfor
f
t and fit, quality, pricing, style, selection, and breadth of distribution. Both
national brand and private labe
a
l manufact
f
ur
t
ers, as well as specialty apparel brands and retailers, aggressively compete in the
baby
a
and young children
s apparel market. Our primary competitors include (in alphabe
a
tical order): Gap,
a
Old Navy, and The
Children
s Place; Cat & Jack (private labe
a
l sold exclusively in Target) and Garanimals (sold exclusively in Walmart); and
Disney, Nike, Adidas, and Under Armour (national brands). Because of the highly fragmented nature of the industry,
r
we also
compete with many small specialty brands and retailers. We believe that the awareness and strength of our brand names,
combined with the breadth and value of our product offe
f rings, broad distribution, scale, and operational expertise, position us
well against these competitors.
9
Form 10-K

Seasonality and Weather
We experience seasonal fluctuations in our sales and profit
f ability due to the timing of certain holidays and key retail shopping
periods, which generally have resulted in lower sales and gross profit
f
in the first half of our fiscal year versus the second half of
the year. Accordingly, our results of operations during the first half of the year may not be indicative of the results we expect
for the full fiscal year. In addition, our business is susceptible to unseasonabl
a e weather conditions, which could influence
consumer behavior, customer traffi
f c, and shopping habi
a ts. For example, extended periods of unseasonabl
a y warm temperatur
t
es
during the winter season or cool temperatur
t
es during the summer season could affe
f ct the level and timing of demand.
Human Capital Management
As of the end of fiscal 2024, we had approximately 15,350 employees globally. The tabl
a es below present the composition and
location of our employees:
Employee Count
% of Total
Retail stores
11,932
77.7 %
Corporate offi
f ces
1,866
12.2 %
Distribution centers
1,552
10.1 %
Total
15,350
100.0 %
Employee Count
% of Total
United States
12,170
79.3 %
Canada
2,205
14.4 %
Mexico
660
4.3 %
Other (primarily countries in Asia)
315
2.1 %
Total
15,350
100.0 %
Talent and Developm
l
ent
We are guided by our core values:

Act with Integrity

Exceed Expectations

Inspire Innovation

Succeed Together

Invest in People
We believe that to succeed as a business and to positively impact families and our communities, we must first create and
maintain an inclusive, suppor
u
tive workpl
k ace cultur
t
e that fosters high employee engagement. We believe in developing our
employees and offe
f r numerous formal training opportunities as well as ongoing informal on-the-jo
- b learning, including:

mentoring, reverse mentoring, and executive development programs that nurture emerging talent and facilitate
knowledge sharing, benefiting employees at all stages of their careers;

development days, when employees step away from their day-to-day responsibilities for curated profes
f
sional growth
opportunities;

online courses and formal development programs designed to enhance personal leadership skills, business acumen, and
people management skills, as well as specialized development resources for our retail store, distribution center and
offi
f ce employees; and

each year, we award scholarships to Carter
s employees and children of employees to attend an accredited college or
university.
Diversi
r ty
i
and Inclusion
We are committed to attracting and retaining multicultural consumers and, through various effo
f
rts across our global enterprise,
to building a workforce to suppor
u
t our consumer acquisition and retention effo
f
rts. Our Diversity & Inclusion (D&I) effo
f
rts
are focused on growing our relevance with all consumers with the suppor
u
t of cross-functional teams leveraging consumer
insights to inform our product, marketing, and consumer experience strategies. Our teams are also focused on ensuring fairness
across our global enterprise.
10

Health
l
and Safe
a ty
We maintain a cultur
t
e focused on safety with the goal of eliminating workpl
k ace incidents, risks and hazards. We have created
and implemented processes to help eliminate safety incidents by reducing their frequency and severity, and we review and
monitor our performance closely.
Available Information
Our corporate website address is https://corpor
r
ate.carters.com. On our investor relations website (ir.carters.com), we make
availabl
a e, free of charge, our SEC filings, such as Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current
Reports on Form 8-K, proxy statements, director and offi
f cer reports on Forms 3, 4, and 5, and any amendments to these reports,
as soon as reasonabl
a y practicabl
a e afte
f r we electronically file such material with, or furnish it to, the SEC. We also make
availabl
a e on our website the Carter
s Code of Ethi
t cs, the Vendor Code of Ethi
t cs, and the CSR
S
Repor
e
t our corporate governance
principles, and the charters for the Compensation, Audit, and Nominating and Corporate Governance Committees of the Board
of Directors. The information contained on our website is not included as part of,f or incorporated by reference into, this Annual
Report on Form 10-K or any other reports we file with or furnish to the SEC. The SEC maintains an internet site, www.sec.gov,
containing reports, proxy and information statements, and other information regarding issuers, including us, that file
electronically with the SEC.
11
Form 10-K

ITEM 1A. RISK FACTORS
Risk Factors Summary
The following is a summary of the principal
i
risk
i
s
k and uncertainties described in more detail in this Annual Repor
e
t on Form 10-
K for the year ended December 28, 2024.
Risks Related to Global and Macroeconomic Conditions

Our business is sensitive to overall levels of consumer spending, consumer confid
f ence, and consumer sentiment,
particularly in the young children
s apparel market.

Our business could be negatively impacted by political or economic risks that we are exposed to as a part of our global
operations.

Public health crises have and may in the future have a significant adverse effe
f ct on our business, financial condition,
and results of operations.
Risks Related to Our Brands and Product Value

The acceptance of our products in the marketpl
t ace is affe
f cted by consumer tastes and prefer
f ences, along with fashion
trends.

We may be unabl
a e to protect our intellectua
t
l property rights, which could diminish the value of our brands, weaken our
competitive position, and adversely affe
f ct our reputation and results.

The value of our brands, and our sales, could be diminished if we are associated with negative publicity, including
through actions by our employees, and our vendors, marketing partners, third-party manufact
f
ur
t
ers, and licensees, over
whom we have limited control.

Our future growth depends significantly on our branding and marketing effo
f
rts, and if our marketing effo
f
rts are not
successful
f
or if we receive negative publicity, the value of our brands, and our sales, could be diminished.

We may experience delays, product recalls, or loss of revenues or incur additional costs if our products do not meet
our quality standards.
Risks Related to Operating a Global Business
p
g

We face risks related to the uncertainty regarding the future of international trade agreements and the United States

position on international trade.

We operate in a highly competitive market and the size and resources of some of our competitors may allow them to
compete more effe
f ctively than we can.

Financial difficulties for, or the loss of one or more of,f our majo
a r wholesale customers could result in a material loss of
revenues.

Our retail success is dependent upon identifyi
f ng locations and negotiating appropriate lease terms for retail stores.

Our eCommerce business faces distinct risks, and our failure to successful
f ly manage it could have a negative impact
on our profit
f ability.

Profitabi
a lity and our reputation and relationships could be negatively affe
f cted if we do not adequately forecast the
demand for our products and, as a result, create significant levels of excess inventory
r or insufficient levels of
inventory.
r

Our profit
f ability may decline as a result of lower margins, such as through deflationary pressures on our selling prices
and increases in production costs and costs to serve.

We may not be able to increase prices to fully offs
f et inflationary pressures on costs, such as raw materials, labor
a
, and
transportation costs, which may impact our expenses and profit
f ability.

Our revenues, product costs, and other expenses are subj
u ect to foreign economic and currency risks due to our
operations outside of the United States.

Our business could suffer a material adverse effe
f ct from unseasonabl
a e or extreme weather conditions, or other effe
f cts
of climate change.

Environmental, social, and governance matters and any related reporting obligations may adversely impact our
business, financial condition and results of operations.
12

Risks Related to our Global Supply Chain and Labor Force
pp y

We source subs
u
tantially all of our products through foreign-based suppl
u
iers and manufact
f
ur
t
ers. Our dependence on
foreign suppl
u
y sources is subj
u ect to risks associated with global sourcing and manufact
f
ur
t
ing which could result in
disrupt
r
ions to our operations.

A relatively small number of vendors suppl
u
y a significant amount of our products, and losing one or more of these
vendors could have a material adverse effe
f ct on our business.

Labor or other disrupt
r
ions along our suppl
u
y chain may adversely affe
f ct our relationships with customers, reputation
with consumers, and results of operations.

Our inability to effe
f ctively source and manage inventory
r could negatively impact our ability to timely deliver our
inventory
r suppl
u
y and disrupt
r
our business, which may adversely affe
f ct our operating results.

Our Braselton, Georgia distribution facility handles a large portion of our merchandise distribution. If we encounter
problems with this facility, our ability to deliver our products to the market could be adversely affe
f cted.
Risks Relating to Litigation
g
g

We are and may become subj
u ect to various claims and pending or threatened lawsuits, including as a result of
investigations or other proceedings related to investigations.
Risks Relating to Cybersecurity, Data Privacy, and Information Technology
g
y
y,
y,
gy

Our systems, and those of our third-party vendors, containing personal information and payment data of our retail store
and eCommerce customers, employees, and other third parties could be breached, which could subj
u ect us to adverse
publicity, costly government enforcement actions or private litigation, and expenses.

Failure to implement new information technology systems or needed upgrades to our systems, including operational
and financial systems, could adversely affe
f ct our business.
Risks Relating to Our International Expansion
g
p

We may be unsuccessful
f
in expanding into international markets.
Risks Related to Governmental and Regulatory Changes
g
y
g

Failure to comply with the various laws and regulations as well as changes in laws and regulations could have an
adverse impact on our reputation, financial condition, or results of operations.
Risks Related to Executing Our Strategic Plan
g
g

Our failure to properly manage strategic initiatives in order to achieve our objectives may negatively impact our
business.

Our success is dependent upon retaining key individuals within the organization to execute our strategic plan.

We may be unabl
a e to grow through acquisitions or successful
f ly integrate acquired businesses, and such acquisitions
may fail to achieve the financial results we expected.
Risks Related to Financial Reporting, Our Debt, and Taxes
p
g,
,

We may not achieve sales growth plans, profit
f ability objectives, and other assumptions that suppor
u
t the carrying value
of our intangible assets.

We have subs
u
tantial debt, which could adversely affe
f ct our financial health and our ability to obtain financing in the
future and to react to changes in our business.

We may experience fluctuations in our tax obligations and effe
f ctive tax rate.
General Risks

Quarterly cash dividends and share repurchases are subj
u ect to a number of uncertainties, and may affe
f ct the price of
our common stock.

The market price of our common stock may be volatile.

Our amended and restated bylaws designate the Court of Chancery
r of the State of Delaware as the sole and exclusive
forum for certain types of actions and proceedings that may be initiated by our shareholders, which could limit our
13
Form 10-K

shareholders
 ability to obtain a favorable judicial forum for disputes with us or our directors, offi
f cers, employees, or
agents.
You shouldl carefu
e llyl consider
d
each of the following risk
i
factorsr as well as the othe
t
r info
n rmation contained in this Annual
Repor
e
t on Form 10-K and our othe
t
r filings with the SEC in evaluating our business. The risk
i
s
k and uncertainties described
below are not the onlyl ones we face. Addi
d tional risk
i
s
k and uncertainties not presently known to us or that we currently consider
d
immaterial may
a also
l
impac
m
t our business operations. If any of the following risk
i
s
k actually occur, our operating results may
a be
affe
f cted.d
Risks Related to Global and Macroeconomic Conditions
Our busine
i
ss is sensitiv
t e to overalll levelsl of consumer spending
i
,g consumer confid
f en
d
ce, and sentime
t
nt,t particular
l
ly in the
young childre
d
n
s
 apparel market.t
Both retail consumer and wholesale customer demand for young children
s apparel and accessories, specifically brand name
apparel products, is affe
f cted by the overall level of consumer spending, consumer confid
f ence, and sentiment. Overall spending
in the market is affe
f cted by a number of global and macroeconomic factors, such as overall economic conditions and
employment levels, gasoline and utility costs, business conditions, market volatility, bank failures, availabi
a lity of consumer
credit, tax rates, the availabi
a lity of tax credits, interest rates, inflationary pressures and general uncertainty regarding the overall
future political and economic climate, levels of consumer indebtedness, foreign currency exchange rates, weather, and overall
levels of consumer confid
f ence. For example, in recent years, the U.S. economy has been negatively impacted by historically
high inflation rates, which have negatively impacted and may continue to negatively impact consumer demand. Birth rate
fluctuations, which in turn affe
f ct the number of customers that are acquired and retained, can have a material impact on
consumer spending and our business. Reductions, or lower-than-expected growth, in the level of discretionary or overall
consumer spending may have a material adverse effe
f ct on our sales and results of operations.
Our busine
i
ss couldl be negat
e
iv
t elyl impacted by politi
l
cal and economic risk
i
s
k that we are expos
x
ed to as a result of our global
l
operations.
We are subj
u ect to general political and economic risks in connection with our global operations, including political instability
(both in the United States and globally, including the ongoing conflict between Russia and Ukraine and the related economic
and retaliatory measures), the ongoing war between Israel and Hamas, the conflic
f
t in the Red Sea region, terrorist attacks, and
changes in diplomatic and trade relationships, any of which may have a significant adverse effe
f ct on our business, financial
condition, and results of operations. Economic uncertainty in the United States and abroad has led to growing concerns about
the systemic impact of rising energy costs, geopolitical issues, or the availabi
a lity and cost of credit and higher interest rates,
which could further lead to increased market volatility, decreased consumer confid
f ence, and diminished growth expectations in
the U.S. economy and abroad. As our customers react to global economic conditions we have seen and may see customers
reduce spending on our products and take additional precautionary measures to limit or delay expenditures and preserve capi
a tal
and liquidity, thereby adversely affe
f cting our customers
 ability or willingness to purchase our products.
Public
l
health
l
crises have and may
a in the future have a sign
i
ific
f ant adverse
r
effe
f ct on our busine
i
ss, fina
i
ncial condit
d io
t n, and
results of operations.
We are subj
u ect to public health crises which have had, and may in the future have, a significant impact on our operations, cash
flow and liquidity. For example, the response to the COVID-19 pandemic negatively affe
f cted the global economy, disrupt
r
ed
global suppl
u
y chains, and created significant disrupt
r
ion in financial and retail markets, including increased unemployment rates
and a disrupt
r
ion in consumer demand for baby
a
and children
s clothing and accessories. Uncertainty caused by pandemics,
epidemics, or similar public health crises could lead to prolonged economic downtur
t
ns and reduce or delay demand for our
products, in which case our revenues could be significantly impacted. The extent to which a public health crisis impacts our
business, results of operations, and financial condition will depend on future developments, which are highly uncertain and
cannot be predicted.
Risks Related to Our Brands and Product Value
The acceptance of our productst in the marketpl
t ac
l
e is affe
f cted
t
by consumer tastes
t
and prefer
f
ences,s alon
l
g with
i
fashion
trends.
We believe that our continued success depends on our ability to create products that provide a compelling value proposition for
our consumers in all of our distribution channels. There can be no assurance that the demand for our products will not decline,
or that we will be able to successfully and timely evaluate and adapt our products to changes in consumer tastes and prefer
f ences
14

or fashion trends. If demand for our products declines, promotional pricing may be required to sell out-of-season or excess
merchandise, and our profit
f ability and results of operations could be adversely affe
f cted.
We may
a be unablel to protec
t
t our intellectual propertyt righ
i
ts,s which couldl dimin
i
ish the value of our brand, weaken our
competiti
t
ve positio
t n, and adverse
r
ly affe
f ct our repu
e
tation and results.
We currently rely on a combination of trademark, unfai
f r competition, and copyright laws, as well as licensing and vendor
arrangements, to establ
a ish and protect our intellectua
t
l property assets and rights. The steps taken by us or by our licensees and
vendors to protect our proprietary rights may not be adequate to prevent either the counterfeit production of our products or the
infringement of our trademarks or proprietary rights by others. Despite our effo
f
rts, our brands are still susceptible to
counterfeiting. Such counterfeiting dilutes our brands and can cause harm to our reputation and business. In addition,
intellectua
t
l property protection may be unavailabl
a e or limited in some foreign countries where laws or law enforcement
practices may not protect our proprietary rights and where third parties may have rights to conflic
f
ting trademarks, and it may be
more difficult for us to successful
f ly challenge the use of our proprietary
r rights by other parties in those countries. If we fail to
protect and maintain our intellectual property rights, the value of our brands could be diminished, and our competitive position
may suffer. Further, third parties may assert intellectual property claims against us, particularly as we expand our business
geographically or through acquisitions, and any such claim could be expensive and time consuming to defend, regardless of
their merit. Successful
f
infringement claims against us could result in significant monetary liabi
a lity or prevent us from selling
some of our products, which could have an adverse effe
f ct on our results of operations.
The value of our brands,s and our sales, couldl be dimin
i
ished if we are associated
t
with
i
negat
e
iv
t e public
l ity,y includin
d
g through
g
actions by our empl
m oy
l
ees,s and our vendors,
r
marketin
t
g partners,
r
third-par
-
ty manufac
f
turers, and licensees,s over whom we
have limite
i d contro
t
l.
Although we maintain policies with our employees, vendors, marketing partners, third-party manufact
f
ur
t
ers, and licensees that
promote ethical business practices, and our employees, agents, and third-party compliance auditors periodically visit and
monitor the operations of these entities, we do not control our vendors, third-party manufact
f
ur
t
ers, or licensees, or their
practices. A violation of our vendor policies, licensee agreements, health and safety standards, labor
a
laws, anti-bribery
r laws,
privacy laws or other policies or laws by these employees, vendors, third-party manufact
f
ur
t
ers, or licensees could damage the
image and reputation of our brands and could subj
u ect us to liabi
a lity. As a result, negative publicity regarding us or our brands or
products, including licensed products, could adversely affe
f ct our reputation and sales. Further, while we take steps to ensure the
reputations of our brands are maintained through license and vendor agreements, there can be no guarantee that our brand
image will not be negatively affe
f cted through its association with products or actions of our licensees, vendors, or third-party
manufact
f
ur
t
ers.
Our future growth depe
e
nds
d sign
i
ific
f antly on our branding
i
and marketin
t
g effo
f
rts,
t
and if our marketin
t
g effo
f
rtst are not
successful
f
or if we receive nega
e
tive public
l ity,y the value of our brands,s and our sales, couldl be dimin
i
ished.
We have invested significantly in our brands and believe that maintaining and enhancing our brands
 identities is cruc
r
ial to our
success. Our ability to attract customers depends in large part on the success of marketing effo
f
rts and the success of the
marketing channels we use to promote our products. Our marketing channels include earned media through press, social media
and search engine optimization, as well as paid advertising, such as online affi
f liations, search engine marketing, digital
marketing, social media marketing, influencer marketing, offl
f ine partnerships, direct mail, and television advertising. While our
goal remains to increase the strength, recognition and trus
r
t in our brands by increasing our customer base and expanding our
products, if in the future any of our current marketing channels becomes less effe
f ctive, if we are unabl
a e to continue to use any
of these channels, if we receive negative publicity or fail to maintain our brands, if the cost of using these channels significantly
increases or if we are not successful
f
in generating new channels, we may not be able to attract new customers or increase the
activity of our existing members on our platform in a cost-effec
f
tive manner.
We may
a expe
x
rience delays
a
,s product recalls,s or loss of revenues or incur additio
i
nal costst if our productst do not meet our
quality
l
stan
t
dards.
From time to time, we receive shipments of product from our third-party vendors that fail to confor
f
m to our quality standards.
A failure in our quality control program may result in diminished inventory
r levels and product quality, which in turn may result
in increased order cancellations and product returns, decreased consumer demand for our products, or product recalls, any of
which may have a material adverse effe
f ct on our results of operations and financial condition. In addition, products that fail to
meet our standards, or other unauthorized products, may be sold by third-parties without our knowledge or consent. This could
materially harm our brands and our reputation in the marketpl
t ace. Although we have not incurred any material product recalls
or delays to date, we have been subj
u ect to product recalls and/or delays in the past. We cannot provide any assurances that such
events will not occur and impacts therefro
f
m will not be material in the future.
15
Form 10-K

Risks Related to Operating a Global Business
p
g
We face risk
i
s
k related to the uncertainty regar
e
ding
i
the future of internatio
t nal trade agreements and the United Stat
t es
t


position on internatio
t nal trade.e
We sell products outside the U.S. through our multichannel global business model, and we source all of our apparel and other
products from a global network of third-party suppl
u
iers, primarily located in Asia. Certain policies and statements of the first
Trum
r
p administration that may continue in the second Trum
r
p administration have given rise to uncertainty regarding the future
of international trade agreements and the United States
 position on international trade. For example, the first Trum
r
p
administration imposed tariffs on a range of products from China, which led China to also impose tariffs on certain U.S. goods
in retaliation. Additionally, actions taken by, and announcements from, the second Trum
r
p administration, could result in
retaliatory tariffs imposed on U.S. businesses from China and any other countries affe
f cted by such tariffs. Moreover, the
uncertainty regarding the policies of the second Trum
r
p administration with respect to the future of trade partnerships and
relations, including the possibility of additional or increased tariffs, may reduce our competitiveness in countries that may be
affe
f cted by those policies, whether or not the second Trum
r
p administration ultimately takes any such actions. If increased or
additional tariffs or other restrictions, quotas, embargoes, or safeguards are placed on goods imported into the U.S., or any
related counter-measures are taken by other countries, we may have to raise our prices or increase inventory
r levels, or find new
sources of products that we import, and our revenue, gross margins, and results of operations may be materially harmed.
We operate in a high
i
ly competitiv
t
e market and the size
i
and resources of some of our competito
t
rs may
a allo
l w them to competet
more effe
f ctiv
t elyl than we can.
The global baby
a
and young children
s apparel and accessories market is highly competitive and includes both branded and
private labe
a
l manufac
f
turers. Because of the fragmented nature of the industry,
r
we also compete with many other manufac
f
turers
and retailers including in certain instances some of our wholesale accounts. Some of our competitors have greater financial
resources and larger customer bases than we have. As a result, these competitors may be able to adapt to changes in customer
requirements and prefer
f ences more quickly, take advantage of acquisitions and other opportunities more readily, devote greater
resources to the marketing and sale of their products, adopt more aggressive pricing strategies than we can, and more
successful
f ly utilize developing technology, including data analytics, artific
f ial intelligence, and machine learning.
Fina
i
ncial diffi
i
culties for, or the loss of one or more of our majo
a r wholes
l
alel custom
t
ersr couldl result in a material loss of
revenues.
A significant amount of our business is with our wholesale customers. For fiscal 2024, we derived approximately 36% of our
consolidated net sales from our U.S. Wholesale segment, approximately 35% of our consolidated net sales from our top ten
wholesale customers, and approximately 31% of consolidated net sales from our top five wholesale customers, which includes
net sales from our exclusive brands sold, in alphabe
a
tical order, at Amazon, Target, and Walmart. Our two largest wholesale
customers accounted for 10.9% and 10.1%, respectively, of consolidated net sales in fiscal 2024.
As of the end of fiscal 2024, approximately 83% of our gross accounts receivable were from our ten largest wholesale
customers, with three of these customers having individual receivable balances in excess of 10% of our total accounts
receivabl
a e. Furthermore, we do not enter into long-term sales contracts with our majo
a r wholesale customers, relying instead on
product performance, long-standing relationships, and our position in the marketpl
t ace.
As we have experienced in the past, we face the risk that if one or more of these customers significantly decreases their
business, does business with us on less favorable terms or terminates their relationship with us as a result of financial
difficulties (including bankrupt
r
cy or insolvency), competitive forces, consolidation, reorganization, changes in merchandising
strategies, or other reasons, then we may have significant levels of excess inventory
r that we may not be able to place elsewhere,
a material decrease in our sales, or material impact on our operating results. In addition, our reserves for estimated credit losses
resulting from the inability of our customers to make payments may prove not to be sufficient if any one or more of our
customers are unabl
a e to meet outstanding obligations to us, which could materially adversely affe
f ct our operating results. If the
financial condition or credit position of one or more of our customers were to deteriorate, or such customer fails, or is unabl
a e to
pay the amounts owed to us in a timely manner, this could have a significant adverse impact on our business and results of
operations. For instance, the parent company of buybuy BABY, Bed Bath & Beyond, Inc., filed for Chapter 11 bankrupt
r
cy in
April 2023 and closed all of its 360 stores.
Our retail success is depe
e
nden
d
t upon iden
d
tify
i ing locations and negot
e
ia
t ting appropriate lease terms for retail stor
t
es.
We derive a significant portion of our revenues through our retail stores in leased retail locations across the United States,
Canada, and Mexico. Successful
f
operation of a retail store depends, in part, on the overall ability of the retail location to attract
a consumer base sufficient to generate profita
f
bl
a e store sales volumes. A significant number of our stores are located in malls
16

and other shopping centers, and many of these malls and shopping centers have been experiencing declines in customer traffi
f c.
If we are unabl
a e to identify
f new retail locations with consumer traffi
f c sufficient to suppor
u
t a profita
f
bl
a e sales level, our retail
growth may be limited. Some new stores may be located in areas where we have existing sales channels. Increasing the number
of stores in these markets may result in inadvertent diversion of customers and sales from our existing sales channels in the
same market, thereby negatively affe
f cting our results of operations. Further, if existing stores do not maintain a suffic
f ient
customer base that provides a reasonabl
a e sales volume or we are unabl
a e to negotiate appropriate lease terms for the retail stores,
there could be a material adverse impact on our sales, gross margin, and results of operations. In addition, if consumer shopping
prefer
f ences transition more from brick-and-mortar stores to online retail experiences, with us or other retailers, any increase we
may see in our eCommerce sales may not be suffic
f ient to offs
f et the decreases in sales from our brick-and-mortar stores.
We also must be able to effe
f ctively renew our existing store leases on acceptabl
a e terms. In addition, from time to time, we may
seek to renegotiate existing lease terms or downsize, consolidate, reposition, or close some of our real estate locations, which in
most cases requires a modification of an existing store lease. Failure to renew existing store leases, secure adequate new lease
terms, or successful
f ly modify existing locations, or failure to effe
f ctively manage the profita
f
bi
a lity of our existing fleet of stores,
including the failure to successful
f ly identify
f and close underperforming stores, could have a material adverse effe
f ct on our
results of operations.
Additionally, the economic environment may at times make it difficult to determine the fair market rent of real estate properties
within the United States and internationally. This could impact the quality of our decisions to exercise lease options and renew
expiring leases at negotiated rents. Any adverse effe
f ct on the quality of these decisions could impact our ability to retain real
estate locations adequate to meet our profit
f
or growth targets or effi
f ciently manage the profita
f
bi
a lity of our existing fleet of
stores and could have a material adverse effe
f ct on our results of operations.
Our eCom
C
merce busine
i
ss faces dist
i in
t
ct risk
i
s,
k
and our failure to successful
f
ly
l
manage
a
it couldl have a negat
e
iv
t e impact on our
profita
f
bility
i
.y
The successful
f
operation of our eCommerce business as well as our ability to provide a positive shopping experience that will
generate consumer demand and drive subs
u
equent visits depends on effi
f cient and uninterrupt
u ed operation of our order-taking and
fulfillm
f
ent operations. Risks associated with our eCommerce business in the United States, Canada, and Mexico include:

the failure of the computer systems, including those of third-party vendors, that operate our eCommerce sites and
mobile apps, including, among others, inadequate system capacity, service outages, computer viruses, human error,
changes in programming, security breaches, system upgrades or migration of these services to new systems;

disrupt
u ions in telecommunications services or power outages;

reliance on third parties for computer hardware and software, as well as delivery
r of merchandise to our customers on-
time and without damage;

limitations of shipping volumes which may be imposed by service providers;

rapid technology changes;

the failure to deliver products to customers on-time and within customers
 expectations;

credit or debit card, or other electronic payment-type, fraud, or disrupt
r
ions in payment systems;

the diversion of sales from our physical stores;

natur
t
al disasters or adverse weather conditions;

changes in applicable federal, state and international regulations;

liabi
a lity for online content; and

consumer privacy concerns and regulation.
Problems in any of these areas could result in a reduction in sales, increased costs and damage to our reputation and brands,
which could adversely affe
f ct our business and results of operations. In addition, in both fiscal 2024 and fiscal 2023 we
experienced a decrease in net sales in our eCommerce channel compared to fiscal 2022. Our eCommerce business may continue
to be negatively impacted if we do not successful
f ly integrate our traditional brick-and-mortar shopping experience with our
eCommerce experience or if we fail to improve on our eCommerce shopping experience, and any increase we may see in net
sales from the growth in brick-and-mortar retail may not be suffic
f ient to offs
f et the decreases in net sales from eCommerce.
17
Form 10-K

Profita
f
bility
i
and our repu
e
tation and relationships
i
couldl be negat
e
iv
t elyl affe
f cted
t
if we do not adequatel
t yl forecast the demand
for our productst and, as a result,t create sign
i
ific
f ant levels of excess inventory or insuffi
u
cient levelsl of inventory.y
There can be no assurance that we will be able to successful
f ly anticipate changing consumer prefer
f ences and product trends or
economic conditions and, as a result, we may not successful
f ly manage inventory
r levels to meet our future order requirements. If
we fail to accurately forecast consumer demand, we may experience excess inventory
r levels or a shortage of product required to
meet the demand. Inventory
r levels in excess of consumer demand have resulted and may continue to result in inventory
r write-
downs and the sale of excess inventory
r at discounted prices, which could have an adverse effe
f ct on the image and reputation of
our brands and negatively impact profita
f
bi
a lity. On the other hand, if we underestimate demand for our products, our third-party
manufact
f
ur
t
ers may not be able to produce enough products to meet consumer requirements, and this could result in delays in
the shipment of products and lost revenues, as well as damage to our reputation and relationships. These risks could have a
material adverse effe
f ct on our brand image, as well as our results of operations and financial condition.
Our profita
f
bility
i
may
a declin
l
e as a result of lower margins, such as through
g
defl
e at
l io
t nary pressures on our sellin
l
g prices and
increases in productio
t n costst and costst to serve.
The global apparel industry
r is subj
u ect to pricing pressure caused by many factors, including intense competition, the
promotional retail environment, and changes in consumer demand. The demand for baby
a
and young children
s apparel and
accessories in particular may also be subj
u ect to other external factors, such as general inflationary pressures, as well as the costs
of our products, which are driven in part by the costs of raw materials (including cotton and other commodities), labor
a
, fuel,
transportation and duties, any increases in mandatory minimum wages, and the costs to deliver those products to our customers.
If external pressures, including increased inflationary pressures on our consumers
 discretionary spending and deflation, cause
us to reduce our sales prices and we fail to sufficiently reduce our product costs or operating expenses, or if we are unabl
a e to
fully optimize prices or pass on increased costs to our customers, our profit
f ability could decline. Additionally, while deflation
could positively impact our product costs, it could have an adverse effe
f ct on our average selling prices per unit, resulting in
lower sales and operating results. This could have a material adverse effe
f ct on our results of operations, liquidity, and financial
condition.
We may
a not be ablel to increase prices to fullyl offs
f et infl
n at
l io
t nary pressures on costs,
t
such as raw materials,
l
labor,r and
transportation costs,
t
which may
a impact our expe
x
nses and profit
f abi
t
lity
i
.y
As a large, branded marketer of apparel for babi
a es and young children, we rely on vendors, distribution resources and
transportation providers. In fiscal 2022 and 2023, the costs of raw materials, packaging materials, labor
a
, energy, fuel,
transportation, and other inputs necessary for the production and distribution of our products increased significantly. We have
recently seen moderation in the costs of raw materials and ocean freight, but cannot predict the impact that increased costs will
have on our expenses and profit
f ability.
Our attempts to offs
f et these cost pressures, such as through increases in the selling prices of some of our products, may not be
successful
f . Higher product prices may result in reductions in sales volume, as consumers may choose less expensive options, or
forego some purchases altogether, during an economic downtur
t
n. To the extent that price increases are not sufficient to offs
f et
these increased costs adequately or in a timely manner, and/or if they result in significant decreases in sales volume, our
business, financial condition, or operating results may be adversely affe
f cted. Conversely, if competitive pressures or other
fact
f
ors prevent us from offs
f etting increased costs by price increases, our profita
f
bi
a lity may decline.
Our revenues, product costs,
t
and othe
t
r expe
x
nses are subject to foreign
g
economic and currency
c risk
i
s
k due to our operations
outside
d of the United
t
Stat
t es
t
.
We have operations in Canada, Mexico, and Asia, and our vendors, third-party manufact
f
ur
t
ers, and licensees are located around
the world. The value of the U.S. dollar against other foreign currencies has experienced significant volatility in recent years.
While our business is primarily conducted in U.S. dollars, we source subs
u
tantially all of our production from Asia, and we
generate significant revenues in Canada. Our international wholesale customers have from time to time and may in the future be
negatively impacted by inflation, the stronger U.S. dollar, and global conflic
f
ts. Cost increases caused by currency exchange rate
fluctuations could make our products less competitive or have a material adverse effe
f ct on our profita
f
bi
a lity. Currency exchange
rate fluctuations could also disrupt
r
the businesses of our third-party manufact
f
ur
t
ers that produce our products by making their
purchases of raw materials or products more expensive and more difficult to finance. Additionally, fluctuations in currency
exchange rates impact the amount of our reported sales and expenses, which could have a material adverse effe
f ct on our
financial position, results of operations, and cash flows.
18

Our busine
i
ss couldl suff
u er
f
a material adverse
r
effe
f ct from unseasonablel or extreme weathe
t
r conditio
d
ns,s or othe
t
r effe
f ctst of
clima
l
te change.e
Our business is susceptible to unseasonabl
a e weather conditions, which could influence customer demand, consumer traffi
f c, and
shopping habi
a ts. For example, extended periods of unseasonabl
a y warm temperatur
t
es during the winter season or cool
temperatur
t
es during the summer season have in the past and could in the future affe
f ct the timing of and reduce or shiftf demand
for our products, and thereby could have an adverse effe
f ct on our operating results, financial position, and cash flows. In
addition, extreme weather conditions in the areas in which our stores are located could negatively affe
f ct our business, operating
results, financial position, and cash flows. For example, frequent or unusually heavy or intense snowfall, flooding, hurricanes,
heat stress and sea level rise, or other extreme weather conditions over an extended period have caused and could in the future
cause our stores to close for a period of time or permanently, and could make it difficult for our customers and employees to
travel to our stores or to receive products shipped to them, which in turn could negatively impact our operating results.
In addition, there is concern that climate change could cause signific
f ant changes in weather patterns around the globe and an
increase in the frequency and severity of natural disasters, which could have a long-term adverse impact on our business and
results of operations. These changes may increase the effe
f cts described above, and changing weather patterns could result in
decreased agricultur
t
al productivity in certain regions, which may limit availabi
a lity and/or increase the cost of certain key
materials, such as cotton.
Enviro
i
nmental, social,l and governance matters and any
n related repor
e
ting oblig
l atio
t ns may
a adverse
r
ly impact our busine
i
ss,
fina
i
ncial conditi
d
on and resultst of operations.
U.S. and international regulators, customers, and investors are increasingly focused on corporate environmental, social, and
governance (ESG) practices and disclosures and may evaluate our business or other practices according to a variety of ESG
targets, standards, and expectations. For example, new domestic and international laws and regulations relating to ESG matters
have been adopted or are under consideration, including laws and regulations related to disclosure of and risks related to
climate-change, extended producer responsibility matters, and sustainabi
a lity and traceability laws and regulations. These, and
additional legislation which may be passed, have caused and may cause us to incur additional costs of compliance due to the
need for expanded data collection, analysis, and certification with respect to greenhouse gas emissions and other climate change
related risks, as well as other ESG topics, which may be significant.
Although we have announced goals with respect to certain ESG topics, including Scope 1 and 2 greenhouse gas emissions,
suppl
u
iers with science-based sustainabi
a lity targets, waste, plastic packaging, and water usage, as well as goals with respect to
our products and our people, we may be unabl
a e to meet them, or we may revise our goals or targets, or change our priorities or
strategies. As a result, we may face adverse regulatory,
r
investor, media, or public scrutiny that may adversely affe
f ct our
business, results of operations, or financial condition. Furthermore, the criteria by which our ESG practices, including our
initiatives and public goals, are assessed may change due to the evolution of the sustainabi
a lity landscape, which could result in
greater expectations of us and may cause us to undertake costly initiatives to satisfy new criteria. If we are unabl
a e to respond
effe
f ctively to these changes to the sustainabi
a lity landscape, governments, customers, and investors may conclude that our
policies and/or actions with respect to ESG matters are inadequate. In addition, the methodologies for reporting and measuring
ESG metrics may change and may result in adju
d stments to previously reported information. If we fail or are perceived to have
failed to achieve previously announced public goals or to accurately disclose our progress on such goals or initiatives, our
reputation, business, results of operations, and financial condition could be adversely impacted.
Further, risks related to environmental and sustainabi
a lity policies, laws, technologies, and negative impacts on our reputation,
can impact our business in the short-, medium-, and long-term. For example, if global suppl
u
iers decide to pass additional costs
from current and emerging regulation related to emissions reductions or global carbon
r
tax schemes, we could be impacted by
those additional costs. Additionally, increasing consumer awareness of environmental issues has sparked a trend in the industry
r
of offe
f ring more sustainabl
a e products, allowing customers to make conscious decisions, which could put us at a competitive
disadvantage as compared to other companies with respect to some of our product offe
f rings.
19
Form 10-K

Risks Related to our Global Supply Chain and Labor Force
pp y
We source substantia
t lly alll of our productst through
g
foreign-
g
based suppl
u
ie
l rs and manufac
f
turers. Our depe
e
nden
d
ce on foreign
g
suppl
u
yl sources is subject to risk
i
s
k associated
t
with
i
global
l
sourcing
i
and manufac
f
turing
i
which couldl result in disru
i
pt
u io
t ns to our
operations.
We source subs
u
tantially all of our products through a network of vendors primarily in Asia, principally coordinated by our
Hong Kong sourcing offi
f ce. Our global suppl
u
y chain could be negatively affe
f cted due to a number of factors, including:

political instability or other global events resulting in the disrupt
r
ion of operations or trade in or with foreign countries
from which we source our products;

the occurrence of a natural disaster, unusual weather conditions, or a disease epidemic in foreign countries from which
we source our products;

fin
f ancial instability, including bankrupt
r
cy or insolvency, of one or more of our majo
a r vendors, including our
transportation providers and carriers;

the imposition of new laws and regulations relating to imports, duties, taxes, and other charges on imports, including
those that the U.S. government has implemented and may further implement on imports from China, such as the
Uyghur Forced Labor
a
Prevention Act and other sanctions and trade regulations issued by the U.S. government related
to forced labor
a
in the Xinjiang Uyghur Autonomous Region of China and other regions which may affe
f ct our sourcing
operations and the availabi
a lity of raw materials, including cotton, used by the vendors from which we purchase goods;

increased costs of raw materials (including cotton and other commodities), labor
a
, fuel, and transportation;

interrupt
u ions in the suppl
u
y of raw materials, including cotton, fabr
a
ic, and trim items;

increases in the cost of labor
a
in our sourcing locations;

changes in the U.S. customs procedur
d
es concerning the importation of apparel products, durable goods and
accessories;

unfor
f
eseen delays in customs clearance of any goods;

disrupt
u ions in the global transportation network, such as a port strikes or delays, work stoppages or other labor
a
unrest,
capacity withholding, world trade restrictions, acts of terrorism, war, vessel availabi
a lity due to longer transit times and/
or schedule changes or timing of new vessel commissioning, and ocean container availabi
a lity;

the application of adverse foreign intellectua
t
l property laws;

the ability of our vendors to secure sufficient credit to finance the manufact
f
ur
t
ing process, including the acquisition of
raw materials;

potential social compliance concerns resulting from our use of international vendors, third-party manufac
f
turers, and
licensees, over whom we have limited control;

manufac
f
turing delays or unexpected demand for products may require the use of faster, but more expensive,
transportation methods, such as air-freight services; and

other events beyond our control that could interrupt
u
our suppl
u
y chain and delay receipt of our products into the United
States, Canada, and Mexico, as well as the 90 additional countries in which our international partners and international
wholesale customers operate.
The occurrence of one or more of these events could result in disrupt
r
ions to our operations, which in turn could increase our
cost of goods sold, decrease our gross profit,
f
and/or impact our ability to deliver products to our customers. For example, in
fiscal 2024 we experienced delays with respect to our shipments via ocean vessels due to attacks by a militant group at the
entrance to the Red Sea region. These attacks required us to route shipments around the Cape
a
of Good Hope at the southern tip
of Afri
f ca, which has added an additional seven to ten days of transit time. If these hostilities, or hostilities in other regions of
the world, continue or escalate, our business and results of operations could be materially adversely affe
f cted.
Also, the United States Treasury Department has placed sanctions on China
s Xinjiang Production and Construc
r
tion
Corporation (XPCC) for human rights violations and took other significant steps to address the forced labor
a
concerns in the
Xinjiang Uyghur Autonomous Region (the XUAR) of China, including withhold release orders issued by U.S. Customs and
Border Protection, (US CBP). Additionally, on December 23, 2021, the Uyghur Forced Labor
a
Prevention Act (the UFLPA)
was signed into law, addresses the use of forced labor
a
in China
s Xinjiang Uyghur Autonomous Region (XUAR). Among
other things, the UFLPA imposes a presumptive ban on the import of goods to the United States that are made, wholly or in
part, in the XUAR or by persons that participate in certain programs in the XUAR that entail the use of forced labor
a
. The
UFLPA took effe
f ct on June 21, 2022 and, along with US CBP withhold release orders, may in turn have an adverse effe
f ct on
global suppl
u
y chains, including our own suppl
u
y chains for cotton and cotton-containing products, and the price of cotton in the
20

marketpl
t ace. The XUAR is the source of large amounts of cotton and textiles for the global apparel suppl
u
y chain. Although we
do not knowingly source any produc
d
ts from the XUAR and we have no known involvement with China
s Xinjiang Production
and Construc
r
tion Corporation (XPCC) or its affi
f liates, we could be subj
u ect to penalties, fines or sanctions if any of the
vendors from which we purchase goods is found or suspected to have dealings, directly or indirectly, with XPCC or entities
with which it may be affi
f liated. Additionally, our products have been and, in the future, could be held or delayed by the US
CBP under the withhold release orders, which would cause delays and unexpectedly affe
f ct our inventory
r levels. Even if we
were not subj
u ect to penalties, fines, or sanctions, if products we source are associated in any way to XPCC or the XUAR, our
reputation could be damaged.
A relativelyl smalll number of vendor
d
sr suppl
u
yl a sign
i
ific
f ant amount of our products,
t
and losing
i
one or more of these vendor
d
sr
couldl have a material adverse
r
effe
f ct on our busine
i
ss.
In fiscal 2024, we purchased approximately 62% of our products from ten vendors, with three vendors representing
approximately one half of the purchases made from our top ten vendors. Additionally, we estimate that approximately 60% of
the fabr
a
ic that is used in the manufact
f
ur
t
e of our products is sourced from China. We expect that we will continue to source a
significant portion of our products from these vendors. We do not have agreements with our majo
a r vendors that would provide
us with assurances on a long-term basis as to adequate suppl
u
y or pricing of our products. If any of our majo
a r vendors decide to
discontinue or significantly decrease the volume of products they manufact
f
ur
t
e for us, raise prices on products we purchase from
them, or become unabl
a e to perform their responsibilities (e.g., if our vendors become insolvent or experience financial
difficulties, manufac
f
turing capa
a
city constraints, significant labor
a
disputes, or restrictions imposed by foreign governments) our
business, results of operations, and financial condition may be adversely affe
f cted.
Labor or othe
t
r disru
i
pt
u io
t ns alon
l
g our suppl
u
yl chain
i
may
a adverse
r
ly affe
f ct our relationships
i
with
i
custom
t
ers,
r
repu
e
tation with
i
consumers,
r
and resultst of operations.
Our business depends on our ability to source and distribute products in a timely manner. Labor
a
disputes at third-party factories
where our goods are produced, the shipping ports we use, or within our transportation carriers create significant risks for our
business, particularly if these disputes result in work slowdowns, lockouts, strikes, or other disrupt
r
ions during our peak
manufact
f
ur
t
ing and importing times. For example, we source a significant portion of our products through a single port on the
West Coast of the United States. Work slowdowns and stoppages relating to labor
a
agreement negotiations involving the
operators of this west coast port and unions have in the past resulted in a significant backlog of cargo containers entering the
United States. We, along with other companies, have also shifte
f d a significant amount of our product deliveries to ports of entry
r
on the East Coast of the United States, which have experienced volume increases that created, and may continue to create,
delays at these ports that did not exist before we, and others, shifte
f d significant volume to them. The ports of entry
r to which we
deliver on the East Coast may also be subj
u ect to labor
a
disputes, work slowdowns, lockouts, strikes, or other disrupt
r
ions. Further,
in the past, the insolvency of a majo
a r shipping company has also had an effe
f ct on our suppl
u
y chain. As a result, we have in the
past experienced delays in the shipment of our products. In the event that these slow-downs, disrupt
r
ions or strikes occur in the
future in connection with labor
a
agreement negotiations or otherwise, it may have a material adverse effe
f ct on our financial
position, results of operations, or cash flows.
Our inability
i
to effe
f ctiv
t elyl source and manage
a
inventor
t
y
r couldl negat
e
iv
t elyl impact our ability
i
to timely deliver our inventory
suppl
u
yl and disru
i
pt
u
our busine
i
ss, which may
a adverse
r
ly affe
f ct our operating results.
We source all of our products from a global network of third-party suppl
u
iers. If we experience significant increases in demand,
or need to replace an existing vendor or shiftf production to vendors in new countries, there can be no assurance that additional
manufact
f
ur
t
ing capa
a
city will be availabl
a e when required on terms that are acceptabl
a e to us or that any vendor would allocate
sufficient capacity to us in order to meet our requirements. In addition, for any new vendors, we may encounter delays in
production and added costs as a result of the time it takes to train our vendors in producing our products and adhering to our
quality control standards. In the event of a significant disrupt
r
ion in the suppl
u
y of the fabr
a
ics or raw materials (including cotton)
used by our vendors in the manufactur
t
e of our products, such as an inability to source from a particular vendor or geographic
region, our vendors might not be able to locate alternative suppl
u
iers of materials of comparable quality at an acceptabl
a e price.
Any delays, interrupt
u ion, or increased costs in the manufac
f
ture of our products could have a material adverse effe
f ct on our
operating results or cash flows.
Additionally, the nature of our business requires us to carry a significant amount of inventory,
r
especially prior to the peak
holiday selling season when we increase our inventory
r levels, and to suppor
u
t our retail omni-channel strategies, including our
buy on-line and pick-up
u in store program. Merchandise usually must be ordered well in advance of the season in which it is
expected to be sold, and frequently before apparel trends are validated by customer purchases. We must enter into contracts for
the purchase and manufac
f
ture of merchandise well in advance of the applicable selling season. As a result, we are vulnerabl
a e to
demand and pricing shifts
f
and to subopt
u
imal selection and timing of merchandise purchases and allocations to our sales
21
Form 10-K

channels. In the past, we have not always predicted our customers
 prefer
f ences and acceptance levels of our trend items with
accuracy. If sales do not meet expectations, too much inventory
r may cause excessive markdowns and, therefor
f
e, lower-than-
planned margins, and too little inventory
r may result in lost sales.
Our Braselto
l n, Georgi
r a dist
i ri
t bution facility
i
handle
d s a large portion of our merchandis
d e dist
i ri
t bution. If we encounter
t
problem
l
s with
i
this facili
i ty
i ,y our ability
i
to deliver our productst to the market couldl be adverse
r
ly affe
f cted
t
.d
We process a large portion of our merchandise distribution for our U.S. stores and our eCommerce operations from our facility
in Braselton, Georgia. Our ability to meet consumer expectations, manage inventory,
r
complete sales, and achieve objectives for
operating effi
f ciencies depends on proper operation of this facility. If we are not able to distribute merchandise to our stores or
customers because we have exceeded our capacity at our distribution facility (such as a high level of demand during peak
periods) or because of natural disasters, health issues, accidents, system failures, disrupt
r
ions, or other events, our sales could
decline, which may have a materially adverse effe
f ct on our earnings, financial position, and our reputation. Additionally, we
have experienced significant competition in hiring employees for this facility, and in order to address this, we have increased
wages and implemented other policies in order to retain existing employees and attract additional employees. These wage
increases impacted our operating results. We are likely to continue to face challenges in hiring employees for this facility due to
increased competition and we may incur additional employee-related costs, when necessary, which would impact our operating
results. These staffi
f ng difficulties have caused and may in the future cause additional capacity constraints. Additionally, if we
are unabl
a e to adequately stafff this facility to meet demand, or if the cost of such staffi
f ng is higher than projected due to
competition, mandated wage increases, regulatory
r changes, or other factors, our operating results may be further harmed.
In addition, we use automated systems that manage the order processing for our eCommerce business. In the event that one of
these systems becomes inoperabl
a e for any reason, we may be unabl
a e to ship orders in a timely manner, and as a result, we could
experience a reduction in our direct-to-consumer business, which could negatively impact our sales and profita
f
bi
a lity.
Risk Relating to Litigation
g
g
We are and may
a become subject to various clai
l ms
i
and pendin
d
g or threaten
t
ed lawsuits
i ,s includin
d
g as a result of investigat
i
io
t ns
or othe
t
r proceedin
d
gs related to investig
t atio
t ns.
We are subj
u ect to various claims and pending or threatened lawsuits in the course of our business, including claims that our
designs infringe on the intellectua
t
l property rights of third parties. We are also affe
f cted by trends in litigation, including class
action litigation brought under various laws, including product liability, consumer protection, employment, and privacy and
information security laws. In addition, litigation risks related to claims that technologies we use infringe intellectua
t
l property
rights of third parties have been amplifie
f d by the increase in third parties whose primary business is to assert such claims. When
appropriate, reserves are establ
a ished based on our best estimates of our potential liabi
a lity. However, we cannot accurately
predict the ultimate outcome of any such proceedings due to the inherent uncertainties of litigation. Regardless of the outcome
or whether the claims are meritorious, legal and regulatory
r proceedings may require that management devote subs
u
tantial time
and expense to defend the Company. In the event we are required or decide to pay amounts in connection with any such claims
or lawsuits, such amounts could exceed applicable insurance coverage, if any, or contractua
t
l rights availabl
a e to us. As a result,
such lawsuits could be significant and have a material adverse impact on our business, results of operations and financial
condition. Product safety concerns may also require us to recall selected products at a subs
u
tantial cost to us, which may lead to a
lack of consumer trus
r
t and reputational harm to the affe
f cted brand. Product safety concerns, or the failure to manage recalls or
defects, could also result in governmental fines, product liabi
a lity litigation, lost sales and increased costs.
Risks Related to Cybersecurity, Data Privacy, and Information Technology
y
y,
y,
gy
Our system
t
s, and those of our third-par
-
ty vendors,
r
contai
t ni
i
ng
i
personal info
n
rmatio
t n and payment datat of our retail stor
t
e and
eCom
C
merce custom
t
ers,
r
empl
m oy
l
ees, and othe
t
r third parties couldl be breached,d which couldl subject us to adverse
r
public
l ity,y
costly
t
government enfo
n
rcement actions or privatet litig
t atio
t n, and expe
x
nses.
We rely on the security of our networks, databa
a
ses, systems, and processes to protect our proprietary information and
information about our customers, employees, and vendors, including customer payment information. We have establ
a ished
physical, electronic, and organizational measures to safeguard and secure our systems to prevent data compromise and rely on
commercially availabl
a e systems, software, tools, and monitoring to provide security for our IT systems and the processing,
transmission and storage of digital information. However, our IT systems are vulnerabl
a e to damage or interrupt
u ion from a
variety of sources, including physical damage, telecommunications or network failures or interrupt
u ions, system malfunc
f
tion,
natural disasters, malicious human acts, terrorism, and war, and we have experienced interrupt
u ions in the past. These systems,
including our servers, are also vulnerable to physical or electronic break-ins, security breaches from inadvertent or intentional
actions by our employees, third-party service providers, contractors, consultants, business partners, and/or other third parties, or
from cyber-attacks by malicious third parties (including the deployment of harmful malware, ransomware, denial-of-service
22

attacks, social engineering, and other means to affe
f ct service reliability and threaten the confid
f entiality, integrity, and
availabi
a lity of information). We have outsourced elements of our IT systems, including to cloud-based solution vendors, and
use third-party vendors in other aspects of our operations and, as a result, a number of third-party vendors may or could have
access to confid
f ential information. Our third-party vendors have experienced service interrupt
u ions and cyber-attacks in the past,
and we expect they will continue.
Cyber criminals are constantly devising schemes to circumvent information technology security safeguards and other retailers
have suffered serious data security breaches. The risk of a security breach or disrupt
r
ion, particularly through cyber-attacks or
cyber intrus
r
ion, including by computer hackers, foreign governments, and cyber terrorists, has generally increased as the
number, intensity, and sophistication of attempted attacks and intrus
r
ions from around the world have increased, due in part to
cyber-attacks stemming from the Russia-Ukraine conflic
f
t. Cybersecurity threat actors are increasingly targeting employees,
contractors, service providers, and third-parties through various techniques that involve social engineering and/or
misrepresentation. We may not be able to anticipate all types of security threats, and we may not be able to implement
preventive measures effective against all such security threats. The techniques used by cyber criminals change frequently,
including as a result of emerging technologies, such as artific
f ial intelligence and machine learning, may not be recognized until
launched, and can originate from a wide variety of sources, including outside groups such as external service providers,
organized crime affi
f liates, terrorist organizations, or hostile foreign governments or agencies. It is possible that we or our third-
party vendors may experience cybersecurity and other breach incidents that remain undetected for an extended period. Even
when a security breach is detected, the full extent of the breach may not be determined immediately. The costs to us to mitigate
network security issues, bugs, viruses, worms, malicious software programs and security vulnerabi
a lities could be significant
and, while we have implemented security measures to protect our IT and data security infrastructur
t
e, our effo
f
rts to address these
issues may not be successful
f .
If unauthorized parties gain access to our networks or databa
a
ses, or those of our vendors, they may be able to steal, publish,
delete, modify, or block our access to our private and sensitive internal and third-party information, including payment
information and personally identifia
f bl
a e information. In such circumstances, we could be held liabl
a e to our customers, other
parties, or employees as well as be subj
u ect to regulatory
r or other actions for breaching privacy law (including the E.U. GDPA,
CCPA, and the CPRA) or failing to adequately protect such information. This could result in costly investigations and litigation
exceeding applicable insurance coverage or contractua
t
l rights availabl
a e to us, civil or criminal penalties, operational changes, or
other response measures, loss of consumer confid
f ence in our security measures, and negative publicity that could adversely
affe
f ct our financial condition, results of operations, and reputation. Further, if we are unabl
a e to comply with the security
standards establ
a ished by banks and the payment processing industry,
r
we may be subj
u ect to fines, restrictions, and expulsion
from payment acceptance programs, which could adversely affe
f ct our retail operations. In addition, we may be required to incur
significant costs to protect against damage caused by these disrupt
r
ions or security breaches in the future. If our IT systems fail
and our redundant systems or disaster recovery plans are not adequate to address such failures, or if our business interrupt
u ion
insurance does not sufficiently compensate us for any losses that we may incur, our revenues and profits
f
could be reduced and
the reputation of our brand and our business could be materially and adversely affe
f cted.
We are also reliant on the security practices of our third-party service providers, which may be outside of our direct control. The
services provided by these third parties have been, and will likely continue to be, subj
u ect to the same risk of outages, other
fai
f lures and security breaches described above. If these third parties fail to adhere to adequate security practices, or experience a
breach of their systems, the data of our employees and customers may be improperly accessed, used or disclosed. In addition,
our third-party providers may take actions beyond our control that could harm our business, including discontinuing or limiting
our access to one or more services, increasing pricing terms, terminating, or seeking to terminate our contractua
t
l relationship
altogether, or altering how we are able to process data in a way that is unfav
f
orable or costly to us. Although we expect that we
could obtain similar services from other third parties, if our arrangements with our current providers were terminated, we could
experience interrupt
u ions in our business, as well as delays and additional expenses in arranging for alternative cloud
infrastructur
t
e services. Any loss or interrupt
u ion to our systems or the services provided by third parties, and the other risks from
cybersecurity threats described above, could adversely affe
f ct our business strategy, financial condition, or results of operations.
Although the aggregate impact of cybersecurity breaches has not been material to date, we have been subj
u ect to cybersecurity
and information security incidents in the past, including within the last three years and including third parties, and expect them
to continue as cybersecurity threats evolve in sophistication. We cannot provide any assurances that such events will not occur
and impacts therefro
f
m will not be material in the future.
23
Form 10-K

Failure to implement new info
n
rmatio
t n technology
o
system
t
s or needed
d
upgr
p
ades to our system
t
s, includin
d
g operational and
fina
i
ncial system
t
s, couldl adverse
r
ly affe
f ct our busine
i
ss.
As our business continues to grow in size, complexity, and geographic footpr
t
int, we have enhanced and upgraded our
information technology infrastructur
t
e and we expect there to be a regular need for additional enhancements and upgrades as we
continue to grow. Failure to implement new systems or upgrade systems, including operational and financial systems, as needed
or complications encountered in implementing new systems or upgrading existing systems could cause disrupt
r
ions that may
adversely affe
f ct our business and results of operations. Further, additional investments needed to upgrade and expand our
information technology infrastructur
t
e may require significant investment of additional resources and capital, which may not
always be availabl
a e or availabl
a e on favorable terms.
Risks Relating to Our International Expansion
g
p
We may
a be unsuccessful
f
in expan
x
ding
i
into internatio
t nal markets.
t
We cannot be sure that we can successful
f ly complete any planned international expansion or that new international business
will be profita
f
bl
a e or meet our expectations. We do not have significant experience operating in markets outside of North
America. Consumer demand, behavior, tastes, and purchasing trends may differ in international markets and, as a result, sales
of our products may not be successful
f
or meet our expectations, or the margins on those sales may not be in line with those we
currently anticipate. We may encounter differences in business culture and the legal environment that may make working with
commercial partners and hiring and retaining an adequate employee base more challenging. We may also face difficulties
integrating foreign business operations with our current operations, including our international suppl
u
y chain operations.
Significant changes in foreign laws or relations, such as political uncertainty and potential trade wars between nations in which
we operate, may also hinder our success in new markets. Our entry
r into new markets may have upfro
f
nt investment costs that
may not be accompanied by sufficient revenues to achieve typical or expected operational and financial performance and such
costs may be greater than expected. If our international expansion plans are unsuccessful
f , our results could be materially
adversely affe
f cted.
Risks Related to Governmental and Regulatory Changes
g
y
g
Failure to comply with
i
the various laws and regu
e
lations as well as changes in laws and regu
e
lations couldl have an adverse
r
impact on our repu
e
tation, fina
i
ncial conditio
d
n, or resultst of operations.
We are subj
u ect to laws, regulations and standards set by various governmental authorities around the world, including in the
United States, Canada, and Mexico, including:

those imposed by the Sarbanes-Oxley Act of 2002, the Dodd-Frank Wall Street Reform and Consumer Protection Act,
the SEC, and the NYSE;

the U.S. Foreign Corrupt
u
Practices Act, and similar world-wide anti-bribery
r laws;

health care, employment and labor
a
laws;

product and consumer safety laws, including those imposed by the U.S. Consumer Product Safety Commission and the
Americans with Disabi
a lities Act of 1990;

data privacy laws, including the E.U. GDPA and the CCPA;

trade, transportation and logistics related laws, including tariffsf and orders issued by Customs and Border Protection;
and

appl
a
icable environmental laws.
Our failure to comply with these various laws and regulations could have an adverse impact on our reputation, financial
condition, or results of operations. In addition, these laws, regulations, and standards may change from time to time, and the
complexity of the regulatory
r environment in which we operate may increase. Although we undertake to monitor changes in
these laws, if these laws change without our knowledge, or are violated by importers, designers, manufact
f
ur
t
ers, distributors, or
agents, we could experience delays in shipments and receipt of goods or be subj
u ect to fines or other penalties under the
controlling regulations, any of which could negatively affe
f ct our business and results of operations. Also, our inability, or that
of our vendors, to comply on a timely basis with regulatory
r requirements could result in product recalls, or significant fines or
penalties, which in turn could adversely affe
f ct our reputation and sales, and could have an adverse effe
f ct on our results of
operations. Issues with respect to the compliance of merchandise we sell with these regulations and standards, regardless of our
culpability or customer concerns about such issues, could result in damage to our reputation, lost sales, uninsured product
liabi
a lity claims or losses, product recalls, and increased costs.
24

Risks Related to Executing Our Strategic Plan
g
g
Our failure to properlyl manage
a
stra
t
tegi
e c initia
t tives in order to achieve our objectiv
t es may
a negat
e
iv
t elyl impact our busine
i
ss.
The implementation of our business strategy periodically involves the execution of complex initiatives, such as investments and
acquisitions, which may require that we make significant estimates and assumptions about opportunities and initiatives that we
may pursue. These projects could place significant demands on our accounting, financial, information technology, and other
systems, and on our business overall, and could require significant investment. We are dependent on our management
s ability
to oversee these projects effe
f ctively and implement them successful
f ly. If our estimates and assumptions about a project are
incorrect, or if we underestimate the resources or time we need to complete a project or fail to implement a project effe
f ctively,
our business and operating results could be adversely affe
f cted.
Given the trend of declining customer traffi
f c in malls and shopping centers, our multichannel business model is an important
pillar of our strategic plan. Our multichannel global business model, which includes retail store, eCommerce, and wholesale
sales channels, enables us to reach a broad range of consumers around the world. However, to be effe
f ctive, this strategy has and
will continue to require significant investment in cross-functional operations and management focus, along with investment in
suppor
u
ting technologies. Omni-channel retailing is rapi
a dly evolving and we must anticipate and meet changing customer
expectations and address new developments and technology investments by our competitors. Our omni-channel retailing
strategy includes implementing new technology, software, and processes to be able to fulfill
f
customer orders from any point
within our system of stores and distribution centers, which is extremely complex and may not meet customer expectations for
timely and accurate deliveries. We have made significant investments in our direct-to-consumer capabilities in recent years,
including same-day fulfil
f lment of online purchases and radio frequency identific
f ation (RFID) technology, in order to increase
the visibility and accuracy of our inventories. If we are unabl
a e to attract and retain employees or contract with third-parties
having the specialized skills needed to suppor
u
t our multichannel effo
f
rts, implement improvements to our customer-facing
technology in a timely manner, allow real-time and accurate visibility to product availabi
a lity when customers are ready to
purchase, quickly and effi
f ciently fulfill
f
our customers
 orders using the fulfillme
f
nt and payment methods they demand, or
provide a convenient and consistent experience for our customers regardless of the ultimate sales channel, our ability to
compete and our results of operations could be adversely affe
f cted. In addition, if our retail eCommerce sites or our other
customer-facing technology systems do not appeal to our customers, reliabl
a y function as designed, or maintain the privacy of
customer data, or if we are unabl
a e to consistently meet our brand and delivery
r promises to our customers, we may experience a
loss of customer confid
f ence or lost sales, or be exposed to fraudulent purchases, which could adversely affe
f ct our reputation
and results of operations.
Additionally, our pricing and other strategies for growing profita
f
bi
a lity may not achieve their objectives, may adversely affe
f ct
our business, inventory
r units sold, results of operations, and cash flows.
A failure to properly execute our plans and business strategies, delays in executing our plans and business strategies, increased
costs associated with executing on our plans and business strategies, or failure to identify
f alternative strategies could have a
material adverse effe
f ct on our business, financial position, results of operations, and cash flows.
Our success is depe
e
nden
d
t upon retaining key
e individualsl with
i
in the organ
r
izatio
t n to execute our stra
t
tegi
e c plan
l
.
Our ability to attract and retain qualifie
f d executive management, marketing, merchandising, design, sourcing, technology,
operations, including distribution center and retail store, and suppor
u
t function staffi
f ng is key to our success. We cannot be sure
that we will be able to attract, retain, and motivate a sufficient number of qualifie
f d personnel in the future, or that the
compensation costs of doing so will not adversely affe
f ct our operating results. With the recent retirement of our Chief
Executive Offi
f cer and our ongoing search for a new Chief Executive Offi
f cer, we provided retention awards to our executive
offi
f cers; however, our inability to retain our existing executives or appoint a new Chief Executive Offi
f cer could disrupt
r
our
business and may adversely affe
f ct our results of operations, financial position, and cash flows.
In addition, the expense for retaining our workforce may increase in response to competition, as necessary. Our inability to
retain personnel could cause us to experience business disrupt
r
ion due to a loss of historical knowledge and a lack of business
continuity and may adversely affe
f ct our results of operations, financial position, and cash flows.
We may
a be unablel to grow through
g
acquisitions or successful
f
ly
l
integr
e
atet acquired busine
i
sses, and such acquisitions may
a
fail to achieve the fina
i
ncial results we expe
x
cted
t
.d
From time to time we may acquire other businesses as part of our growth strategy, such as our acquisitions of the Skip Hop
o
brand and our Mexican licensee in fiscal 2017, and we may partially or fully fund future acquisitions by taking on additional
debt. We may be unabl
a e to continue to grow through acquisitions if we are not able to identify
f suitabl
a e acquisition candidates or
25
Form 10-K

acquire them on favorable terms, and potential acquisitions may be abandoned or delayed if necessary financing is not availabl
a e
or regulatory approvals cannot be obtained. For completed acquisitions, we may be unable to successfully integrate businesses
we acquire and such acquisitions may fail to achieve the financial results we expected. Integrating completed acquisitions into
our existing operations, particularly larger acquisitions, involves numerous risks, including harmonizing divergent technology
platforms, diversion of our management attention, failure to retain key personnel and customers, and failure of the acquired
business to be financially successful. In addition, we cannot be certain of the extent of any unknown or contingent liabi
a lities of
any acquired business, including liabi
a lities for failure to comply with applicable laws, such as those relating to product safety,
anti-bribery
r or anti-corrupt
u ion. We may incur material liabilities for past activities of acquired businesses. Also, depending on
the location of the acquired business, we may be required to comply with laws and regulations that may differ from those of the
jurisdictions in which our operations are currently conducted. Our inability to successful
f ly integrate businesses we acquire, or if
such businesses do not achieve the financial results we expect, may increase our costs and have a material adverse impact on
our financial condition and results of operations.
Risks Related to Financial Reporting, Our Debt, and Taxes
p
g,
,
We may
a not achieve sales growth plan
l
s, profita
f
bili
i ty
i
objectiv
t es,s and othe
t
r assumptions that suppor
u
t the carrying value of our
intangible assets.
The carrying values of our goodwill and tradename assets are subj
u ect to annual impairment reviews as of the last day of each
fiscal year or more frequently, if deemed necessary, due to any significant events or changes in circumstances. Estimated future
cash flows used in these impairment reviews could be negatively affe
f cted if we do not achieve our sales plans and planned
profita
f
bi
a lity objectives. Other assumptions that suppor
u
t the carrying value of these intangible assets, including a deterioration of
macroeconomic conditions which would negatively affe
f ct the cost of capital and/or discount rates, could also result in
impairment of the remaining asset values, which could be material. For example, in fiscal 2024, we recorded a non-cash pre-tax
impairment charge of $30.0 million on our OshKos
K
h indefinite-lived tradename asset, reflecting the effe
f ct of lower forecasted
sales and profita
f
bi
a lity. Additionally, in fiscal 2022, we recorded a non-cash pre-tax impairment charge of $9.0 million on our
Skip Hop
o indefinite-lived tradename asset, reflecting the effe
f ct of increased discount rates and lower forecasted sales and
profita
f
bi
a lity.
We have substantia
t l debt,t which couldl adverse
r
ly affe
f ct our fina
i
ncial health
l
and our ability
i
to obtai
t n
i
fina
i
ncing in the future
and to react to changes in our busine
i
ss.
As of the end of fiscal 2024, we had $500.0 million aggregate principal amount of debt outstanding (excluding $4.7 million of
outstanding letters of credit), and $845.3 million of undrawn availabi
a lity under our senior secured revolving credit facility afte
f r
giving effe
f ct to $4.7 million of letters of credit issued under our senior secured revolving credit facility. As a result, our ability
to obtain additional financing for working capital, capital expenditures, acquisitions, debt service requirements, or general
corporate or other purpos
r
es may be limited, and we may be unabl
a e to renew or refinance our debt on terms as favorable as our
existing debt or at all.
If our liquidity, cash flows, and capital resources are insuffic
f ient to fund our debt service obligations and other cash
requirements, we could be forced to reduce or delay investments and capital expenditures or to sell assets or operations, seek
additional capital, or restructur
t
e or refinance our indebtedness. We may not be able to effe
f ct any such alternative measures, if
necessary, on commercially reasonabl
a e terms or at all and, even if successful
f , such alternative actions may not allow us to meet
our scheduled debt service obligations. In the absence of such operating results and resources, we could face subs
u
tantial
liquidity problems and might be required to dispose of material assets or operations to meet our debt service and other
obligations.
In addition, both our senior secured revolving credit facility and, in certain circumstances, the indentur
t
e that governs the senior
notes contain restrictive covenants that, subj
u ect to specifie
f d exemptions, restrict our ability to incur indebtedness, grant liens,
make certain investments (including business acquisitions), pay dividends or distributions on our capital stock, engage in
mergers, dispose of assets and use the proceeds from any such dispositions, and raise debt or equity capital to be used to repay
other indebtedness when it becomes due. These restrictions may limit our ability to engage in acts that may be in our long-term
best interests, and may make it difficult for us to execute our business strategy successful
f ly or effe
f ctively compete with
companies that are not similarly restricted. In particular, we cannot guarantee that we will have sufficient cash from operations,
borrowing capacity under our debt documents, or the ability to raise additional funds in the capital markets to pursue our
growth strategies as a result of these restrictions or otherwise. We may also incur future debt obligations that might subj
u ect us to
additional restrictive covenants that could affe
f ct our financial and operational flexibility.
26

We may
a expe
x
rience fluctuatio
t ns in our tax
a oblig
l atio
t ns and effe
f ctiv
t e tax
a rate.e
We are subj
u ect to income taxes in federal and applicable state and local tax jurisdictions in the United States, Canada, Hong
Kong, Mexico, and other foreign jurisdictions. Our taxabl
a e income in each jurisdiction is affe
f cted by certain transfer
f
pricing
arrangements between affi
f liated entities. Challenges to the arms-length nature of these transfer
f
prices could materially affe
f ct
our taxabl
a e income in a taxing jurisdiction, and therefor
f
e affe
f ct our income tax expense. We record tax expense based on our
estimates of current and future payments, which include reserves for estimates of uncertain tax positions. At any time, many tax
years are subj
u ect to audit by various taxing jurisdictions. The results of these audits and negotiations with taxing authorities may
impact the ultimate settlement of these tax positions. As a result, there could be ongoing variability in our quarterly tax rates as
taxabl
a e events occur and exposures are re-evaluated. Further, our effe
f ctive tax rate in any financial statement period may be
materially affe
f cted by changes in the geographic mix and level of earnings.
During the requisite service period for compensabl
a e equity-based compensation awards that we may grant to certain employees,
we recognize a deferred income tax benefit on the compensation expense we incur for these awards for all employees, subj
u ect to
a limitation applicable to our named executive offi
f cers. At time of subs
u
equent vesting, exercise, or expiration of an award, the
difference between our actual income tax deduction, if any, and the previously accrue
r
d income tax benefit is recognized in our
income tax expense/be
/
nefit during the current period and can consequently raise or lower our effe
f ctive tax rate for the period.
Such differences are largely dependent on changes in the market price for our common stock.
We cannot predict whether quotas, duties, taxes, or other similar restrictions will be imposed by the United States or foreign
countries upon the import or export of our products in the future, or what effe
f ct any of these actions would have, if any, on our
business, financial condition, or results of operations.
Changes in regulatory,
r
geopolitical, social or economic policies, treaties between the United States and other countries, and
other factors may have a material adverse effe
f ct on our business in the future or may require us to exit a particular market or
significantly modify our current business practices. For example, our taxabl
a e income may be affe
f cted by new laws, rulings,
initiatives, and other events, which may affe
f ct our business, results of operations, or financial condition in future periods,
including:

the CARES Act, which was enacted in March 2020, and which significantly affe
f cts U.S. taxation by providing a
retention credit and eases limitations on certain deductions including interest due to potential volatility in 2020 taxabl
a e
income;

a 2018 U.S. Supr
u
eme Court ruling, under which states may have additional ability to tax entities operating in their
state, but lacking physical presence;

mandatory country by country reporting of revenue, employees and profits
f
, and certain international initiatives (such
as the Organisation for Economic Co-operation and Development (OECD)
s Base Erosion and Profit
f
Shiftin
f
g (BEPS))
that are focused on the equity of international taxation, which may ultimately result in a worldwide minimum tax, or
more defined approach around global profit
f
allocation between related companies operating in jurisdictions with
disparate income tax rates; and

tax revenue reductions as a result of the economic impact of the pandemic, which may lead to increases in state tax
rates or the expansions of their tax base.
General Risks
Quarterlyl cash dividends
d and share repu
e
rchases are subject to a number of uncertainties, and may
a affe
f ct the price of our
common stoc
t
k.
Quarterly cash dividends and share repurchases under our share repurchase program have historically been part of our capital
allocation strategy. Although we reinstated our share repurchase program in August 2021 and resumed payment of a quarterly
dividend in the third quarter of fiscal 2021, in the first quarter of fiscal 2020 we suspended both our quarterly cash dividends
and our share repurchase program due to the effe
f cts of the COVID-19 pandemic, and we are not required to declare dividends
or make any share repurchases under our share repurchase program in the future. Furthermore, the Company paused share
repurchases beginning in the third quarter of 2024, but future repurchases may occur from time to time in the open market, in
privately negotiated transactions, or otherwise. Decisions with respect to future dividends and share repurchases are subj
u ect to
the discretion of our Board of Directors and will be based on a variety of factors, including restrictions under our secured
revolving credit facility, market conditions, the price of our common stock, the nature and timing of other investment
opportunities, changes in our business strategy, the terms of our financing arrangements, our outlook as to the ability to obtain
financing at attractive rates, the impact on our credit ratings and the availabi
a lity of domestic cash. A subs
u
equent reduction or
elimination of our cash dividend, or subs
u
equent recommencement and later suspension or elimination of our share repurchase
program, could adversely affe
f ct the market price of our common stock. Additionally, there can be no assurance that any share
27
Form 10-K

repurchases will enhance shareholder value because the market price of our common stock may decline below the levels at
which we repurchased shares of common stock, and short-term stock price fluctuations could reduce the program
s
effe
f ctiveness.
The market price of our common stoc
t
k may
a be volatile
i .e
The market price of our common stock may fluctuate subs
u
tantially. Future announcements concerning us or our competitors
,
fin
f ancial results, quarterly variations in operating results or comparable sales, updates on strategic initiatives, failure to meet
analyst or investor expectations, failure of investors or analysts to understand our business strategies or fundamental changes in
our business or sector, among other factors, could cause these fluctuations. In addition, stock markets have experienced periods
of significant price or volume volatility in recent years. This volatility has had a subs
u
tantial effe
f ct on the market prices of
securities of many public companies for reasons frequently unrelated to the operating performance of the specific companies.
Stock price volatility may also impact our decisions with respect to future dividends and share repurchases.
Our amended and restat
t ed
t
bylaws design
i
atet the Court of Chancery of the Stat
t et of Delaware as the sole and exclusive forum
for certain type
y
s of actions and proceedin
d
gs that may
a be initia
t ted by our shareholde
l
rs, which couldl limit our shareholde
l
rs

ability
i
to obtai
t n
i
a favorablel judicial forum for disp
i
utes
t
with
i
us or our dire
i
ctor
t
s,
r
offi
f cers,
r
empl
m oy
l
ees,s or agents.
t
Our amended and restated bylaws provide that, unless we consent in writing to the selection of an alternative forum, the Court
of Chancery
r of the State of Delaware will, to the fullest extent permitted by applicable law, be the sole and exclusive forum for
(i) any derivative action or proceeding brought on our behalf,f (ii) any action asserting a claim of breach of a fiduciary duty
owed by any of our directors, offi
f cers, employees, or agents to us or our shareholders, (iii) any action asserting a claim arising
pursuant to any provision of the Delaware General Corporation Law (the DGCL), our certific
f ate of incorporation or our
bylaws, or (iv) any action asserting a claim against us that is governed by the internal affa
f irs doctrine, in each such case subj
u ect
to such Court of Chancery
r having personal jurisdiction over the indispensabl
a e parties named as defendants therein. This
exclusive forum provision is not intended to apply to actions arising under the Exchange Act or the Securities Act of 1933, as
amended. The Court of Chancery
r of the State of Delaware has held that a Delaware corporation can only use its constitut
t ive
documents to bind a plaintifff to a particular forum where the claim involves rights or relationships that were establ
a ished by or
under the DGCL.
Any person or entity purchasing or otherwise acquiring any interest in shares of our capital stock will be deemed to have notice
of,f and consented to, the forum selection provision of our amended and restated bylaws. The choice of forum provision may
limit a shareholder
s ability to bring a claim in a judicial forum that it finds favorable for disputes with us or our directors,
offi
f cers, employees, or agents, which may discourage such lawsuits against us and such persons. Alternatively, if a court were
to find this provision of our amended and restated bylaws inapplicable to, or unenfor
f
ceable in respect of,f one or more of the
specified types of actions or proceedings, we may incur additional costs associated with resolving such matters in other
jurisdictions, which could adversely affe
f ct our business, financial condition, or results of operations.
ITEM 1B. UNRESOLVED STAFF COMMENTS
None.
ITEM 1C. CYBERSECURITY
Risk Management and Strategy
To effe
f ctively assess, identify, and manage material risks from cybersecurity threats, the Company maintains a cyber risk
management program, which is led by our Chief Information Security Offi
f cer and Vice President of Infrastructure
t
Services and
Suppl
u
y Chain Systems (the CISO). The CISO reports to the Executive Vice President, Chief Information & Technology
Offi
f cer (the CITO), who in turn reports to the CEO.
The Company has implemented the following processes to assess, identify,
f
and manage material risks from cybersecurity
threats:

Annual audits, by an independent third party, of the Company
s cybersecurity framework under the National Institute
for Standards and Technology (NIST) cybersecurity framework;

Penetration tests conducted by a third-party;

Simulation of attacks on the Company
s systems by third-parties to test the Company
s systems and protections;

Tabl
a e-top simulation exercises involving the Company
s management and its third-party consultants and advisors to
simulate a cyber incident and the Company
s response to that incident, pursuant to the Company
s Incident Response
Plan; and
28


Payment card industry
r (PCI) audits to assess the Company
s processing of credit card transactions pursuant to
standards adopted by the PCI.
In addition, to mitigate material risks from cybersecurity threats, the Company has implemented various controls, including, but
not limited to, the following:

Intrusion prevention controls (such as network segmentation and firewalls);

Access controls (such as identity and access management and multi-factor authentication on critical applications and
systems);

Detection controls (such as endpoint threat detection and response, and logging and monitoring involving the use of a
third-party for security information and event management, with reports and alerts provided by the third-party to the
CISO
s team); and

Threat protection controls (such as mandatory cyber-threat training and simulated phishing campaigns with employees,
vendor management programs, and vulnerabi
a lity and patch management).
The Company has integrated its processes for assessing, identifying, and managing material risks from cybersecurity threats
into its overall risk management framework, including through coordination with the Company
s internal leader of Enterprise
Risk Management, and through quarterly reporting to the Company
s Audit Committee. Cybersecurity threats, including as a
result of any previous cybersecurity incidents incurred either by us or third parties, have not materially affe
f cted or are
reasonabl
a y likely to materially affe
f ct the Company, including its business strategy, results of operations, or financial condition,
except as disclosed in the risk factor titled Our systems, and those of our third-party vendors, contain personal information and
payment data of our retail store and eCommerce customers, and other third parties could be breached, which could subj
u ect us to
adverse publicity, costly government enforcement actions or private litigation, and expenses in Part I, Item 1A, Risk Factors.
The Company has also implemented processes for overseeing and identifyi
f ng risks from cybersecurity threats associated with
its use of third-party service providers. For example, the Company has implemented the following:

Vendor onboarding processes including a Privacy Impact Assessment and a Cyber Security and Compliance
Questionnaire; and

Enrollment of each vendor in a third-party risk monitoring tool that alerts the CISO
s team should that vendor
s
security posture change.
Governance
The Audit Committee of the Board of Directors oversees risks from cybersecurity threats, including through quarterly reports to
the Audit Committee by the Company
s CISO and CIO and, as needed, special reports to the Audit Committee and/or the
Chairperson of the Audit Committee. The Audit Committee includes members with technology and cybersecurity experience
and certific
f ations, including a Committee member with over 28 years of experience working for Hewlett Packard Enterprise
Company and a Committee member with a Computer Emergency Readiness Team (CERT) Certific
f ate in Cybersecurity
Oversight issued by the CERT Division of the Software Engineering Institute at Carnegie Mellon University and completion of
the National Association of Corporate Directors Master Course in Cybersecurity.
Management plays an integral role in assessing and managing the Company
s material risk from cybersecurity risks. The
assessment and management of those risks is led by the Company
s CISO, who has over 20 years of experience working in
information technology, including over 10 years specifically focused on information security, infrastructur
t
e, and strategy, and
the Company
s CIO, who has over 30 years of experience in Retail, Consumer Produc
d
ts, Merchandising, and IT, of which 16
years have been in leadership roles, and implemented by the CISO
s team, who are responsible for leading enterprise-wide
cybersecurity strategy, policy, standards, architectur
t
e, processes and operations. The CISO and CIO lead quarterly meetings of
the Company
s Security Executive Steering Committee (the Steering Committee), which is composed of the Company
s
CFO, General Counsel, and CIO. The Steering Committee drives awareness, ownership and alignment across broad governance
and risk stakeholder groups for effe
f ctive cybersecurity risk management and reporting.
The Company
s management maintains and implements a written Incident Response Plan, which is reviewed and updated on an
annual basis and includes an Incident Response Plan Executive Committee consisting of the Company
s CIO, CISO, and
General Counsel. In addition, members of the CISO
s and CIO
s teams monitor the Company
s systems and processes and
promptly report incidents as required under the Incident Response Plan, including, but not limited to, reporting to the
appropriate members of management and, as needed, the Audit Committee.
29
Form 10-K

The Incident Response Plan has been developed to align with the four phases for the security handling lifecy
f
cle set forth in the
National Institute for Standards and Technology Special Publ
u ication 800-61: (1) Preparation, (2) Detection & Analysis, (3)
Containment Eradication & Recovery, and (4) Post-Incident Activity.
ITEM 2. PROPERTIES
The following is a summary
r of our principal owned and leased properties as of December 28, 2024.
Our corporate headquarters occupi
u es 209,000 square feet of leased space in a building in Atlanta, Georgia. Our lease for that
space expires in July 2035. In addition, we occupy
u
leased space in a building in Mississauga, Ontario, which serves as our
regional headquarters for Canada, and we occupy
u
leased space in Hong Kong, which serves as our principal sourcing offi
f ce in
Asia. We also lease other space in Georgia and New York, as well as in Bangladesh, Cambodia, China, Mexico, and Vietnam
that, depending on the site, serves as a sourcing, sales, or administrative offi
f ce. We also own a 224,000 square foot facility in
Griffi
f n, Georgia.
Our largest distribution centers, which we lease, are located in Braselton, Georgia, Stockbridge, Georgia, and Jonesboro,
Georgia and are 1.1 million, 0.5 million, and 0.2 million square feet, respectively. The distribution centers in Braselton, Georgia
and Stockbridge, Georgia suppo
u
rt all of our operating segments, and the distribution center in Jonesboro, Georgia suppor
u
ts our
U.S. Wholesale segment. We also lease additional space in or use third-party logistics providers in California, Canada, China,
Mexico, and Vietnam for warehousing and distribution purpos
r
es.
We also operate the following number of leased retail stores: 804 in the United States, 191 in Canada, and 62 in Mexico. Our
average remaining lease term for retail store leases in the United States, Canada, and Mexico is approximately 3.4 years,
excluding renewal options.
ITEM 3. LEGAL PROCEEDINGS
We are subj
u ect to various claims and pending or threatened lawsuits in the normal course of our business. The Company is not
currently a party to any legal proceedings that it believes would have a material adverse effe
f ct on its financial position, results
of operations, or cash flows.
ITEM 4. MINE SAFETY DISCLOSURES
Not applicable.
30

PART II
ITEM 5. MARKET FOR REGISTRANT
S COMMON EQUITY, RELATED STOCKHOLDER MATTERS, AND
ISSUER PURCHASES OF EQUITY SECURITIES
Common Stock
Our common stock trades on the New York Stock Exchange (NYSE) under the trading symbol CRI. As of Februa
r
ry 18, 2025,
there were 178 holders of record of our common stock. The vast majo
a rity of holders of our common stock are street name or
beneficial holders, whose shares of record are held by banks, brokers, and other financial institutions.
Open Market Share Repurchases
The following tabl
a e provides information about shares repurchased during the fourth quarter of fiscal 2024:
Period
Total number
of shares
purchased(*)
Average price
paid per share
Total number of
shares purchased
as part of
publicly
announced plans
or programs
Approximate
dollar value of
remaining shares
that can be
purchased under
the plans or
programs
September 29, 2024 through October 26, 2024

$


$
598,966,271
October 27, 2024 through November 23, 2024
195
$
51.64

$
598,966,271
November 24, 2024 through December 28, 2024

$


$
598,966,271
Total
195

(*)
All the 195 shares purchased represent shares of our common stock surrendered by our employees to satisfy required tax withholding upon the vesting of
restricted stock awards between October 27, 2024 and November 23, 2024.
Share Repu
e
rchase Program
On Februa
r
ry 24, 2022, our Board of Directors authorized share repurchases up to $1.00 billion, inclusive of $301.9 million
remaining under previous authorizations. The total aggregate remaining capa
a
city under outstanding repurchase authorizations as
of December 28, 2024 was $599.0 million. The share repurchase authorizations have no expiration dates.
We repurchased and retired shares in open market transactions in the following amounts for the fiscal periods indicated:
Fiscal year ended
December 28, 2024
December 30, 2023
December 31, 2022
Number of shares repurchased(1)
736,423
1,446,269
3,747,187
Aggregate cost of shares repurchased (dol
d lars in thousands)s (2)
$
50,526
$
100,034
$
299,667
Average price per share(2)
$
68.61
$
69.17
$
79.97
(1)
Share repurchases were made in compliance with all applicable rules and regulations and in accordance with the share repurchase authorizations described
in Item 8, Financial Statements and Supplementary Data under Note 11, Common Stock, to the consolidated financial statements.
(2)
The aggregate cost of share repurchases and average price paid per share excludes excise tax on share repurchases imposed as part of the Inflation
Reduction Act of 2022.
The Company paused share repurchases during the third quarter of fiscal 2024. Future repurchases may occur from time to time
in the open market, in privately negotiated transactions, or otherwise. The timing and amount of any repurchases will be at the
discretion of the Company subj
u ect to restrictions under the Company
s secured revolving credit facility and considerations
given to market conditions, stock price, other investment priorities, excise taxes, and other factors.
Dividends
On Februa
r
ry 21, 2025, the Company
s Board of Directors declared a quarterly cash dividend payment of $0.80 per common
share, payabl
a e on March 28, 2025 to shareholders of record at the close of business on March 10, 2025.
In each quarter of fiscal 2024, the Board of Directors declared, and the Company paid, a cash dividend per common share of
$0.80 (for an aggregate cash dividend per common share of $3.20 for fiscal 2024). In fiscal 2023 the Board of Directors
declared, and the Company paid, a cash dividend per common share of $0.75 (for an aggregate cash dividend per common
31
Form 10-K

share of $3.00 for fiscal 2023). Our Board of Directors will evaluate future dividend declarations based on a number of factors,
including restrictions under our secured revolving credit facility, business conditions, our financial performance, and other
considerations.
Provisions in our secured revolving credit facility could have the effe
f ct of restricting our ability to pay cash dividends on, or
make future repurchases of,f our common stock, as further described in Item 8, Financial Statements and Suppl
u
ementary Data
under Note 10, Long-Term Debt, to the consolidated financial statements.
Recent Sales of Unregistered Securities
None.
ITEM 6. [RESERVED]
32

ITEM 7. MANAGEMENT
S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERAT
R
IONS
The following is a discussion of our results of operations and current financial condition. You should read this discussion in
conjunction with our consolidated historical financial statements and notes included elsewhere in this Annual Report on Form
10-K. Our discussion of our results of operations and financial condition contains certain forward-looking statements within the
meaning of the federal securities laws relating to our future performance. We based these statements on assumptions that we
consider reasonabl
a e. Actual results may differ materially from those suggested by our forward-looking statements for various
reasons including those discussed under Risk Factors in Part I, Item 1A of this Annual Report on Form 10-K. Those risk
factors expressly qualify
f all subs
u
equent oral and written forward-looking statements attributable to us or persons acting on our
behalf.f Except for any ongoing obligations to disclose material information as required by federal securities laws, we do not
have any intention or obligation to update forward-looking statements afte
f r we file this Annual Report on Form 10-K.
For a comparison of our results for fiscal year 2023 to our results for fiscal year 2022 and other financial information related to
fiscal year 2022, refer to Item 7 Management
s Discussion and Analysis of Financial Condition and Results of Operations in
our 2023 Annual Report on Form 10-K, filed with the SEC on Februa
r
ry 27, 2024.
Fiscal Years
Our fiscal year ends on the Saturday in December or January nearest December 31. Every
r five or six years, our fiscal year
includes an additional 53rd week of results. Fiscal 2024 ended on December 28, 2024, fiscal 2023 ended on December 30, 2023,
and fiscal 2022 ended on December 31, 2022. All three fiscal years contained 52 calendar weeks.
Our Business
We are the largest branded marketer of young children
s apparel in North America. We own two of the most highly recognized
and trus
r
ted brand names in the children
s apparel market, Carter
s and OshKos
K
h B
gosh (or OshKos
K
h). We also own Skip
Hop
o , a leading young children
s lifestyle brand, Little Planet, a brand focused on organic fabr
a
ics and sustainabl
a e materials and
exclusive Carter
s brands developed for Amazon, Target, and Walmart.
Our multichannel global business model, which includes retail stores, eCommerce, and wholesale distribution channels, as well
as omni-channel capa
a
bi
a lities in the United States and Canada, enables us to reach a broad range of consumers around the world.
At the end of fiscal 2024, our channels included 1,057 company-owned retail stores in North America, eCommerce websites,
approximately 19,500 wholesale locations in North America, as well as our international wholesale accounts and licensees who
operate in over 1,100 locations outside of North America in over 90 countries.
Segments
Our three business segments are: U.S. Retail, U.S. Wholesale, and International. These segments are our operating and
reporting segments. Our U.S. Retail segment consists of revenue primarily from sales of products in the United States through
our retail stores and eCommerce websites. Similarly, our U.S. Wholesale segment consists of revenue primarily from sales in
the United States of products to our wholesale customers. Our International segment consists of revenue primarily from sales of
products outside the United States, largely through our retail stores and eCommerce websites in Canada and Mexico, and sales
to our international wholesale customers and licensees. Additional financial and geographical information about our business
segments is contained in Item 8 Financial Statements and Suppl
u
ementary Data and under Note 18, Segm
e
ent Info
n rmation, to
the consolidated financial statements.
In fiscal 2024, the Company changed its measure of segment profita
f
bi
a lity to segment operating income. Segment operating
income includes net sales, royalty income, and related cost of goods sold and selling, general, and administrative expenses
attributable to each segment. Segment operating income excludes unallocated corporate expenses as well as specific charges
that are not directly attributable to segment operations, including restructur
t
ing costs and impairment charges related to goodwill
and indefinite-lived intangible assets, which were included in our previous measure of segment profita
f
bi
a lity. This change has no
impact on our consolidated operating income. Management believes this updated presentation more accurately reflects how the
business is managed and provides better insight into segment performance. Prior period segment operating income for the fiscal
year ended December 30, 2023 has been recast to confor
f
m to the current presentation.
Gross Profit
f
and Gross Margin
Gross profit
f
is calculated as consolidated net sales less cost of goods sold. Gross margin is calculated as gross profit
f
divided by
consolidated net sales. Cost of goods sold includes expenses related to the merchandising, design, and procurement of product,
including inbound freight, purchasing, receiving, and inspection costs. Also included in costs of goods sold are the costs of
33
Form 10-K

shipping eCommerce product to end consumers. Retail store occupa
u
ncy costs, distribution expenses, and generally all other
expenses other than interest and income taxes are included in Selling, general, and administrative (SG&A) expenses.
Distribution expenses that are included in SG&A primarily consist of payments to third-party shippers and handling costs to
process product through our distribution facilities, including eCommerce fulfillme
f
nt costs, and delivery
r to our wholesale
customers and to our retail stores. Our gross profit
f
and gross margin may not be comparable to other entities that define their
metrics differently.
Comparable Sales Metrics
We present comparable sales metrics because we consider them an important suppl
u
emental measure of our U.S. Retail and
International performance, and the Company uses such information to assess the performance of the U.S. Retail and
International segments. Additionally, we believe they are frequently used by securities analysts, investors, and other interested
parties in the evaluation of our business.
Our comparable sales metrics include sales for all stores and eCommerce sites that were open and operated by us during the
comparable fiscal period, including stand-alone format stores that converted to multi-branded format stores and certain
remodeled or relocated stores. A store or site becomes comparable following 13 consecutive full fiscal months of operations. If
a store relocates within the same center with no business interrupt
u ion or material change in square footage, the sales of such
store will continue to be included in the comparable store metrics. If a store relocates to another center more than five miles
away, or there is a material change in square footage, such store is treated as a new store. Stores that are closed during the
relevant fiscal period are included in the comparable store sales metrics up to the last full fiscal month of operations.
The method of calculating sales metrics varies across the retail industry.
r
As a result, our comparable sales metrics may not be
comparable to those of other retailers.
Known or Anticipated Trends
Macroeconomic Factor
t
sr and Consumer Demand
Macroeconomic factors, including persistent inflationary pressures on families with young children, elevated interest rates,
increased consumer debt levels, decreased savings rates, and geopolitical unrest continue to create a complex and challenging
retail environment. These macroeconomic factors have had and may continue to have a negative impact on consumer sentiment
and consumer demand for our products. In part due to these macroeconomic factors, our business has experienced a shiftf in
consumer demand from the retail channel to the mass channel. As consumers face financial pressures, U.S. Wholesale has
benefited from consumers choosing the ease of one-stop shopping availabl
a e through mass channel retailers. Additionally, we
have observed increased promotional activity across the retail industry,
r
which may negatively impact our financial results,
including revenue and operating margins in the future.
We have taken actions to mitigate the impact of decreased consumer demand, including strengthening our product offe
f rings
through a focus on style and value, increasing our mix of opening price and premium price offe
f rings, including through our
Little Planet brand and our PurelySoftf collection, optimizing our fleet of retail stores, improving our marketing effe
f ctiveness to
drive traffi
f c, including through the relaunch of our loyalty program in the second quarter of fiscal 2024, and investing in our
exclusive wholesale brands, our international omnichannel capa
a
bi
a lities, and the talent in our organization.
Additionally, in the second half of fiscal 2024, we made a strategic investment of approximately $65.0 million to strengthen the
value proposition of our direct-to-consumer product offe
f rings and drive improvements in customer acquisition, customer
retention, and brand awareness. This investment included $55.0 million allocated toward pricing to enhance competitiveness in
opening price point categories and to increase clearance velocity on prior season goods. This investment also included
$10.0 million allocated toward brand marketing. We believe these investments, combined with enhancements to the in-store and
online shopping experience, contributed to an improvement in U.S. Retail comparable sales, conversion rates (measured as the
percentage of store visitors and website traffi
f c that resulted in a purchase), transaction count, units sold, units per transaction,
and new customer acquisition in the second half of fiscal 2024 compared to the first half of fiscal 2024. We expect for our
strategic investments in pricing to continue through the first half of fiscal 2025.
Suppl
p yl Chain
i
The disrupt
r
ion of container shipping traffi
f c through the Red Sea affe
f cted transit times and shipping costs for product sourced
from our Asia manufac
f
turers beginning in fiscal 2024. The adverse impact of the disrupt
r
ions in the region, including additional
transportation fees to re-route these shipments, were approximately $6.5 million in fiscal 2024. While we do not believe we will
incur any material additional transportation costs related to the Red Sea conflic
f
t in fiscal 2025, if these hostilities continue or
escalate, our business and results of operations could be materially adversely affe
f cted.
34

Additionally, as a result of capa
a
city shortages with some of our carriers in Asia, we incurred approximately $5.2 million in
additional transportation costs in fiscal 2024, primarily attributable to surcharges on shipments and higher spot market rates
associated with the use of non-contractua
t
l carriers.
Despite these additional costs, our inbound freight input costs for fiscal 2024 were favorable to those incurred in fiscal 2023 by
approximately 20%. We anticipate an increase in ocean freight rates when our ocean freight contracts renew in the second
quarter of fiscal 2025. This increase is largely driven by ongoing capacity shortages related to Red Sea diversions by the
majo
a rity of cargo carriers whom have not resumed accessing the canal for most U.S. bound routes.
Recent Developments
Trade Policy
c
Recent developments in U.S. trade policy have introduc
d
ed uncertainty regarding the future of global trade relations. Following
the inauguration of the second Trum
r
p administration, there have been numerous announcements made and actions taken
related to tariff increases and other trade restrictions regarding imports into the U.S. Given that we source all of our apparel
and other products from a global network of third-party suppl
u
iersprimarily located in Asiaa
a
ny new or increased tariffs,
f
quotas, embargoes, or other trade barriers could impact our suppl
u
y chain and cost structur
t
e. Additionally, retaliatory measures
by affe
f cted countries, could further disrupt
r
our operations or reduce our competitiveness in international markets. We
continue to monitor these changing tariffs and trade restrictions. If new tariffs or trade restrictions are imposed, we may need
to adju
d st our pricing, increase inventory
r levels, or seek alternative suppl
u
iers, any of which could materially affe
f ct our revenue,
gross margins, and overall financial performance.
Executive Leadership Transitio
i
n
On January 3, 2025, subs
u
equent to the fiscal year ended December 28, 2024, Michael D. Casey retired as Chief Executive
Offi
f cer and Chairman of the Board of the Company. Mr. Casey
s retirement was not the result of any disagreement with the
Company on matters related to operations, policies, or practices. To ensure a smooth leadership transition, Mr. Casey will
continue to serve in an advisory capacity through Februa
r
ry 28, 2025.
Effe
f ctive January 5, 2025, Richard F. Westenberger, then serving as Senior Executive Vice President, Chief Financial Offi
f cer
and Chief Operating Offi
f cer, was appointed as Interim Chief Executive Offi
f cer. Mr. Westenberger will maintain his existing
responsibilities in addition to serving as our interim Chief Executive Offi
f cer while the Board of Directors continues the
process of identifying a permanent Chief Executive Offi
f cer.
Business Strategies and Outlook
We believe that our growth in the years ahead will be driven by our three key strategic priorities: elevating the style and value
of our product offe
f rings, improving our marketing capabilities and effe
f ctiveness, and leveraging our multichannel market
presence to extend the reach of our brands.
In U.S. Retail, we expect our growth will be driven by improvement in product assortment to highlight both our value-
oriented opening price product and our premium fashion assortment, investments in marketing which are intended to drive
traffi
f c, improve unaided awareness and increase new customer acquisition, and investments in store remodels that improve
customer experience and retention.
In U.S. Wholesale, we continue to expect growth to be driven by our exclusive Carter
s brands. Our wholesale channel has
benefited from increased traffi
f c to mass channel retailers as consumers have sought the convenience of one-stop shopping for
items such as groceries, other consumer packaged goods, and apparel.
In international markets, we expect our growth will be driven through our Canadian retail stores, new store openings in
Mexico, investments in marketing to improve traffi
f c, expansion through our wholesale partner in Brazil, and growth with
other wholesale customers.
Fiscal Year 2024 Financial Highlights
Unless otherwise stated, comparisons are to fiscal 2023.

Consolidated net sales decreased $101.5 million, or 3.4%, to $2.84 billion, driven by decreased U.S. Retail and
International sales.

Consolidated gross profit
f
decreased $30.8 million, or 2.2%, to $1.37 billion, driven by decreased net sales.
Consolidated gross margin increased 60 bps to 48.0%, driven by lower average cost per unit sold, customer mix, and
35
Form 10-K

decreased sales to low-margin off-p
f
rice wholesale channel customers, partially offs
f et by decreased average selling
prices per unit driven by investments in pricing.

Consolidated SG&A expenses increased $5.7 million, or 0.5%, to $1.10 billion. SG&A as a percentage of consolidated
net sales (SG&A rate) increased 160 bps to 38.7%, due to factors that include fixed cost deleverage on decreased
sales and investments in brand marketing and retail stores. We remain committed to effe
f ctively managing our variable
costs while strategically investing to drive business growth. These investments include strengthening our relationship
with consumers through more effe
f ctive marketing, and elevating our brand experience in collabor
a
ation with our
wholesale partners, and enhancing the customer experience in our retail stores.

Consolidated operating income decreased $68.7 million, or 21.2%, to $254.7 million, and adju
d sted operating income, a
non-GAAP financial measure, decreased $41.3 million, or 12.6%, to $286.6 million. Operating margin decreased 200
bps to 9.0%, primarily due to the factors discussed in detail below, including the recognition of a $30.0 million non-
cash pre-tax impairment charge related to the OshKos
K
h tradename in fiscal 2024.

Consolidated net income decreased $47.0 million, or 20.2%, to $185.5 million primarily due to the factors discussed in
detail below, including a $6.9 million court-approved settlement in fiscal 2023 that did not reoccur in fiscal 2024 and a
non-cash partial pension settlement charge of $0.9 million, partially offs
f et by a decrease in our income tax provision of
$24.4 million, an increase in interest income of $6.3 million, and a decrease in interest expense of $2.6 million.

Diluted net income per common share decreased $1.12, or 18.0%, to $5.12, and adju
d sted diluted net income per
common share decreased $0.38, or 6.1%, to $5.81.

Inventories decreased $34.8 million, or 6.5%, to $502.3 million, due to decreased days of suppl
u
y and lower average
unit costs.

We have continued to invest in the optimization of our fleet of U.S. Retail stores, including through opening new
stores, remodeling existing locations, and enhancing the in-store shopping experience. In fiscal 2024, we opened 41
stores and closed 29 stores in the United States. We are projecting approximately 30 new store openings and 19 store
closures in fiscal 2025, with a greater number of net store openings in future years.

As a result of our strong financial position and availabl
a e liquidity, we returned $166.7 million to our shareholders,
comprised of $116.2 million in cash dividends and $50.5 million in share repurchases.
36

RESULTS OF OPERAT
R
IONS
2024 FISCAL YEAR ENDED DECEMBER 28, 2024 COMPARED TO 2023 FISCAL YEAR ENDED DECEMBER 30,
2023
The following tabl
a e summarizes our results of operations:
Fiscal year ended
(dol
d lars in thousands, except per share data)
December 28, 2024
December 30, 2023
$ Change
% / bps Change
Consolidated net sales
$
2,844,102
$
2,945,594
$
(101,492)
(3.4)%
Cost of goods sold
1,478,936
1,549,659
(70,723)
(4.6)%
Gross profit
f
1,365,166
1,395,935
(30,769)
(2.2)%
Gross profit
f
as % of consolidat
d ed net sales
48.0 %
47.4 %
60 bps
Royalty income, net
19,251
21,410
(2,159)
(10.1)%
Roya
o
lty income as % of consolidat
d ed net sales
0.7 %
0.7 %
0 bps
Selling, general, and administrative expenses
1,099,689
1,093,940
5,749
0.5 %
SG&A expenses as % of consolidat
d ed net sales
38.7 %
37.1 %
160 bps
Intangible asset impairment
30,000

nm
nm
Operating income
254,728
323,405
(68,677)
(21.2)%
Operating income as % of consolidat
d ed net sales
9.0 %
11.0 %
(200)
(
bps
Interest expense
31,331
33,973
(2,642)
(7.8)%
Interest income
(11,039)
(4,776)
(6,263)
131.1 %
Other expense (income), net
3,627
(8,034)
11,661
nm
Income before income taxes
230,809
302,242
(71,433)
(23.6)%
Income tax provision
45,300
69,742
(24,442)
(35.0)%
Effe
f ctive tax
a rate(*)
*
19.6 %
23.1 %
(350)
(
bps
Net income
$
185,509
$
232,500
$
(46,990)
(20.2)%
Basic net income per common share
$
5.12
$
6.24
$
(1.12)
(18.0)%
Diluted net income per common share
$
5.12
$
6.24
$
(1.12)
(18.0)%
Dividend declared and paid per common share
$
3.20
$
3.00
$
0.20
6.7 %
(*)
Effective tax rate is calculated by dividing the provision for income taxes by income before income taxes.
Note: Results may
a not be additive due to rounding. Percentage changes consider
d
ed not meaningful
f
denoted with nm.
Consolidated Net Sales
Consolidated net sales decreased $101.5 million, or 3.4%, to $2.84 billion. The decrease in net sales was driven by lower traffi
f c
and demand in our U.S. Retail businesses, decreased sales of our Carter
s brand to wholesale customers, decreased sales to off-
f
price wholesale channel customers as a result of our lower excess inventory
r levels, decreased demand in our International
businesses, and decreased average selling prices per unit. These decreases were partially offs
f et by increased sales of our
exclusive Carter
s brands and growth from our retail stores in Mexico. Average selling prices per unit decreased by a mid-
single digit percentage, driven by investments in pricing. Units sold increased by a low-single digit percentage, driven by higher
volumes sold of our exclusive Carter
s brands. Changes in foreign currency exchange rates used for translation in fiscal 2024
had an unfav
f
orable effe
f ct on our consolidated net sales of $7.4 million.
Gross Profit
f
and Gross Margin
Consolidated gross profit
f
decreased $30.8 million, or 2.2%, to $1.37 billion and consolidated gross margin increased 60 bps to
48.0%. The decrease in consolidated gross profit
f
was driven by decreased net sales. The increase in consolidated gross margin
was driven by lower average cost per unit sold, customer mix, and decreased sales to low-margin off-p
f
rice wholesale channel
customers. Average cost per unit sold decreased by a mid-single digit percentage, driven by lower ocean freight rates and
product input costs, partially offs
f et by increased freight surcharges and costs to re-route our product around the Red Sea. These
factors were partially offs
f et by a benefit in excess inventory
r provisions in fiscal 2023 that did not reoccur in fiscal 2024,
decreased average selling prices per unit driven by investments in pricing, and an increase in the mix of U.S. Wholesale net
37
Form 10-K

sales. In fiscal 2025, we expect product input costs to increase by a low-single digit percentage and inbound transportation
rates, including ocean freight rates, to increase by a high-single digit percentage.
Royalty Income
We have licensing agreements with domestic and international licensees that grant licensees the right to access certain
trademarks in return for royalty payments or licensing fees. Royalty income decreased $2.2 million, or 10.1%, to $19.3 million,
driven by decreased wholesale customer demand.
Selling, General, and Administrative Expenses
Consolidated SG&A expenses increased $5.7 million, or 0.5%, to $1.10 billion in fiscal 2024 and SG&A rate increased 160 bps
to 38.7%. The increase in SG&A rate was driven by fixed cost deleverage on decreased sales, investments in our retail stores
and brand marketing, and increased charitabl
a e donations, partially offs
f et by decreased performance-based compensation
expense, decreased organizational restructur
t
ing costs, and decreased consulting costs. Performance-based compensation
expense as a percentage of net sales decreased 60 bps due to lower-than-planned financial performance in fiscal 2024.
Intangible Asset Impairment
Due to decreased actua
t
l and projected sales and profita
f
bi
a lity, the Company performed a quantitative impairment test on the
goodwill ascribed to each of the Company
s reporting units and on the value of its indefinite-lived intangible tradename assets
as of December 28, 2024. Based upon the results of the impairment test, we recognized a non-cash pre-tax impairment charge
of $30.0 million in the fourth quarter of fiscal 2024 related to our OshKos
K
h indefinite-lived tradename asset.
Operating Income
Consolidated operating income decreased $68.7 million, or 21.2%, to $254.7 million, and consolidated operating margin
decreased 200 bps to 9.0%, due to the factors discussed above.
Interest Expense
Consolidated interest expense decreased $2.6 million, or 7.8%, to $31.3 million due to a decrease in weighted-average
borrowings. Weighted-average borrowings were $500.0 million at an effe
f ctive interest rate of 6.23%, compared to weighted-
average borrowings for fiscal 2023 of $545.5 million at an effe
f ctive interest rate of 6.22%. The decrease in weighted-average
borrowings was attributable to decreased borrowings under our secured revolving credit facility.
Interest Income
Consolidated interest income increased $6.3 million to $11.0 million due to increased cash balances during the period.
Other Expense (Income), Net
Consolidated other expense (income), net increased $11.7 million to $3.6 million in fiscal 2024 due to a $6.9 million court-
approved settlement in fiscal 2023 that did not reoccur in fiscal 2024, a non-cash partial pension settlement charge of
$0.9 million, and unfav
f
orable changes in foreign currency exchange rates, primarily between the U.S. dollar and the Canadian
dollar and the Mexican peso.
Income Taxes
Our consolidated income tax provision decreased $24.4 million, or 35.0%, to $45.3 million, and the effe
f ctive tax rate decreased
350 bps to 19.6%. The decreased effe
f ctive tax rate relates to a lower proportion of income generated in the United States, where
the tax rate is higher relative to some of our international jurisdictions, compared to fiscal 2023.
Net Income
Consolidated net income decreased $47.0 million, or 20.2%, to $185.5 million, due to the factors previously discussed.
38

Results by Segment - Fiscal Year 2024 compared to Fiscal Year 2023
The following tabl
a e summarizes net sales by segment and segment operating income for the fiscal years ended December 28,
2024 and December 30, 2023:
Fiscal year ended
(dol
d lars in thousands)s
December 28, 2024
% of
consolidated
net sales
December 30, 2023
% of
consolidated
net sales
$ Change
% Change
Net sales:
U.S. Retail
$
1,417,108
49.8 % $
1,501,780
51.0 % $ (84,672)
(5.6)%
U.S. Wholesale
1,021,396
35.9 %
1,014,584
34.4 %
6,812
0.7 %
International
405,598
14.3 %
429,230
14.6 %
(23,632)
(5.5)%
Consolidated net sales
$
2,844,102
100.0 % $
2,945,594
100.0 % $ (101,492)
(3.4)%
Segment operating income(1):
Segment
operating
margin
Segment
operating
margin
U.S. Retail
$
132,926
9.4 % $
190,642
12.7 % $ (57,716)
(30.3)%
U.S. Wholesale
216,980
21.2 %
198,945
19.6 %
18,035
9.1 %
International
38,970
9.6 %
45,131
10.5 %
(6,161)
(13.7)%
Total segment
operating income
$
388,876
13.7 % $
434,718
14.8 % $ (45,842)
(10.5)%
Items not included in segment
operating income:
Consolidated
operating
margin
Consolidated
operating
margin
Unallocated corporate
expenses
(102,326)
n/a
(106,901)
n/a
(4,575)
(4.3)%
Intangible asset impairment
(30,000)
n/a

n/a
n/a
n/a
Organizational restructur
t
ing(2)
(1,822)
n/a
(4,412)
n/a
n/a
n/a
Consolidated operating income
$
254,728
9.0 % $
323,405
11.0 % $ (68,677)
(21.2)%
(1)
Segment operating income for the fiscal year ended December 30, 2023 has been recast to confor
f
m to the current presentation.
(2)
Relates to organizational restructur
t
ing for the fiscal year ended December 28, 2024 and organizational restructuring and related corporate offi
f ce lease
amendment actions for the fiscal year ended December 30, 2023. Organizational restructur
t
ing charges are reflected within Selling, general, and
administrative expenses in our consolidated statement of operations.
U.S. Retail
U.S. Retail segment net sales decreased $84.7 million, or 5.6%, to $1.42 billion. The decrease in net sales was driven by lower
traffi
f c in our eCommerce channels and in our retail stores, as well as decreased average selling prices per unit. Traffi
f c and
demand decreased, in part due to ongoing macroeconomic headwinds negatively impacting families with young children
including inflationary pressures, elevated interest rates, increased consumer debt levels, decreased savings rates, and
geopolitical unrest. Average selling prices per unit decreased by a mid-single digit percentage due to investments in our pricing
and an increased mix of clearance sales. Units sold decreased by a low-single digit percentage.
These factors were partially offs
f et by sales contribution of our new retail stores. Additionally, U.S. Retail saw an improved
trend in demand in the second half of fiscal 2024, compared to the first half of fiscal 2024, which we believe reflects the
positive impact of our investments in pricing and brand marketing, as well as our enhancements to the in-store and online
shopping experience. However, if these macroeconomic headwinds persist, the effe
f cts may continue to negatively impact our
financial results in fiscal 2025.
Comparable net sales, including retail stores and eCommerce, decreased 6.9%, driven by the factors mentioned above. As of
December 28, 2024, we operated 804 retail stores in the U.S. compared to 792 in fiscal 2023.
U.S. Retail segment operating income decreased $57.7 million, or 30.3%, to $132.9 million, due to a decrease in gross profit
f
of
$50.0 million and an increase in SG&A expenses of $6.6 million. Segment operating margin decreased 330 bps to 9.4%,
primarily driven by a 340 bps increase in SG&A rate. Gross margin was comparable to fiscal 2023 due to decreased average
39
Form 10-K

cost per unit sold and a benefit recorded in fiscal 2024 related to prior period freight expense, which was offs
f et by our
investments in pricing in the second half of fiscal 2024. Average cost per unit sold decreased by a mid-single digit percentage,
due to decreased inbound freight rates and product input costs. The increase in the SG&A rate was driven by fixed cost
deleverage on decreased net sales, investments in our retail stores and brand marketing, increased retail store rents and
employee compensation costs, and increased transportation costs, partially offs
f et by decreased performance-based
compensation expense.
U.S. Wholes
l
alel
U.S. Wholesale segment net sales increased $6.8 million, or 0.7%, to $1.02 billion, driven by growth in our exclusive Carter
s
brands and our Little Planet brand, offs
f etting lower seasonal demand for our Carter
s brands, decreased sales to low-margin
off-p
f
rice wholesale channel customers as a result of our lower excess inventory
r levels, and decreased average selling prices per
unit. We believe we are well positioned to benefit from consumer demand trends in the mass channel as a result of our strong
relationships and exclusive brands with Amazon, Target, and Walmart. Average selling prices per unit decreased by a mid-
single digit percentage due to investments in our pricing, while units sold increased by a mid-single digit percentage.
U.S. Wholesale segment operating income increased $18.0 million, or 9.1%, to $217.0 million, due to an increase of gross
profit
f
of $19.2 million, partially offs
f et by an increase in SG&A expenses of $0.6 million. Segment operating margin increased
160 bps to 21.2%, driven by a 170 bps increase in gross margin, partially offs
f et by a 10 bps increase in SG&A rate. The
increase in gross margin was due to decreased average cost per unit, partially offs
f et by a benefit in excess inventory
r provisions
in fiscal 2023 that did not reoccur in fiscal 2024 and decreased average selling prices per unit mentioned above. Average cost
per unit sold decreased by a high-single digit percentage due to decreased ocean freight rates and product input costs. The
increase in the SG&A rate was driven by investments in brand marketing, partially offs
f et by decreased performance-based
compensation expense and transportation costs.
Internatio
t nal
International segment net sales decreased $23.6 million, or 5.5%, to $405.6 million, driven by decreased net sales in Canada,
decreased demand from our international wholesale partners in the Middle East and Europe, decreased average selling prices
per unit, and a strengthening of the U.S. dollar against other foreign currencies, partially offs
f et by growth in our retail stores in
Mexico.
Demand in Canada was negatively affe
f cted by ongoing macroeconomic headwinds negatively impacting families with young
children, including inflationary pressures, elevated interest rates, and higher unemployment. However, we believe that our
investments in pricing and demand for colder weather outfitting contributed to an improved trend in demand in the second half
of fiscal 2024 compared to the first half of fiscal 2024.
Changes in foreign currency exchange rates, primarily between the U.S. dollar and the Canadian dollar and the U.S. dollar and
the Mexican peso, used for translation in fiscal 2024 had an unfav
f
orable effe
f ct on International segment net sales of $7.4
million. Average selling prices per unit decreased by a low-single digit percentage driven by our investment in pricing. Units
sold decreased by a low-single digit percentage.
Canadian comparable net sales, including retail stores and eCommerce, decreased 2.7%, driven by decreased traffi
f c in our
eCommerce channel and in our retail stores, in part due to macroeconomic headwinds. As of December 28, 2024, we operated
191 retail stores in Canada, compared to 188 at the end of fiscal 2023. As of December 28, 2024, we operated 62 retail stores in
Mexico, compared to 54 in fiscal 2023.
International segment operating income decreased $6.2 million, or 13.7%, to $39.0 million, driven by an increase in SG&A
expenses of $5.8 million. Segment operating margin decreased 90 bps to 9.6%, driven by a 360 bps increase in SG&A rate,
partially offs
f et by a 270 bps increase in gross margin. The increase in gross margin was due to decreased average cost per unit
sold, partially offs
f et by decreased selling prices per unit. Average cost per unit sold decreased by a high-single digit percentage
due to decreased ocean freight rates and product input costs. The increase in the SG&A rate was due to fixed cost deleverage on
decreased sales, investments in our retail stores in Mexico, and increased retail store employee compensation costs, partially
offs
f et by decreased performance-based compensation expense.
Unallo
l cated Corporatet Expe
x
nses
Unallocated corporate expenses include corporate overhead expenses that are not directly attributable to one of our business
segments and include unallocated accounting, finance, legal, human resources, and information technology expenses,
40

occupa
u
ncy costs for our corporate headquarters, and other benefit and compensation programs, including performance-based
compensation.
Unallocated corporate expenses decreased $4.6 million, or 4.3%, to $102.3 million in fiscal 2024. Unallocated corporate
expenses, as a percentage of consolidated net sales, was 3.6%, which was comparable to fiscal 2023. The decrease in consulting
costs and performance-based compensation expense was offs
f et by fixed cost deleverage on decreased sales, increased charitable
donations, and increased brand management costs.
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES TO GAAP MEASURES
We have provided non-GAAP adju
d sted operating income, income taxes, net income, and diluted net income per common share
measures, which exclude certain items presented below. We believe that this information provides a meaningful
f
comparison of
our results and affo
f
rds investors a view of what management considers to be our core performance, and we also, from time to
time, use some of these non-GAAP measures, such as adju
d sted operating income, as performance metrics in awards under our
annual and long-term incentive compensation plans. These measures are not in accordance with, or an alternative to, generally
accepted accounting principles in the U.S. (GAAP). The most comparable GAAP measures are operating income, income tax
provision, net income, and diluted net income per common share, respectively. Adju
d sted operating income, income taxes, net
income, and diluted net income per common share should not be considered in isolation or as a subs
u
titute for analysis of our
results as reported in accordance with GAAP. Other companies may calculate adju
d sted operating income, income taxes, net
income, and diluted net income per common share differently than we do, limiting the useful
f ness of the measure for
comparisons with other companies.
Fiscal year ended
December 28, 2024
December 30, 2023
(In millions, except
earnings per share)
Operating
Income
% Net
Sales
Income
Taxes
Net
Income
Diluted
Net
Income
per
Common
Share
Operating
Income
% Net
Sales
Income
Taxes
Net
Income
Diluted
Net
Income
per
Common
Share
As reported
(GAAP)
$
254.7
9.0 % $
45.3
$ 185.5
$
5.12
$
323.4
11.0 % $
69.7
$
232.5
$
6.24
Organizational
restructur
t
ing(1)
1.8
0.2
1.6
0.04
4.4
1.0
3.4
0.09
Intangible asset
impairment(2)
30.0
7.2
22.8
0.63




Partial pension plan
settlement(3)

0.2
0.7
0.02




Legal settlement(4)





(1.7)
(5.3)
(0.14)
As adju
d
sted
$
286.6
10.1 % $
52.9
$ 210.7
$
5.81
$
327.8
11.1 % $
69.1
$
230.6
$
6.19
(1)
Related to charges for organizational restructur
t
ing in the fiscal year ended December 28, 2024 and organizational restructur
t
ing and related corporate
offi
f ce lease amendment actions in the fiscal year ended December 30, 2023.
(2)
Related to a non-cash impairment charge on the OshKos
K
h indefinite-lived tradename asset in the fiscal year ended December 28, 2024.
(3)
Related to a non-cash partial pension settlement charge in the fiscal year ended December 28, 2024.
(4)
In fiscal 2023, a pre-tax adju
d stment of $6.9 million ($5.3 million net of tax, or $0.14 per diluted share) was made related to a gain on a court-approved
settlement in December 2023.
Note: Results may
a not be additive due to rounding.
LIQUIDITY AND CAPITAL RESOURCES
Our ongoing cash needs are primarily for working capi
a tal (consisting primarily of inventory)
r
, capital expenditures, employee
compensation, interest on debt, the return of capital to our shareholders, and other general corporate purpos
r
es. We expect that
our primary sources of liquidity will be cash and cash equivalents on hand, cash flow from operations, and availabl
a e borrowing
capacity under our secured revolving credit facility. We believe that our sources of liquidity are sufficient to meet our cash
requirements for at least the next twelve months. However, these sources of liquidity may be affe
f cted by events described in the
Forward-Looking Statements section, in our risk factors, as discussed under the heading Risk Factors in Part I, Item 1A of
this Annual Report on Form 10-K, and in other reports filed with the Securities and Exchange Commission from time to time.
41
Form 10-K

As discussed under the heading Know
K
n or Anticipated Trends in Part II, Item 7 of this Annual Report on Form 10-K,
macroeconomic factors have had a negative impact on consumer sentiment and consumer demand for our products. Continued
pressure on consumer sentiment in fiscal 2025 may have an adverse impact on financial results in fiscal 2025. We cannot
predict the timing and amount of such impact.
As of December 28, 2024, we had $412.9 million of cash and cash equivalents held at majo
a r financial institutions, including
$75.3 million held at financial institutions located outside of the United States. We maintain cash deposits with majo
a r financial
institutions that exceed the insurance coverage limits provided by the Federal Deposit Insurance Corporation in the United
States and by similar insurers for deposits located outside the United States. To mitigate this risk, we utilize a policy of
allocating cash deposits among majo
a r financial institutions that have been evaluated by us and third-party rating agencies as
having acceptabl
a e risk profil
f es.
Balance Sheet
Net accounts receivabl
a e at December 28, 2024 were $194.8 million compared to $183.8 million at December 30, 2023. The
increase of $11.1 million, or 6.0%, primarily reflects the timing of wholesale customer shipments and payments.
Inventories at December 28, 2024 were $502.3 million compared to $537.1 million at December 30, 2023. The decrease of
$34.8 million, or 6.5%, was due to decreased days of suppl
u
y and lower average unit costs. We are currently experiencing stable
inventory
r levels, inventory
r transit times, and flow of seasonal product in line with our historical experience.
Operating lease assets at December 28, 2024 were $577.1 million compared to $528.4 million at December 30, 2023. The
increase of $48.7 million, or 9.2% in operating lease assets was driven by the renewal of a contract with a third-party logistics
provider in Califor
f
nia for warehousing and distribution purpos
r
es and investments in our retail store fleet.
Accounts payabl
a e at December 28, 2024 were $248.2 million compared to $242.1 million at December 30, 2023. The increase
of $6.1 million, or 2.5%, is driven by the timing of payments for purchases of inventory.
r
Cash Flow
Net Cash Provided
d
by Operatin
t
g Activities
Net cash provided by operating activities decreased $230.3 million, or 43.5%, to $298.8 million. Our cash flow provided by
operating activities is driven by net income and changes in our net working capital. The decrease in operating cash flow was
driven by smaller reductions in inventory
r balances due to the sell through of a large portion of prior season inventory
r in fiscal
2023 and decreased net income.
Net Cash Used in Investin
t
g Activities
Net cash used in investing activities decreased $3.7 million, or 6.2%, to $56.2 million. This decrease in net cash used in
investing activities is driven by decreased capital expenditures. Capi
a tal expenditures in fiscal 2024 were primarily related to
U.S. and international retail store openings and remodels and investments in our distribution facilities. We plan to invest
approximately $65 million in capi
a tal expenditures in fiscal 2025, which primarily relates to U.S. and international retail store
openings and remodels, investments in our distribution facilities, and strategic information technology initiatives.
Net Cash Used in Fina
i
ncing Activities
Net cash used in financing activities decreased $157.8 million, or 47.4%, to $174.8 million. This change in cash flow used in
financing activities was primarily driven by decreased common stock share repurchases and by payments on our secured
revolving credit facility in fiscal 2023 that did not reoccur in fiscal 2024.
Share Repurchases
On Februa
r
ry 24, 2022, our Board of Directors authorized share repurchases up to $1.00 billion, inclusive of $301.9 million
remaining under previous authorizations. The total remaining capacity under outstanding repurchase authorizations as of
December 28, 2024 was approximately $599.0 million, based on settled repurchase transactions. The share repurchase
authorizations have no expiration dates.
In fiscal 2024, we repurchased and retired 736,423 shares in open market transactions for $50.5 million, at an average price of
$68.61 per share. In fiscal 2023, we repurchased and retired 1,446,269 shares in open market transactions for $100.0 million, at
an average price of $69.17 per share.
42

The Company paused share repurchases during the third quarter of fiscal 2024. Future repurchases may occur from time to time
in the open market, in privately negotiated transactions, or otherwise. The timing and amount of any repurchases will be at the
discretion of the Company subj
u ect to restrictions under the Company
s secured revolving credit facility and considerations
given to market conditions, stock price, other investment priorities, excise taxes, and other factors.
Dividends
On Februa
r
ry 21, 2025, the Company
s Board of Directors declared a quarterly cash dividend payment of $0.80 per common
share, payabl
a e on March 28, 2025 to shareholders of record at the close of business on March 10, 2025.
In each quarter of fiscal 2024, the Board of Directors declared, and the Company paid, a cash dividend per common share of
$0.80 (for an aggregate cash dividend per common share of $3.20 for fiscal 2024).
                          In
0 for fiscal 2024).
fiscal 2023, the Board of Directors
declared, and the Company paid, a cash dividend per common share of $0.75 (for an aggregate cash dividend per common
share of $3.00 for fiscal 2023). Our Board of Directors will evaluate future dividend declarations based on a number of factors,
including restrictions under our secured revolving credit facility, business conditions, our financial performance, and other
considerations.
Provisions in our secured revolving credit facility could have the effe
f ct of restricting our ability to pay cash dividends on, or
make future repurchases of,f our common stock, as further described in Item 8, Financial Statements and Suppl
u
ementary Data
under Note 10, Long-Term Debt, to the consolidated financial statements.
Financing Activities
Secured Revolving Credit
d
Facility
i
As of December 28, 2024, we had no outstanding borrowings under our secured revolving credit facility, exclusive of $4.7
million of outstanding letters of credit. As of December 30, 2023, we had no outstanding borrowings under our secured
revolving credit facility, exclusive of $4.4 million of outstanding letters of credit. As of December 28, 2024 and December 30,
2023, there was $845.3 million and $845.6 million availabl
a e for future borrowing, respectively. Any outstanding borrowings
under our secured revolving credit facility are classified as non-current liabi
a lities on our consolidated balance sheets due to
contractua
t
l repayment terms under the credit facility. However, these repayment terms also allow us to repay some or all of the
outstanding borrowings at any time.
Terms of the Secured Revolving Credit Facility
Our secured revolving credit facility provides for an aggregate credit line of $850 million which includes a $750 million U.S.
dollar facility and a $100 million multicurrency facility. The credit facility matures in April 2027. The facility contains
covenants that restrict the Company
s ability to, among other things: (i) create or incur liens, debt, guarantees or other
investments, (ii) engage in mergers and consolidations, (iii) pay dividends or other distributions to, and redemptions and
repurchases from, equity holders, (iv) prepay, redeem or repurchase subor
u
dinated or junior debt, (v) amend organizational
documents, and (vi) engage in certain transactions with affi
f liates.
Our secured revolving credit facility provides for a leverage-based pricing grid which determines an interest rate for
borrowings, calculated as the applicable floating benchmark rate plus a credit spread adju
d stment, if any, plus an amount ranging
from 1.125% to 1.625% based on leverage. As of December 28, 2024, the borrowing rate for an adju
d sted term Secured
Overnight Financing Rate (SOFR) loan would have been 5.58%, which includes a leverage-based adju
d stment of 1.125%.
There were no borrowings in fiscal 2024. Weighted-average borrowings were $45.6 million for fiscal 2023.
As of December 28, 2024, the Company was in compliance with the financial and other covenants under the secured revolving
credit facility.
Senior Notes
As of December 28, 2024, TWCC had $500.0 million principal amount of senior notes outstanding, bearing interest at a rate of
5.625% per annum, and maturing on March 15, 2027. On our consolidated balance sheet, the $500.0 million of outstanding
senior notes as of December 28, 2024 is reported net of $1.9 million of unamortized issuance-related debt costs, and the $500.0
million of outstanding senior notes as of December 30, 2023 is reported net of $2.6 million of unamortized issuance-related
debt costs. TWCC may redeem all or part of the senior notes at a redemption price of 100% of the principal amount of the
senior notes, plus accrued and unpaid interest.
43
Form 10-K

The senior notes mentioned above are unsecured and are fully and unconditionally guaranteed by Carter
s, Inc. and certain
domestic subs
u
idiaries of TWCC. The guarantor subs
u
idiaries are 100% owned directly or indirectly by Carter
s, Inc. and all
guarantees are joint, several and unconditional.
The indentur
t
es governing the senior notes provides that upon the occurrence of specific kinds of changes of control, unless a
redemption notice with respect to all the outstanding senior notes has previously or concurrently been mailed or delivered, we
will be required to make an offe
f r to purchase the senior notes at 101% of their principal amount, plus accrue
r
d and unpaid
interest to (but excluding) the date of purchase.
The indentur
t
es governing the senior notes include a number of covenants, that, among other things and subj
u ect to certain
exceptions, restrict TWCC
s ability and the ability of certain of its subs
u
idiaries to: (a) incur certain types of indebtedness that is
secured by a lien; (b) enter into certain sale and leaseback transactions; and (c) consolidate or merge with or into, or sell
subs
u
tantially all of the issuer
s assets to, another person, under certain circumstances. Terms of the notes contain customary
r
affi
f rmative covenants and provide for events of default which, if certain of them occur, would permit the trus
r
tee or the holders
of at least 25.0% in principal amount of the then total outstanding senior notes to declare all amounts owning under the notes to
be due and payabl
a e. Carter
s, Inc. is not subj
u ect to these covenants.
Contractual Obligations and Commitments
We enter into contractua
t
l obligations and commitments in the ordinary course of business that may require future cash
payments. Such obligations include: 1) debt repayments and letters of credit (as described in Item 8, Financial Statements and
Suppl
u
ementary Data under Note 10, Long-Term Debt, to the consolidated financial statements), 2) operating lease liabi
a lities
(as described in Item 8, Financial Statements and Suppl
u
ementary Data under Note 5, Leases, to the consolidated financial
statements) and 3) liabilities related to employee benefit plans (as described in Item 8, Financial Statements and
Suppl
u
ementary Data under Note 17, Empl
m oyee Benefit
e
Plans, to the consolidated financial statements).
In addition, we have commitments to purchase inventory
r in the normal course of business, which are cancellabl
a e (with or
without penalty, depending on the stage of production) and span a period of one year or less. As of December 28, 2024, our
estimate for commitments to purchase inventory
r was between $450 million and $550 million.
We are unabl
a e to reasonabl
a y predict future reserves for income taxes, as these are contingent on the ultimate amount or timing
of settlement.
Liquidity Outlook
Based on our current outlook, we believe that cash and cash equivalents on hand, cash flow generated from operations, and
availabl
a e borrowing capacity under our secured revolving credit facility will be adequate to meet our working capi
a tal needs and
capital expenditure requirements for our longer-term strategic plans, although no assurance can be given in this regard.
Seasonality
We experience seasonal fluctuations in our sales and profit
f ability due to the timing of certain holidays and key retail shopping
periods, which generally has resulted in lower sales and gross profit
f
in the first half of our fiscal year versus the second half of
the fiscal year. Accordingly, our results of operations during the first half of the year may not be indicative of the results we
expect for the full year.
CRITICAL ACCOUNTING POLICIES AND ESTIMATES
Our discussion and analysis of our financial condition and results of operations are based upon our consolidated financial
statements, which have been prepared in accordance with accounting principles generally accepted in the United States of
America. The preparation of these financial statements requires us to make estimates and judgments that affe
f ct the reported
amounts of assets, liabilities, revenues, expenses, and related disclosure of contingent assets and liabi
a lities. We base our
estimates on historical experience and on various other assumptions that we believe are reasonabl
a e under the circumstances, the
results of which form the basis for making judgments about the carrying values of assets and liabi
a lities that are not readily
apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.
Our significant accounting policies are described in our accompanying consolidated financial statements. The following
discussion addresses our critical accounting policies and estimates, which are those policies that require management
s most
difficult and subj
u ective judgments, ofte
f n as a result of the need to make estimates about the effe
f ct of matters that are inherently
uncertain.
44

Revenue Recognition and Accounts Receivable Allowance
Our revenues, which are reported as Net sales, consist of sales to customers, net of returns, discounts, chargebacks, and
cooperative advertising. We recognize revenue when (or as) the performance obligation is satisfied. Generally, the performance
obligation is satisfie
f d when we transfer
f
control of the goods to the customer.
Our retail store revenues, also reported as Net sales, are recognized at the point of sale. Retail sales through our online channels
are recognized at time of delivery to the customer. Revenue from omni-channel sales, including buy-online and pick-up in-
store, buy-online, ship-to-store, and buy-online, deliver-from-store, are recognized when the product has been picked up by the
customer at the store or when the product is physically delivered to the customer. We recognize retail sales returns at the time of
transaction by recording adju
d stments to both revenue and cost of goods sold. Additionally, we maintain an asset, representing
the goods we expect to receive from the customer, and a liabi
a lity for estimated sales returns. There are no accounts receivable
associated with our retail customers.
Our accounts receivabl
a e reserves for wholesale customers include an allowance for expected credit losses and an allowance for
chargebacks. The allowance for expected credit losses includes estimated losses resulting from the inability of our customers to
make payments. If the financial condition of a customer were to deteriorate, resulting in an impairment of its ability to make
payments, an additional allowance could be required. Our credit and collections department reviews all past due balances
regularly. Account balances are charged offf against the allowance when it is probabl
a e that the receivabl
a e will not be recovered.
The allowance for chargebacks is based on historical experience and includes estimated losses resulting from pricing
adju
d stments, short shipments, handling charges, returns, and freight. Provisions for the allowance for expected credit losses are
reflected in Selling, general and administrative expenses on our consolidated statement of operations and provisions for
chargebacks are reflected as a reduction in Net sales on our consolidated statement of operations.
Cooperative advertising arrangements reimburse customers for marketing activities for certain of our products. For
arrangements in which the Company receives a distinct good or service, we record these reimbursements under cooperative
advertising arrangements with certain of our majo
a r wholesale customers at fair value. Fair value is determined based upon,
among other factors, comparable market analysis for similar advertisements when fair value is determinable. We have included
the fair value of these arrangements of $0.9 million for fiscal 2024 and $0.6 million for fiscal 2022 as a component of SG&A
expenses on the Company
s consolidated statements of operations, rather than as a reduction of Net sales. There were no
amounts for cooperative advertising arrangements recorded as a component of SG&A expenses for fiscal 2023. Amounts
determined to be in excess of the fair value of these arrangements are recorded as a reduction of net sales. For arrangements in
which the Company does not receive a distinct good or service, we record these reimbursements as a reduction of net sales. The
majo
a rity of the Company
s digital cooperative advertising arrangements are recorded as a reduction of net sales as there was no
distinct good or service received by the Company.
Except in very limited circumstances, we do not allow our wholesale customers to return goods to us.
Inventory
Our inventories, which consist primarily of finished goods, are stated approximately at the lower of cost (first-in, first-out basis
for wholesale inventory
r and average cost for retail inventories) or net realizable value. Obsolete, damaged, and excess inventory
r
is carried at net realizable value by establ
a ishing reserves afte
f r assessing historical recovery rates, current market conditions, and
future marketing and sales plans. Rebates, discounts and other cash consideration received from a vendor related to inventory
r
purchases are reflected as reductions in the cost of the related inventory
r item and are therefor
f
e reflected in Cost of goods sold
when the related inventory
r item is sold.
The Company also has minimum inventory
r purchase commitments, including fabr
a
ic commitments, with our suppl
u
iers which
secure a portion of our raw material needs for future seasons. In the event anticipated market sales prices are lower than these
committed costs or customer orders are canceled, the Company records an estimated liabi
a lity reserve for these adverse
inventory
r and fabr
a
ic purchase commitments. Increases to this reserve are reflected in Costs of goods sold on our consolidated
statement of operations.
Impairment of Goodwill and Other Indefinite-Lived Intangible Assets
The carrying values of the goodwill and indefinite-lived tradename assets are subj
u ect to annual impairment reviews which are
performed as of the last day of each fiscal year. Additionally, a review for potential impairment is performed whenever
significant events or changes in circumstances indicate that the carrying value of the assets may not be recoverabl
a e. The
impairment models included in our analysis utilize significant estimates and assumptions to determine asset fair values. A
45
Form 10-K

deterioration of macroeconomic factors may negatively impact these estimates and assumptions and result in future impairment
charges.
Goodwill
The Company performs impairment tests of its goodwill at the reporting unit level. Qualitative and quantitative methods are
used to assess for impairment, including the use of discounted cash flows (income approach) and relevant data from guideline
public companies (market approach).
Under a qualitative assessment, we estimate if it is more likely than not that the fair value of the reporting unit is less than its
carrying value. Qualitative factors may include but are not limited to: macroeconomic conditions; industry
r and market
considerations; cost factors that may have a negative effe
f ct on earnings; overall financial performance; and other relevant
entity-specific events. If the results of a qualitative test determine that it is more likely than not that the fair value of a
reporting unit is less than its carrying value, then a goodwill impairment test using quantitative assessments must be performed.
If it is determined that it is not more likely than not that the fair value of the reporting unit is less than its carrying value, then
no further testing is required.
Under a quantitative assessment for goodwill, we compare the fair value of a reporting unit to its carrying value, including
goodwill. We use a 50% weighting of the income approach and a 50% weighting of the market approach to determine the fair
value of a reporting unit. The assumptions used in these approaches include revenue growth and profita
f
bi
a lity, terminal growth
rates, discount rates, market multiples, and an implied control premium. Discount rates are dependent upon interest rates and
the cost of capital at a point in time. These assumptions are consistent with those we believe hypothetical marketpl
t ace
participants would use. An impairment is recorded for any excess carrying value above the fair value of the reporting unit, not
to exceed the carrying value of goodwill.
In fiscal 2024, the Company perfor
f
med a quantitative impairment test on the goodwill ascribed to each of the Company
s
reporting units and on the value of its indefinite-lived intangible tradename assets as of December 28, 2024. Based upon this
assessment, there were no impairments on the value of goodwill.
As of December 28, 2024, goodwill allocated to the Canada reporting unit was $36.8 million. The most recent assessment
indicated that the fair value of assets for the Canada reporting unit exceeded its carrying value by approximately 13%.
Sensitivity tests on the Canada reporting unit showed that a 100 basis point increase in the discount rate or a 100 basis point
decrease in the long-term revenue growth rate would not change the conclusion and would not result in an impairment charge.
However, a 100 basis point decrease in the revenue growth rates would indicate an goodwill impairment charge of
approximately $7 million of the Canada reporting unit. Although the Company determined that no impairment exists for the
Canada reporting unit, goodwill ascribed to the Canada reporting unit could be at risk for impairment should macroeconomic
factors, including declining consumer sentiment, continue to adversely affe
f ct the Company
s financial results.
Indefi
e ni
i
te
i -Lived Intangible Assets
A tradename is considered impaired if the estimated fair value of the tradename is less than the carrying amount. Impairment
reviews for an indefinite-lived tradename can be conducted using qualitative analysis, and if necessary, by a quantitative
impairment test. If a tradename is considered impaired, we recognize a loss equal to the difference between the carrying amount
and the estimated fair value of the tradename. The process of estimating the fair value of a tradename incorporates the relief-f
from-royalty valuation method, which requires us to make assumptions and to apply judgment, including forecasting revenue
growth and profit
f ability and selecting the appropriate terminal growth rate, discount rate, and royalty rate.
As discussed above, the Company performed quantitative impairment assessments on the value of the Company
s indefinite-
lived intangible tradename assets as of December 28, 2024. Based on these assessments, a non-cash pre-tax impairment charge
of $30.0 million was recorded during the fourth quarter of fiscal 2024 on our indefinite-lived OshKos
K
h tradename asset to write-
down the carrying value to $40.0 million. This impairment charge was the result of decreased actual and projected sales and
profita
f
bi
a lity for our OshKos
K
h brand. Sensitivity tests on the OshKos
K
h indefinite-lived tradename asset showed that a 100 basis
point increase in the discount rate, a 500 basis point decrease in the revenue growth rate, or a 50 basis point decrease in the
royalty rate would result in further impairment charges of approximately $5 million, $10 million, and $20 million, respectively.
Impairment of Other Long-Lived Assets
We review other long-lived assets, including right of use (ROU) lease assets, property, plant, and equipment, definite-lived
tradename assets, and customer relationship assets, for impairment whenever events or changes in circumstances indicate that
the carrying amount of such an asset may not be recoverabl
a e. To determine whether there has been a permanent impairment on
46

such assets, a recoverabi
a lity test is performed by comparing anticipated undiscounted future cash flows from the use and
eventual disposition of the asset or asset group to the carrying value of the asset. If the undiscounted cash flows are less than the
related carrying value of the other long-lived asset, they are written down to their fair value. The process of estimating the fair
value requires us to make assumptions and to apply judgment including forecasting revenue growth and profita
f
bi
a lity, utilizing
external market participant assumptions, including estimated market rents, and selecting the appropriate discount rate. Long-
lived assets that meet the definition of held for sale will be valued at the lower of carrying amount or fair value, less costs to
sell.
We review all stores leases that have been opened for greater than 14 months for impairment on at least an annual basis, or
sooner if circumstances so dictate. In determining undiscounted future cash flows for the recoverabi
a lity test of store leases, we
take various factors into account, including the continued market acceptance of our current products, the development of new
products, changes in merchandising strategy, retail store cost controls, store traffi
f c, competition, and the effe
f cts of
macroeconomic factors such as consumer spending. In determining the fair value of store leases, we utilize external market
participant assumptions, including market rents per square foot and market rent growth rates.
A deterioration of macroeconomic factors may not only negatively impact the estimated future cash flows used in our cash flow
models but may also negatively impact other assumptions used in our analysis, including, but not limited to, the estimated
discount rates. Changes in these estimates and assumptions may have a significant impact on our assessment of fair value and
result in future impairment charges.
Accrued Expenses
Accrue
r
d expenses for workers
 compensation, incentive compensation, health insurance, 401(k), and other outstanding
obligations are assessed based on actua
t
l commitments, statistical trends, and/or estimates based on projections and current
expectations, and these estimates are updated periodically as additional information becomes availabl
a e.
Loss Contingencies
We record accrua
r
ls for various contingencies including legal exposures as they arise in the normal course of business. We
determine whether to disclose and accrue
r
for loss contingencies based on an assessment of whether the risk of loss is remote,
reasonabl
a y possible, or probabl
a e and whether the loss can be reasonabl
a y estimated. Our assessment is developed in consultation
with our internal and external counsel and other advisers and is based on an analysis of possible outcomes under various
strategies. Loss contingency assumptions involve judgments that are inherently subj
u ective and can involve matters that are in
litigation, which, by their nature are unpredictabl
a e. We believe that our assessment of the probabi
a lity of loss contingencies is
reasonabl
a e.
Accounting For Income Taxes
As part of the process of preparing the accompanying consolidated financial statements, we are required to estimate our actual
current tax exposure (state, federal, and foreign). We assess our income tax positions and record tax benefits for all years
subj
u ect to examination based upon management
s evaluation of the facts, circumstances, and information availabl
a e at the
reporting dates. We recognize the tax benefit from an uncertain tax position only if it is more likely than not that the tax
position will be sustained on examination by the taxing authorities, based on the technical merits of the position. If it is more
likely than not that a tax position would not be sustained, then no tax benefit would be recognized. Where applicable, associated
interest related to unrecognized tax benefits is recognized as a component of interest expense and associated penalties related to
unrecognized tax benefits are recognized as a component of income tax expense.
We also assess permanent and temporary
r differences resulting from differing basis and treatment of items for tax and
accounting purpos
r
es, such as the carrying value of intangibles, deductibility of expenses, depreciation of property, plant, and
equipment, stock-based compensation expense, and valuation of inventories. Temporary
r differences result in deferred tax assets
and liabi
a lities, which are included within our consolidated balance sheets. We must then assess the likelihood that our deferred
tax assets will be recovered from future taxabl
a e income. Actual results could differ from this assessment if sufficient taxabl
a e
income is not generated in future periods. To the extent we determine the need to establ
a ish a valuation allowance or increase
such allowance in a period, we must include an expense within the tax provision in the accompanying consolidated statements
of operations.
Based on our results for fiscal 2024, a hypothetical 1% increase in our effe
f ctive tax rate would have resulted in an increase in
our income tax expense of $2.3 million.
47
Form 10-K

Employee Benefit Plans
We sponsor a frozen defined benefit pension plan and other unfunde
f
d post-retirement plans. The defined benefit pension and
post-retirement plans require an actua
t
rial valuation to determine plan obligations and related periodic costs. Plan valuations
require economic assumptions, including expected rates of return on plan assets, discount rates to value plan obligations and
employee demographic assumptions including mortality rates. Plan valuations based on the actua
t
rial assumptions used may
differ materially from actua
t
l results due to changing market and economic conditions. Actual results that differ from the plan
valuations are reflected as deferred gains and losses in Accumulated other comprehensive income (loss) within shareholder
s
equity. Deferred gains and losses that exceed 10% of the greater of the plan
s projected benefit obligations or market value of
assets are amortized to earnings over the average remaining life of inactive plan participants.
Any future obligation under our pension plan not funded from returns on plan assets is expected to be funded from cash flows
from operations.
The most significant assumption used to determine the Company
s projected benefit obligation under its defined benefit plans is
the discount rate. For further details on rates and assumptions, see Item 8, Financial Statements and Suppl
u
ementary Data
under Note 17, Empl
m oyee Benefit
e
Plans, to the consolidated financial statements.
Stock-Based Compensation Arrangements
We recognize the cost resulting from all stock-based compensation arrangements in the financial statements at grant date fair
value. The fair value of stock awards (other than market-based restricted stock awards) is determined based on the quoted
closing price of our common stock on the date of grant. Our market-based awards are subj
u ect to vesting conditions based on the
performance of the Company
s total shareholder return (TSR) relative to the TSR of a select group of peer companies over
the three-year period. The fair value of market-based restricted stock awards is determined based on a Monte-Carlo simulation
valuation model, which requires the use of subj
u ective assumptions including the expected volatility of our stock price, the
expected volatility of the peer group
s stock prices, the correlation of our stock price and those of the peer group, the risk-fre
f e
interest rate, and the expected dividend yield. The fair value of stock options is determined based on the Black-Scholes option
pricing model, which requires the use of subj
u ective assumptions. There have been no issuances of stock options since 2018, and
there are no unrecognized compensation costs remaining on outstanding stock options.
Subj
u ective assumptions also include a forfeiture rate assumption for all restricted stock awards and an estimate for the
probabi
a lity that the performance criteria will be achieved for perfor
f
mance-based restricted stock awards. We estimate
forfeitures of restricted stock awards based on historical experience and expected future activity. We account for performance-
based awards over the vesting term of the awards that are expected to vest based on whether it is probabl
a e that the performance
criteria will be achieved. We reassess the probabi
a lity of vesting at each reporting period for awards with performance criteria
and adju
d st stock-based compensation expense based on the probabi
a lity assessments.
Changes in the subj
u ective assumptions can materially affe
f ct the estimate of fair value of stock-based compensation and,
consequently, the related amount recognized in the accompanying consolidated statements of operations.
During the requisite service period, we recognize a deferred income tax benefit for the expense recognized for U.S. GAAP. At
time of subs
u
equent vesting, exercise, forfeiture, or expiration of an award, the difference between our actua
t
l income tax
deduction, if any, and the previously accrue
r
d income tax benefit is recognized in our income tax expense/be
/
nefit during the
current period.
ITEM 7A.QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Currency and Interest Rate Risks
In the operation of our business, we have market risk exposures including those related to foreign currency risk and interest
rates. These risks, and our strategies to manage our exposure to them, are discussed below.
Currency
c Risk
i
We contract to purchase product from third parties, primarily in Asia. While these contracts are stated in U.S. dollars, there can
be no assurance that the cost for the future production of our products will not be affe
f cted by exchange rate fluctuations
between the U.S. dollar and the local currencies of these contracted manufact
f
ur
t
ers. Due to the number of currencies involved,
we cannot quantify
f the potential impact that future currency fluctuations may have on our results of operations in future
periods.
The financial statements of our foreign subs
u
idiaries that are denominated in functional currencies other than the U.S. dollar are
translated into U.S. dollars using period-end exchange rates for assets and liabi
a lities and weighted-average exchange rates for
48

revenues and expenses. The resulting translation adju
d stments are recorded as a component of Accumulated other
comprehensive income (loss).
Our foreign subs
u
idiaries typically record sales denominated in currencies other than the U.S. dollar, which are then translated
into U.S. dollars using weighted-average exchange rates. The changes in foreign currency exchange rates used for translation in
fiscal 2024 had a $7.4 million unfav
f
orable effe
f ct on our consolidated net sales.
Fluctuations in exchange rates between the U.S. dollar and other currencies may affe
f ct our results of operations, financial
position, and cash flows. Transactions by our foreign subs
u
idiaries may be denominated in a currency other than the entity's
functional currency. Foreign currency transaction gains and losses also include the impact of intercompany loans with foreign
subs
u
idiaries that are marked to market. In our consolidated statement of operations, these gains and losses are recorded within
Other (income) expense, net. Foreign currency transaction gains and losses related to intercompany loans with foreign
subs
u
idiaries that are of a long-term nature are accounted for as translation adju
d stments and are included in Accumulated other
comprehensive income (loss).
Interest Rate Risk
i
Our operating results are subj
u ect to risk from interest rate fluctuations on our secured revolving credit facility, which carries
variable interest rates. As of December 28, 2024, there were no variable rate borrowings outstanding under the secured
revolving credit facility. As a result, the impact of a hypothetical 100 bps increase in the effe
f ctive interest rate would not result
in a material amount of additional interest expense over a 12-month period.
Othe
t
r Risk
i
s
k
We enter into various purchase order commitments with our suppl
u
iers. We can cancel these arrangements, although in some
instances, we may be subj
u ect to a termination charge reflecting a percentage of work performed prior to cancellation.
49
Form 10-K

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
CARTER
S, INC.
INDEX TO CONSOLIDATED FINANCIAL STATEMENTS
Page
g
Report of Independent Registered Publ
u ic Accounting Firm (PCAOB 238 ID )
51
Consolidated Balance Sheets at December 28, 2024 and December 30, 2023
54
Consolidated Statements of Operations for the fiscal years ended December 28, 2024,
December 30, 2023, and December 31, 2022
55
Consolidated Statements of Comprehensive Income for the fiscal years ended December 28,
2024, December 30, 2023, and December 31, 2022
56
Consolidated Statements of Cash Flows for the fiscal years ended December 28, 2024,
December 30, 2023, and December 31, 2022
57
Consolidated Statements of Changes in Shareholders' Equity for the fiscal years ended
December 28, 2024, December 30, 2023, and December 31, 2022
58
Notes to Consolidated Financial Statements
59
50

Report of Independent Registered Public Accounting Firm
To the Board of Directors and Shareholders of Carter
s, Inc.
Opinions on the Fina
i
ncial Stat
t em
t
ents and Internal Contro
t
l over Fina
i
ncial Repor
e
ting
We have audited the accompanying consolidated balance sheets of Carter
s, Inc. and its subs
u
idiaries (the Company) as of
December 28, 2024 and December 30, 2023, and the related consolidated statements of operations, of comprehensive income,
of changes in shareholders
 equity and of cash flows for each of the three years in the period ended December 28, 2024,
including the related notes (collectively referred to as the consolidated financial statements). We also have audited the
Company
s internal control over financial reporting as of December 28, 2024, based on criteria establ
a ished in Internal Contro
t
l -
Integr
e
ated Framework
r (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).
In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial
position of the Company as of December 28, 2024 and December 30, 2023, and the results of its operations and its cash flows
for each of the three years in the period ended December 28, 2024 in confor
f
mity with accounting principles generally accepted
in the United States of America. Also in our opinion, the Company maintained, in all material respects, effe
f ctive internal
control over financial reporting as of December 28, 2024, based on criteria establ
a ished in Internal Contro
t
l - Integr
e
ated
Framework
r (2013) issued by the COSO.
Basisi for Opinions
The Company
s management is responsible for these consolidated financial statements, for maintaining effe
f ctive internal
control over financial reporting, and for its assessment of the effe
f ctiveness of internal control over financial reporting, included
in Management
s Report on Internal Control over Financial Reporting appearing under Item 9A. Our responsibility is to express
opinions on the Company
s consolidated financial statements and on the Company
s internal control over financial reporting
based on our audits. We are a public accounting firm registered with the Publ
u ic Company Accounting Oversight Board (United
States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities
laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the
audits to obtain reasonabl
a e assurance about whether the consolidated financial statements are free of material misstatement,
whether due to error or fraud, and whether effe
f ctive internal control over financial reporting was maintained in all material
respects.
Our audits of the consolidated financial statements included perfor
f
ming procedur
d
es to assess the risks of material misstatement
of the consolidated financial statements, whether due to error or fraud, and performing procedur
d
es that respond to those risks.
Such procedur
d
es included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated
financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by
management, as well as evaluating the overall presentation of the consolidated financial statements. Our audit of internal
control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the
risk that a material weakness exists, and testing and evaluating the design and operating effe
f ctiveness of internal control based
on the assessed risk. Our audits also included performing such other procedur
d
es as we considered necessary in the
circumstances. We believe that our audits provide a reasonable basis for our opinions.
Defi
e ni
i
tio
i
n and Limi
i
ta
i tions of Internal Contro
t
l over Fina
i
ncial Repor
e
ting
A company
s internal control over financial reporting is a process designed to provide reasonabl
a e assurance regarding the
reliabi
a lity of financial reporting and the preparation of financial statements for external purpos
r
es in accordance with generally
accepted accounting principles. A company
s internal control over financial reporting includes those policies and procedur
d
es
that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and
dispositions of the assets of the company; (ii) provide reasonabl
a e assurance that transactions are recorded as necessary to permit
preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and
expenditures of the company are being made only in accordance with authorizations of management and directors of the
company; and (iii) provide reasonabl
a e assurance regarding prevention or timely detection of unauthorized acquisition, use, or
disposition of the company
s assets that could have a material effe
f ct on the financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also,
projections of any evaluation of effe
f ctiveness to future periods are subj
u ect to the risk that controls may become inadequate
because of changes in conditions, or that the degree of compliance with the policies or procedur
d
es may deteriorate.
51
Form 10-K

Critical Auditi Matters
The critical audit matters communicated below are matters arising from the current period audit of the consolidated financial
statements that were communicated or required to be communicated to the audit committee and that (i) relate to accounts or
disclosures that are material to the consolidated financial statements and (ii) involved our especially challenging, subj
u ective, or
complex judgments. The communication of critical audit matters does not alter in any way our opinion on the consolidated
financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate
opinions on the critical audit matters or on the accounts or disclosures to which they relate.
Revenue Recognition - U.S. Wholesale
As described in Notes 2 and 3 to the consolidated financial statements, the Company
s U.S. wholesale revenue was $1.02
billion for the year ended December 28, 2024. The Company relies on shipping terms to determine when performance
obligations are satisfie
f d. The Company recognizes the revenue once control passes to the customer. When goods are shipped to
wholesale customers FOB Shipping Point, control of the goods is transfer
f red to the customer at the time of shipment. When
goods are shipped to wholesale customers FOB Destination, control of the goods is transfer
f red to the customer when the
goods reach the customer. The transaction price is the amount of consideration the Company expects to receive under the
arrangement. The Company is required to estimate variable consideration (if any) and to factor that estimation into the
determination of the transaction price. The Company may offe
f r sales incentives to wholesale and retail customers, including
discounts.
The principal consideration for our determination that performing procedur
d
es relating to U.S. wholesale revenue recognition is
a critical audit matter is a high degree of auditor effo
f
rt in performing procedur
d
es related to the Company
s U.S. wholesale
revenue recognition.
Addressing the matter involved performing procedur
d
es and evaluating audit evidence in connection with forming our overall
opinion on the consolidated financial statements. These procedur
d
es included testing the effe
f ctiveness of controls relating to the
revenue recognition process, including controls over the recording of U.S. wholesale revenue at the transaction price once
control passes to the customer. These procedur
d
es also included, among others (i) testing U.S. wholesale revenue transactions by
evaluating the issuance and settlement of invoices and credit memos, tracing transactions not settled to a detailed listing of
accounts receivabl
a e, and testing the completeness and accuracy of data provided by management; (ii) testing, on a sample basis,
sales incentive transactions by obtaining and inspecting source documents, including suppor
u
t for the nature of the incentive,
amount, and agreement with the customer; and (iii) testing, on a sample basis, outstanding customer invoice balances as of
December 28, 2024 by obtaining and inspecting source documents, such as invoices, proof of shipment or delivery,
r
and
subs
u
equent payment receipts.
Indefin
e
ite-Lived Intangible Asset Impai
m
rment Assessment - OshKos
K
h Tradename
As described in Notes 2 and 6 to the consolidated financial statements, the Company
s consolidated indefinite-lived tradename
balance was $266.2 million as of December 28, 2024, of which $40.0 million related to the OshKos
K
h tradename. The carrying
values of indefinite-lived tradename assets are subj
u ect to annual impairment reviews as of the last day of each fiscal year.
Between annual assessments, impairment reviews may also be triggered by any significant events or changes in circumstances
affe
f cting the business. As disclosed by management, a tradename is considered impaired if the estimated fair value of the
tradename is less than the carrying amount. The process of estimating the fair value of a tradename incorporates the relief-fro
f
m-
royalty valuation method, which requires management to make assumptions and to apply judgment, including forecasting
revenue growth and profita
f
bi
a lity and selecting the appropriate terminal growth rate, discount rate, and royalty rate. Based on the
indefinite-lived tradename asset impairment assessments, a non-cash pre-tax impairment charge of $30.0 million was recorded
during the fourth quarter of fiscal 2024 on the Oshkos
k
h tradename.
The principal considerations for our determination that performing procedur
d
es relating to the indefinite-lived intangible asset
impairment assessment of the OshKos
K
h tradename is a critical audit matter are (i) the significant judgment by management
when developing the fair value estimate of the OshKos
K
h tradename; (ii) a high degree of auditor judgment, subj
u ectivity, and
effo
f
rt in performing procedur
d
es and evaluating management
s significant assumptions related to revenue growth, terminal
growth rate, discount rate, and royalty rate; and (iii) the audit effo
f
rt involved the use of profes
f
sionals with specialized skill and
knowledge.
Addressing the matter involved performing procedur
d
es and evaluating audit evidence in connection with forming our overall
opinion on the consolidated financial statements. These procedur
d
es included testing the effe
f ctiveness of controls relating to
management
s indefinite- lived tradename impairment assessment, including controls over the valuation of the OshKos
K
h
tradename. These procedur
d
es also included, among others (i) testing management
s process for developing the fair value
52

estimate of the OshKos
K
h tradename; (ii) evaluating the appropriateness of the relief-fro
f
m-royalty valuation method; (iii) testing
the completeness and accuracy of underlying data used in the relief-from-royalty valuation method; and (iv) evaluating the
reasonabl
a eness of significant assumptions used by management related to revenue growth, terminal growth rate, discount rate,
and royalty rate. Evaluating management
s assumption related to revenue growth involved evaluating whether the assumption
used by management was reasonable considering (i) the current and past performance of the OshKos
K
h brand; (ii) the
consistency with external market and industry
r data; and (iii) whether the assumption was consistent with evidence obtained in
other areas of the audit. Profes
f
sionals with specialized skill and knowledge were used to assist in evaluating (i) the
appropriateness of the relief-from-royalty valuation method and (ii) the reasonabl
a eness of the terminal growth rate, discount
rate, and royalty rate assumptions.
Goodwill Impai
m
rment Assessment  Canada Repor
e
ting Unit
As described in Notes 2 and 6 to the consolidated financial statements, the Company
s consolidated goodwill balance was
$206.9 million as of December 28, 2024, and as disclosed by management, the goodwill allocated to the Canada reporting unit
was $36.8 million. The carrying values of goodwill are subj
u ect to annual impairment reviews as of the last day of each fiscal
year. Between annual assessments, impairment reviews may be triggered by any significant events or changes in circumstances
affe
f cting the business. An impairment is recorded for any excess carrying value above the fair value of the reporting unit, not to
exceed the carrying value of goodwill. Management uses qualitative and quantitative methods to assess for impairment,
including the use of discounted cash flows (income approach) and relevant data from guideline public companies (market
approach). The Company uses a 50% weighting of the income approach and a 50% weighting of the market approach to
determine the fair value of a reporting unit. The assumptions used in these approaches include revenue growth and profit
f ability,
terminal growth rates, discount rates, market multiples and an implied control premium.
The principal considerations for our determination that performing procedur
d
es relating to the goodwill impairment assessment
of the Canada reporting unit is a critical audit matter are (i) the significant judgment by management when developing the fair
value estimate of the Canada reporting unit; (ii) a high degree of auditor judgment, subj
u ectivity, and effo
f
rt in performing
procedur
d
es and evaluating management
s significant assumptions related to revenue growth and profita
f
bi
a lity, terminal growth
rate, discount rate, market multiples, and implied control premium; and (iii) the audit effo
f
rt involved the use of profes
f
sionals
with specialized skill and knowledge.
Addressing the matter involved performing procedur
d
es and evaluating audit evidence in connection with forming our overall
opinion on the consolidated financial statements. These procedur
d
es included testing the effe
f ctiveness of controls relating to
management
s goodwill impairment assessment, including controls over the valuation of the Canada reporting unit. These
procedur
d
es also included, among others (i) testing management
s process for developing the fair value estimate of the Canada
reporting unit; (ii) evaluating the appropriateness of the income and market approaches; (iii) testing the completeness and
accuracy of underlying data used in the income and market approaches; and (iv) evaluating the reasonabl
a eness of significant
assumptions used by management related to revenue growth and profita
f
bi
a lity, terminal growth rate, discount rate, market
multiples, and implied control premium. Evaluating management
s assumptions related to revenue growth and profita
f
bi
a lity
involved evaluating whether the assumptions used by management were reasonabl
a e considering (i) the current and past
performance of the Canada reporting unit; (ii) the consistency with external market and industry
r data; and (iii) whether the
assumptions were consistent with evidence obtained in other areas of the audit. Profes
f
sionals with specialized skill and
knowledge were used to assist in evaluating (i) the appropriateness of the income and market approaches and (ii) the
reasonabl
a eness of the terminal growth rate, discount rate, market multiples, and implied control premium assumptions.
/s/ PricewaterhouseCoopers LLP
Atlanta, Georgia
Februa
r
ry 25, 2025
We have served as the Company
s auditor since at least 1968. We have not been able to determine the specific year we began
serving as auditor of the Company.
53
Form 10-K

CARTER
S, INC.
CONSOLIDATED BALANCE SHEETS
(dol
d lars in thousands, except for share data)
December 28, 2024
December 30, 2023
ASSETS
Current assets:
Cash and cash equivalents
$
412,926
$
351,213
Accounts receivabl
a e, net of allowance for credit losses of $5,663 and $4,754,
respectively
194,834
183,774
Finished goods inventories
502,332
537,125
Prepaid expenses and other current assets
32,580
29,131
Total current assets
1,142,672
1,101,243
Property, plant, and equipment, net
180,956
183,111
Operating lease assets
577,133
528,407
Tradenames, net
268,008
298,186
Goodwill
206,875
210,537
Customer relationships, net
23,543
27,238
Other assets
33,980
29,891
Total assets
$
2,433,167
$
2,378,613
LIABILITIES AND SHAREHOLDERS
 EQUITY
Current liabi
a lities:
Accounts payabl
a e
$
248,200
$
242,149
Current operating lease liabi
a lities
130,564
135,369
Other current liabi
a lities
130,052
134,344
Total current liabi
a lities
508,816
511,862
Long-term debt, net
498,127
497,354
Deferred income taxes
38,210
41,470
Long-term operating lease liabi
a lities
501,503
448,810
Other long-term liabi
a lities
31,949
33,867
Total liabi
a lities
$
1,578,605
$
1,533,363
Commitments and contingencies - Note 19
Shareholders
 equity:
Prefer
f red stock; par value $0.01 per share; 100,000 shares authorized; none issued or
outstanding
$

$

Common stock, voting; par value $0.01 per share; 150,000,000 shares authorized;
36,041,995 and 36,551,221 shares issued and outstanding, respectively
360
366
Additional paid-in capital
3,856

Accumulated other comprehensive loss
(43,678)
(23,915)
Retained earnings
894,024
868,799
Total shareholders
 equity
854,562
845,250
Total liabi
a lities and shareholders
 equity
$
2,433,167
$
2,378,613
See accompanying notes to the consolidated financial statements.
54

CARTER
S, INC.
CONSOLIDATED STATEMENTS OF OPERAT
R
IONS
(dol
d lars in thousands, except
e
per share data)
scal year ended
December 28, 2024
December 30, 2023
December 31, 2022
Net sales
$
2,844,102
$
2,945,594
$
3,212,733
Cost of goods sold
1,478,936
1,549,659
1,740,375
Gross profit
f
1,365,166
1,395,935
1,472,358
Royalty income, net
19,251
21,410
25,820
Selling, general, and administrative expenses
1,099,689
1,093,940
1,110,007
Intangible asset impairment
30,000

9,000
Operating income
254,728
323,405
379,171
Interest expense
31,331
33,973
42,781
Interest income
(11,039)
(4,776)
(1,261)
Other expense (income), net
3,627
(8,034)
975
Loss on extinguishment of debt


19,940
Income before income taxes
230,809
302,242
316,736
Income tax provision
45,300
69,742
66,698
Net income
$
185,509
$
232,500
$
250,038
Basic net income per common share
$
5.12
$
6.24
$
6.34
Diluted net income per common share
$
5.12
$
6.24
$
6.34
Dividend declared and paid per common share
$
3.20
$
3.00
$
3.00
See accompanying notes to the consolidated financial statements.
55
Form 10-K

CARTER
S, INC.
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(dol
d lars in thousands)s
Fiscal year ended
December 28, 2024
December 30, 2023
December 31, 2022
Net income
$
185,509
$
232,500
$
250,038
Other comprehensive income:
Partial pension settlement charge, net of tax of $(224) for
fis
f cal 2024
725


Unrealized gain on OshKosh defined benefit plan, net of tax of
$(396), $(50), and $(540) for the fiscal years 2024, 2023, and
2022, respectively
1,275
160
1,739
Unrealized (loss) gain on Carter
s post-retirement benefit
obligation, net of tax of $80, $100, and $(100) for fiscal years
2024, 2023, and 2022, respectively
(274)
(330)
344
Foreign currency translation adju
d stments
(21,489)
10,593
(7,524)
Total other comprehensive (loss) income
(19,763)
10,423
(5,441)
Comprehensive income
$
165,746
$
242,923
$
244,597
See accompanying notes to the consolidated financial statements.
56

CARTER
S, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(dol
d lars in thousands)s
Fiscal year ended
December 28, 2024
December 30, 2023
December 31, 2022
Cash flows from operating activities:
Net income
$
185,509
$
232,500
$
250,038
Adju
d stments to reconcile net income to net cash provided by
operating activities:
Depreciation of property, plant, and equipment
54,233
60,407
61,543
Amortization of intangible assets
3,693
3,732
3,733
(Recoveries of)f provisions for excess and obsolete inventory,
r
net
(348)
(10,439)
5,039
Intangible asset impairment
30,000

9,000
Gain on partial termination of corporate lease

(4,366)

Other asset impairments and loss on disposal of property, plant
and equipment, net of recoveries
865
3,078
372
Amortization of debt issuance costs
1,630
1,586
1,950
Stock-based compensation expense
17,841
19,463
21,879
Unrealized foreign currency exchange loss (gain), net
380
(207)
(78)
Provisions for doubtful accounts receivabl
a e from customers
1,086
471
75
Loss on extinguishment of debt


19,940
Unrealized (gain) loss on investments
(2,214)
(2,237)
2,475
Partial pension plan settlement
949


Deferred income tax benefit
(6,422)
(600)
(740)
Other


919
Effe
f ct of changes in operating assets and liabi
a lities:
Accounts receivabl
a e
(13,743)
15,453
32,683
Finished goods inventories
26,131
222,920
(106,763)
Prepaid expenses and other assets
(2,962)
4,317
14,897
Accounts payabl
a e and other liabi
a lities
2,159
(16,946)
(228,601)
Net cash provided by operating activities
$
298,787
$
529,132
$
88,361
Cash flows from investing activities:
Capi
a tal expenditures
$
(56,165) $
(59,860) $
(40,364)
Net cash used in investing activities
$
(56,165) $
(59,860) $
(40,364)
Cash flows from financing activities:
Payment of senior notes due 2025
$

$

$
(500,000)
Premiums paid to extinguish debt


(15,678)
Payments of debt issuance costs


(2,420)
Borrowings under secured revolving credit facility

70,000
240,000
Payments on secured revolving credit facility

(190,000)
(120,000)
Repurchases of common stock
(50,526)
(100,034)
(299,667)
Dividends paid
(116,178)
(112,005)
(118,113)
Withholdings from vesting of restricted stock
(7,579)
(5,024)
(6,930)
Proceeds from exercise of stock options
367
4,418
4,457
Other
(900)

(919)
Net cash used in financing activities
$
(174,816) $
(332,645) $
(819,270)
Net effe
f ct of exchange rate changes on cash and cash equivalents
(6,093)
2,838
(1,273)
Net increase (decrease) in cash and cash equivalents
$
61,713
$
139,465
$
(772,546)
Cash and cash equivalents, beginning of fiscal year
351,213
211,748
984,294
Cash and cash equivalents, end of fiscal year
$
412,926
$
351,213
$
211,748
See accompanying notes to the consolidated financial statements.
57
Form 10-K

CARTER
S, INC.
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS
 EQUITY
(dol
d lars in thousands)s
Common stock
- shares
Common
stock - $
Additional
paid-in
capital
Accumulated
other
comprehensive
(loss)
income
Retained
earnings
Total
shareholders

equity
Balance at January 1, 2022
41,148,870
$
411
$

$
(28,897) $
978,672
$
950,186
Exercise of stock options
76,550

4,457


4,457
Withholdings from vesting of
restricted stock
(74,307)

(6,930)


(6,930)
Restricted stock activity
288,206
3
(3)



Stock-based compensation expense


21,879


21,879
Repurchases of common stock
(3,747,187)
(37)
(19,403)

(280,227)
(299,667)
Cash dividends declared and paid
of $3.00 per common share




(118,113)
(118,113)
Comprehensive income



(5,441)
250,038
244,597
Balance at December 31, 2022
37,692,132
$
377
$

$
(34,338) $
830,370
$
796,409
Exercise of stock options
64,700
1
4,417


4,418
Withholdings from vesting of
restricted stock
(64,952)
(1)
(4,652)

(371)
(5,024)
Restricted stock activity
305,610
3
(3)



Stock-based compensation expense


19,463


19,463
Repurchases of common stock
(1,446,269)
(14)
(18,325)

(81,695)
(100,034)
Cash dividends declared and paid
of $3.00 per common share




(112,005)
(112,005)
Comprehensive income



10,423
232,500
242,923
Other


(900)


(900)
Balance at December 30, 2023
36,551,221
$
366
$

$
(23,915) $
868,799
$
845,250
Exercise of stock options
4,408

367


367
Withholdings from vesting of
restricted stock
(94,143)
(1)
(5,735)

(1,843)
(7,579)
Restricted stock activity
316,932
3
(3)



Stock-based compensation expense


17,841


17,841
Repurchases of common stock
(736,423)
(8)
(8,255)

(42,263)
(50,526)
Cash dividends declared and paid
of $3.20 per common share




(116,178)
(116,178)
Comprehensive income



(19,763)
185,509
165,746
Other


(359)


(359)
Balance at December 28, 2024
36,041,995
$
360
$
3,856
$
(43,678) $
894,024
$
854,562
See accompanying notes to the consolidated financial statements.
58

CARTER
S, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
NOTE 1  THE COMPANY
Carter
s, Inc. and its wholly owned subs
u
idiaries (collectively, the Company) design, source, and market branded
childrenswear and related products under the Carter
s, OshKos
K
h B
gosh (or OshKos
K
h), Skip Hop,
o
Childl of Mine, Just One
You, Simple Joys
o
, Little Planet, and other brands. The Company
s products are sourced through contractua
t
l arrangements with
manufact
f
ur
t
ers worldwide for wholesale distribution to leading department stores, national chains, and specialty retailers
domestically and internationally and for sale in the Company
s retail stores and on its eCommerce sites that market its brand
name merchandise and other licensed products manufact
f
ur
t
ed by other companies.
NOTE 2  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation
Principl
i es
l
of Consolid
l at
d io
t n
The accompanying consolidated financial statements include the accounts of Carter
s, Inc. and its wholly owned subs
u
idiaries.
All intercompany transactions and balances have been eliminated in consolidation.
Fisc
i
al Year
The Company
s fiscal year ends on the Saturday in December or January nearest December 31. Every
r five or six years, our
fiscal year includes an additional 53rd week of results. Fiscal 2024 ended on December 28, 2024, fiscal 2023 ended on
December 30, 2023, and fiscal 2022 ended on December 31, 2022. All three fiscal years contained 52 calendar weeks.
Use of Estimates
t
in the Preparatio
t n of the Consolid
l at
d ed
t
Fina
i
ncial Stat
t em
t
ents
The preparation of these consolidated financial statements in confor
f
mity with accounting principles generally accepted in the
United States (U.S. GAAP) requires management to make estimates and assumptions that affe
f ct the reported amounts of
assets and liabi
a lities and disclosures of contingent assets and liabilities at the date of the financial statements, and the reported
amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.
Foreign Currency Translation and Transactions
Translat
l io
t n Adju
d
stme
t
ntst
The functional currency of subs
u
tantially all of the Company
s foreign operations is the local currency in each foreign country.
Assets and liabi
a lities are translated into U.S. dollars using the current exchange rates in effe
f ct at the balance sheet date, while
revenues and expenses are translated at the average exchange rates for the period. The resulting translation adju
d stments are
recorded as a component of Accumulated other comprehensive income (loss) within the accompanying consolidated balance
sheets.
Transactio
t n Adju
d
stme
t
ntst
The Company also recognizes gains and losses on transactions that are denominated in a currency other than the respective
entity
s functional currency. Foreign currency transaction gains and losses also include the impact of intercompany loans with
foreign subs
u
idiaries. Foreign currency transaction gains and losses are recognized in earnings, as a separate component of Other
expense (income), net, within the consolidated statements of operations. Foreign currency transaction gains and losses related to
intercompany loans with foreign subs
u
idiaries that are of a long-term nature are accounted for as translation adju
d stments and are
included in Accumulated other comprehensive income (loss) within the accompanying consolidated balance sheets.
Cash and Cash Equivalents
The Company considers all highly liquid investments that have original maturities of three months or less to be cash
equivalents. Cash and cash equivalents consist of deposit accounts and cash management funds invested in U.S. government
instruments. These investments are stated at cost, which approximates fair value. Cash equivalents also include amounts due
from third-party financial institut
t ions for credit and debit card transactions; these amounts typically settle in less than five days.
Money market funds held in a rabbi
a
trus
r
t that are being used as investments to satisfy the Company
s obligations under its
deferred compensation plans are treated as investments and recorded in Other assets on the accompanying consolidated balance
sheets.
59
Form 10-K

Concentratio
t n of Cash Depos
e
itst Risk
i
As of December 28, 2024, the Company had $412.9 million of cash and cash equivalents in majo
a r financial institut
t ions,
including $75.3 million in financial institutions located outside of the U.S. The Company maintains cash deposits with majo
a r
financial institutions that exceed the insurance coverage limits provided by the Federal Deposit Insurance Corporation in the
U.S. and by similar insurers for deposits located outside the U.S. To mitigate this risk, the Company utilizes a policy of
allocating cash deposits among majo
a r financial institutions that have been evaluated by the Company and third-party rating
agencies as having acceptable risk profile
f
s.
Accounts Receivable
Concentratio
t n of Credit
d
Risk
i
In fiscal 2024, our two largest wholesale customers accounted for 10.9% and 10.1% ,respectively, of the Company
s
consolidated net sales. No other customer accounted for 10% or more of the Company
s consolidated net sales in fiscal 2024. In
fiscal 2023, our largest wholesale customer accounted for 10.4% of the Company
s consolidated net sales. No other customer
accounted for 10% or more of the Company
s consolidated net sales in fiscal 2023. In fiscal 2022, no customer accounted for
10% or more of the Company
s consolidated net sales.
At December 28, 2024, three wholesale customers each had individual receivable balances in excess of 10% of gross accounts
receivabl
a e, and the total receivable balances due from these three wholesale customers in the aggregate equaled approximately
64% of total gross trade receivabl
a es outstanding. At December 30, 2023, three wholesale customers each had individual
receivabl
a e balances in excess of 10% of gross accounts receivabl
a e, and the total receivable balances due from these three
wholesale customers in the aggregate equaled approximately 56% of total gross trade receivables outstanding.
Valuatio
t n Accountst for Wholes
l
alel Accountst Receivablel
Accountst Receivable Reserves
The Company
s accounts receivabl
a e reserves for wholesale customers include an allowance for expected credit losses and an
allowance for chargebacks. The allowance for expected credit losses includes estimated losses resulting from the inability of
our customers to make payments. If the financial condition of a customer were to deteriorate, resulting in an impairment of its
ability to make payments, an additional allowance could be required. Past due balances over 90 days are reviewed individually
for collectability. The Company
s credit and collections department reviews all other balances regularly. Account balances are
charged offf against the allowance when it is probabl
a e that the receivabl
a e will not be recovered. The allowance for chargebacks
is based on historical experience and includes estimated losses resulting from pricing adju
d stments, short shipments, handling
charges, returns, and freight. Provisions for the allowance for expected credit losses are reflected in Selling, general, and
administrative (SG&A) expenses on the consolidated statement of operations and provisions for chargebacks are reflected as
a reduction in Net sales on the consolidated statement of operations.
Sales Returns Reserves
Except in very limited instances, the Company does not allow its wholesale customers to return goods to the Company.
Inventories
Inventories, which consist primarily of finished goods, are stated approximately at the lower of cost (using first-in, first-out
basis for wholesale inventory
r and average cost for retail inventory)
r
or net realizable value. Costs of finished goods inventories
include all costs incurred to bring inventory
r to its current condition, including inbound freight, duties, and other costs. Obsolete,
damaged, and excess inventory
r is carried at net realizable value by establ
a ishing reserves afte
f r assessing method of cost
determination, historical recovery rates, current market conditions, and future marketing and sales plans. Rebates, discounts,
and other cash consideration received from a vendor related to inventory
r purchases are reflected as reductions in the cost of the
related inventory
r item and are therefor
f
e reflected in cost of sales when the related inventory
r item is sold.
Leases
The Company has operating leases for retail stores, distribution centers, corporate offi
f ces, data centers, and certain equipment.
Financial Presentation
The Company determines if an arrangement is a lease at its inception. Operating leases are included in Operating lease assets,
Current operating lease liabilities, and Long-term operating lease liabi
a lities in our consolidated balance sheets.
CARTER
S, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
60

Right of use (ROU) assets represent our right to use an underlying asset for the lease term, and lease liabi
a lities represent our
obligation to make lease payments arising from the lease. Operating lease ROU assets and liabi
a lities are recognized at
commencement date based on the present value of lease payments over the lease term. Our lease terms may include options to
extend or terminate the lease when it is reasonabl
a y certain that we will exercise that option.
The operating lease ROU asset also includes initial direct costs and excludes lease incentives. Lease expense is recognized on a
straight-line basis over the lease term.
Certain of our lease agreements include variable rental payments based on a percentage of retail sales over contractua
t
l levels
and others include variable rental payments adju
d sted periodically for inflation. Our lease agreements do not contain any
material residual value guarantees or material restrictive covenants.
Policy
c Elections
Portfolio approach - In general, the Company accounts for the underlying leased asset and applies a discount rate at the lease
level. However, there are certain non-real estate leases for which the Company utilizes the portfol
f io method by aggregating
similar leased assets based on the underlying lease term.
Non-lease component - The Company has lease agreements with lease and non-lease components. The Company has elected a
policy to account for lease and non-lease components as a single component for all asset classes.
Short-term lease - Leases with an initial term of 12 months or less are not recorded on the balance sheets.
Discount rate - As the rate implicit in the majo
a rity of the Company
s leases is not readily determinable, the Company uses the
incremental borrowing rate based on the information availabl
a e at commencement date, including the lease term and currency, in
determining the present value of lease payments.
Renewal options - The Company evaluates the inclusion of renewal options on a lease by lease basis. In general, for leased
retail real estate, the Company does not include renewal options in the underlying lease term.
Property, Plant, and Equipment
Property, plant, and equipment are stated at cost, less accumulated depreciation and amortization. When fixed assets are sold or
otherwise disposed of,f the accounts are relieved of the original cost of the assets and the related accumulated depreciation or
amortization and any resulting gain or loss is credited or charged to income. For financial reporting purpos
r
es, depreciation and
amortization are computed on the straight-line method over the estimated useful
f
lives of the assets as follows: buildings and
improvements from 15 to 26 years, retail store fixtur
t
es, equipment, and computers from 3 to 10 years. Leasehold improvements
and fixed assets purchased under capital leases are amortized over the lesser of the asset lifef or the related lease term.
Internal-Use Software
The Company purchases software licenses from external vendors and also develops software internally using Company
employees and consultants. Software license costs, as well as development-stage costs for internally-developed software, are
capi
a talized within Property, plant, and equipment, net on the consolidated balance sheets. All other costs, including preliminary
r
project costs and post-implementation costs for internally-developed software, are expensed as incurred. Capi
a talized software is
depreciated or amortized on the straight-line method over its estimated useful
f
lives, from 3 to 10 years.
If a software application does not include a purchased license for the software, such as a cloud-based software application, the
arrangement is accounted for as a service contract. Implementation costs incurred in the development stage of such software
applications are capitalized and reported in Prepaid expenses and other current assets on the consolidated balances sheets. All
other costs, including preliminary project costs and post-implementation costs for these software applications, are expensed as
incurred. Any capi
a talized costs are amortized over the term of the hosting arrangement, and the expense is presented in the
same line item within the consolidated statements of operations as the expense for the service contract
s fees.
Goodwill and Other Indefinite-Lived Intangible Assets
Annual Impai
m
rm
i
ent Reviews
The carrying values of the goodwill and indefinite-lived tradename assets are subj
u ect to annual impairment reviews, which are
performed as of the last day of each fiscal year. Additionally, a review for potential impairment is performed whenever
significant events or changes in circumstances indicate that the carrying value of the assets may not be recoverabl
a e. These
impairment reviews are performed in accordance with ASC 350, In

tangibles--Goodwill and Othe
t
r (ASC 350). Significant
CARTER
S, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
61
Form 10-K

assumptions in the impairment models include estimates of revenue growth and profita
f
bi
a lity, terminal growth rates, discount
rates, market multiples, an implied control premium, and, in the case of tradenames, royalty rates. Discount rates are dependent
upon interest rates and the cost of capital at a point in time.
Goodwill
The Company performs impairment tests of its goodwill at the reporting unit level. Qualitative and quantitative methods are
used to assess for impairment, including the use of discounted cash flows (income approach) and relevant data from guideline
public companies (market approach).
Under a qualitative assessment, the Company determines if it is more likely than not that the fair value of the reporting unit is
less than its carrying value. Qualitative factors may include but are not limited to: macroeconomic conditions, industry
r and
market considerations, cost factors that may have a negative effe
f ct on earnings, overall financial performance, and other
relevant entity-specific events. If the Company determines that it is more likely than not that the fair value of the reporting
unit is less than its carrying value, then a goodwill impairment test using quantitative assessments must be performed. If it is
determined that it is not more likely than not that the fair value of the reporting unit is less than its carrying value, then no
further testing is required and the Company documents the relevant qualitative factors that suppor
u
t the strength in the fair value.
Under a quantitative assessment for goodwill, the Company compares the fair value of a reporting unit to its carrying value,
including goodwill. The Company uses a 50% weighting of the income approach and a 50% weighting of the market approach
to determine the fair value of a reporting unit. The assumptions used in these approaches include revenue growth and
profita
f
bi
a lity, terminal growth rates, discount rates, market multiples and an implied control premium. These assumptions are
consistent with those of hypothetical marketpl
t ace participants. An impairment is recorded for any excess carrying value above
the fair value of the reporting unit, not to exceed the carrying value of goodwill.
In fiscal 2024, the Company perfor
f
med a quantitative impairment test on the goodwill ascribed to each of the Company
s
reporting units and on the value of its indefinite-lived intangible tradename assets as of December 28, 2024. Based upon this
assessment, there were no impairments to the value of goodwill.
Indefi
e ni
i
te
i -Lived Intangible Assets
For indefinite-lived tradenames, the Company may utilize a qualitative assessment, as described above, to determine whether
the fair value of an indefinite-lived asset is less than its carrying value. If a quantitative assessment is necessary, the Company
determines fair value using the relief-from-royalty valuation method, which examines the hypothetical cost savings that accrue
r
as a result of not having to license the tradename from another owner. The relief-from-royalty valuation method involves two
steps: (1) estimation of reasonabl
a e royalty rates for the tradename assets and (2) the application of these royalty rates to a
forecasted net revenue stream and discounting the resulting cash flows to determine a fair value. If the carrying amount exceeds
the fair value of the tradename, an impairment charge is recognized in the amount of the excess.
As discussed above, the Company performed quantitative impairment assessments on the value of the Company
s indefinite-
lived intangible tradename assets as of December 28, 2024. Based on these assessments, a non-cash pre-tax impairment charge
of $30.0 million was recorded during the fourth quarter of fiscal 2024 on our indefinite-lived OshKos
K
h tradename asset to write-
down the carrying value to $40.0 million. This impairment charge was the result of decreased actual and projected sales and
profita
f
bi
a lity for our OshKos
K
h brand.
Impairment of Other Long-Lived Assets
The Company reviews other long-lived assets, including ROU lease assets, property, plant, and equipment, definite-lived
tradename assets, and customer relationship assets, for impairment whenever events or changes in circumstances indicate that
the carrying amount of such an asset may not be recoverabl
a e. To determine whether there has been a permanent impairment on
such assets, a recoverabi
a lity test is performed by comparing anticipated undiscounted future cash flows from the use and
eventual disposition of the asset or asset group to the carrying value of the asset. If the undiscounted cash flows are less than the
related carrying value of the other long-lived asset, they are written down to their fair value. The process of estimating the fair
value requires us to make assumptions and to apply judgment including forecasting revenue growth and profita
f
bi
a lity, utilizing
external market participant assumptions, including estimated market rents, and selecting the appropriate discount rate. Long-
lived assets that meet the definition of held for sale will be valued at the lower of carrying amount or fair value, less costs to
sell.
CARTER
S, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
62

Deferred Debt Issuance Costs
Debt issuance costs associated with the Company
s secured revolving credit facility and senior notes are deferred and amortized
to interest expense over the term of the related debt using the effe
f ctive interest method. Debt issuance costs associated with
Company
s senior notes are presented on the Company
s consolidated balance sheet as a direct reduction in the carrying value
of the associated debt liabi
a lity. Fees paid to lenders by the Company to obtain its secured revolving credit facility are included
within Other assets on the Company
s consolidated balance sheets and classified as either current or non-current based on the
expiration date of the credit facility.
Fair Value Measurements
The fair value framework requires the Company to categorize certain assets and liabi
a lities into three levels, based upon the
assumptions used to price those assets or liabi
a lities. The three levels are defined as follows:
Level 1: Quoted prices in active markets for identical assets or liabilities.
Level 2: Quoted prices for similar assets and liabi
a lities in active markets or inputs that are observabl
a e.
Level 3: Unobservabl
a e inputs reflecting management
s own assumptions about the inputs used in pricing the asset or
liabi
a lity.
The Company measures its pension assets, deferred compensation plan investment assets, and any unsettled foreign currency
forward contracts at fair value. The Company
s ca h
sh and ca h
sh eq iuivalents, accounts receiv b
able, and accounts payablbl
a e are h
short-
term in nature. As su h
ch, hth ieir ca y
rrying value appr
i
oximates fair value.
h
The car y
rying values of the Company
s outstanding borrowings are not required to be remeasured and adju
d sted to the then-
current fair values at the end of each reporting period. Instead, the fair values of the Company
s outstanding borrowings are
disclosed at the end of each reporting period in Note 14, Fair Value Measurements, to the consolidated financial statements.
Had the Company been required to remeasure and adju
d st the carrying values of its outstanding borrowings to fair value at the
end of each reporting period, such fair value measurements would have been disclosed as a Level 2 liabi
a lity in the fair value
hierarchy.
Revenue Recognition
In accordance with ASC 606, Revenue from Contra
t
ctst with Customers
r
, the Company uses the five-step model to recognize
revenue:
1)
Identify
f the contract with the customer;
2)
Identity the performance obligation(s);
3)
Determine the transaction price;
4)
Allocate the transaction price to each performance obligation if multiple obligations exist; and
5)
Recognize the revenue when (or as) the performance obligations are satisfied.
Perfor
f
mance Obligat
i
ions
The Company identifie
f s each distinct performance obligation to transfer
f
goods (or bundle of goods). Revenue transactions
associated with the sale of products to customers through wholesale and international channels and to retail customers that are
not members of the Carter
s Rewards
d loyalty program comprise of a single performance obligation. Revenue transactions
associated with the sale of products to retail customers that are members of the Carter
s Rewards
d loyalty program comprise of
two performance obligations: the transfer
f
of control of the goods to the customer and the option for members to earn loyalty
points that accumulate towards earning reward certificates. Other than inbound and outbound
t
freight and shipping
arrangements, the Company does not use third parties to satisfy its performance obligations in revenue arrangements with
customers.
When Perfor
f
mance Obligat
i
ions Are Satisfie
s
d
Wholesale Revenues - The Company has a single performance obligation in its wholesale arrangements, including
replenishment orders. The Company typically satisfies its performance obligation when it transfer
f s control of the goods to the
customer upon shipment. However, in certain arrangements where the Company retains the risk of loss during shipment,
satisfaction of the performance obligation occurs when the goods reach the customer. To ensure proper timing of revenue
recognition, the Company defers the recognition of revenue for shipments that originated at the end of the reporting period in
which the Company retains the risk of loss during shipment. Pack and hold inventories are not yet associated with any
CARTER
S, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
63
Form 10-K

purchase order or purchase commitment. Therefor
f
e, these inventories are treated consistently with the rest of our wholesale
inventory,
r
and no deferral of revenue has been recognized.
Retail Revenues - For transactions in stores, the Company satisfies its performance obligation at point of sale when the
customer takes possession of the goods and tenders payment. For purchases made through the Company
s eCommerce channel,
revenue is recognized when the goods are physically delivered to the customer or picked up in store. To ensure proper timing of
revenue recognition, the Company defers the recognition of revenue for eCommerce channel shipments that originated at the
end of the reporting period.
Loyalty Program - U.S. retail customers can earn loyalty points that accumulate towards earning reward certific
f ates that are
redeemable for a specifie
f d amount offf of future purchases. Loyalty points expire six months from the day they were earned, and
reward certific
f ates expire 45 days afte
f r issuance. Points and reward certific
f ates earned by retail customers under Carter
s
Rewards
d , the Company
s loyalty program, represent a separate performance obligation. For transactions where a customer earns
loyalty points, the Company allocates revenue between the goods sold and the loyalty points expected to be earned towards a
reward certific
f ate based upon the relative standalone selling price. The revenue that is deferred is recorded within Other current
liabi
a lities on the Company
s consolidated balance sheets and then recognized as revenue upon redemption of the reward
certific
f ate. Loyalty program breakage is recognized as revenue based on the customer redemption pattern.
Gift Cards - Customer purchases of gift cards are not recognized as revenue until the gift card is redeemed. The revenue that is
deferred is recorded within Other current liabi
a lities on the Company
s consolidated balance sheets. Gifts cards do not have an
expiration date however, gift card breakage is recognized as revenue based upon the historical customer redemption pattern.
Credit Card Revenues - The Company
s private labe
a
l credit card is issued to customers for use exclusively at the Company
s
U.S. stores and U.S. eCommerce sites. Credit is extended to such customers by a third-party financial institution without
recourse to the Company. The Company
s performance obligations under the private labe
a
l credit card agreement include
providing program marketing and intellectua
t
l property to the third-party financial institution in suppor
u
t of the private labe
a
l
credit card program, as well as operating a loyalty program. The upfro
f
nt bonus paid to the Company is recognized as revenue
on a straight-line basis over the term of the agreement. Usage-based royalties are primarily recognized as revenue in the period
of usage and an amount is recognized on a point-in-time basis as redemptions under the loyalty program occur. Revenue
associated with the establ
a ishment of new credit accounts is recognized in the period the activity occurred. Revenues related to
the Company
s private labe
a
l credit card program are recorded as Net sales on the Company
s consolidated statement of
operations.
Royalty Revenues - The Company has a single performance obligation in its licensing agreements with domestic and
international licensees: to grant licensees the right to access certain trademarks in return for royalty payments or licensing fees.
The Company satisfies its performance obligations with licensees over time as customers have the right to use the intellectua
t
l
property over the contract period. Royalty revenues are included within Royalty income, net on the Company
s consolidated
statements of operations.
Signi
i
fic
i
ant Paym
a
ent Terms
Retail customers tender a form of payment, such as cash or a credit/debit card, at point of sale. For wholesale customers and
licensees, payment is due based on establ
a ished terms, which is generally sixty days or less from date of shipment.
Returns and Refu
e nds
The Company establ
a ishes return provisions for retail customers in the period the sales occur. Return provisions are calculated
based on historical return data and are recorded within Other current liabi
a lities on the Company
s consolidated balance sheets.
Except in very limited instances, the Company does not allow its wholesale customers to return goods to the Company.
CARTER
S, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
64

Signi
i
fic
i
ant Judgments
Sale of Goods - The Company relies on shipping terms to determine when performance obligations are satisfied. The Company
recognizes the revenue once control passes to the customer. When goods are shipped to wholesale customers FOB Shipping
Point, control of the goods is transfer
f red to the customer at the time of shipment. When goods are shipped to wholesale
customers FOB Destination, control of the goods is transfer
f red to the customer when the goods reach the customer. For most
retail transactions in stores, no significant judgments are involved since revenue is recognized at the point of sale when tender is
exchanged and the customer receives the goods. For retail transactions made through the Company
s eCommerce channel,
revenue is recognized when the goods are physically delivered to the customer. The Company recognizes revenue from omni-
channel sales, including buy-online and pick-up
u in-store, buy-online, ship-to-store, and buy-online, deliver-from-store, when
the product has been picked up by the customer at the store or when the product is physically delivered to the customer.
Royalty Revenues - The Company transfer
f s the right-to-use benefit to the licensee for the contract term and therefore
f
the
Company satisfies its performance obligation over time. Revenue recognized for each reporting period is based on the greater
of:f 1) the royalties owed on actual net sales by the licensee and 2) a minimum royalty guarantee, if applicable.
Transaction Price - The transaction price is the amount of consideration the Company expects to receive under the arrangement.
The Company is required to estimate variable consideration (if any) and to factor that estimation into the determination of the
transaction price. The Company may offe
f r sales incentives to wholesale and retail customers, including discounts. Additionally,
the Company recognizes an allowance for chargebacks for wholesale customers that is based on historical experience and
includes estimated losses resulting from pricing adju
d stments, short shipments, handling charges, returns, and freight. For retail
transactions, the Company has significant experience with return patterns and relies on this experience to estimate expected
returns when determining the transaction price.
Standalone Selling Prices - For arrangements that contain multiple performance obligations, including sales through our
Carter
s Rewards
d loyalty program, the Company allocates the transaction price to each performance obligation on a relative
standalone selling price basis.
Costs Incurred to Obtain a Contract - Incremental costs to obtain contracts are not material to the Company.
Policy
c Elections
In addition to those previously disclosed, the Company has made the following accounting policy elections and practical
expedients:

Portfolio Approach - The Company uses the portfol
f io approach when multiple contracts or performance obligations
are involved in the determination of revenue recognition. This approach is primarily used to estimate the redemption of
loyalty points, loyalty point breakage, and gift card breakage.

Taxes - The Company excludes from the transaction price any taxes collected from customers that are remitted to
taxing authorities.

Shipping and Handling Charges - Charges that are incurred before and afte
f r the customer obtains control of goods are
deemed to be fulfil
f lment costs and are included in Cost of goods sold when the related revenues are recognized.

Time Value of Money - The Company
s payment terms are less than one year from the transfer
f
of goods. Therefore
f
,
the Company does not adju
d st promised amounts of consideration for the effe
f cts of the time value of money.

Disclosure of Remaining Performance Obligations - The Company does not disclose the aggregate amount of the
transaction price allocated to remaining performance obligations for contracts that are one year or less in term.
Cooperative advertising arrangements reimburse customers for marketing activities for certain of our products. The Company
records these reimbursements under cooperative advertising arrangements with certain of its majo
a r wholesale customers at fair
value. Fair value is determined based upon, among other factors, comparable market analysis for similar advertisements. The
Company has included the fair value of these arrangements of $0.9 million and $0.6 million for fiscal 2024 and fiscal 2022 as a
component of SG&A expenses on the Company
s consolidated statements of operations, rather than as a reduction of Net sales.
There were no amounts for cooperative advertising arrangements recorded as a component of SG&A expenses for fiscal 2023.
Amounts determined to be in excess of the fair value of these arrangements are recorded as a reduction of Net sales. For
arrangements in which the Company does not receive a distinct good or service, we record these reimbursements as a reduction
of net sales. The majo
a rity of the Company
s digital cooperative advertising arrangements are recorded as a reduction of net
sales as there was no distinct good or service received by the Company.
CARTER
S, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
65
Form 10-K

Costs of Goods Sold and Selling, General and Administrative Expenses
In addition to the cost of product, cost of goods sold include changes to our inventory
r reserve and expenses related to the
merchandising, design, and procurement of product, including inbound freight costs, purchasing and receiving costs, and
inspection costs. Also included in costs of goods sold are the costs of shipping eCommerce product to end consumers. For
omni-channel transactions, costs of goods sold include the costs of shipping product to end customers or to retail stores.
Retail store occupa
u
ncy costs, distribution expenses, and generally all expenses other than interest and income taxes are included
in SG&A expenses. Distribution expenses that are included in SG&A primarily consist of payments to third-party shippers and
handling costs to process product through our distribution facilities, including eCommerce fulfillme
f
nt costs, and delivery to our
wholesale customers and to our retail stores. Distribution expenses included in SG&A totaled $176.9 million, $183.4 million,
and $216.2 million for fiscal years 2024, 2023, and 2022, respectively.
Gross Profit
f
Gross profit
f
is calculated as consolidated net sales less cost of goods sold. Gross margin is calculated as gross profit
f
divided by
consolidated net sales. Our gross profit
f
and gross margin may not be comparable to other entities that define their metrics
differently.
Income from Royalties and License Fees
We license our Carter
s, OshKos
K
h, Childl of Mine, Just One You, Simple Joys
o
, and Little Planet brands to various license
partners in order to expand our product offe
f rings into footwear, outerwear, accessories (such as hair accessories and jewelry),
r
toys, home décor, cribs and baby
a
furniture, and bedding. These royalties are recorded as earned, based upon the sales of
licensed products by licensees and reported as royalty income on the Company
s consolidated statements of operations.
Advertising Expenses
Advertising production costs and costs associated with communicating advertising that has been produced are expensed when
the advertising event takes place. Certain other advertising costs where it is uncertain when the expected benefits would occur
are expensed in the period incurred. Advertising expenses were $84.1 million, $74.1 million, and $96.0 million for fiscal years
2024, 2023, and 2022, respectively, and are included in SG&A expenses on the Company
s consolidated statement of
operations. Deferred advertising costs for advertisements that have not yet occurred or for advertising services that have not yet
been received were $2.1 million and $1.2 million at December 28, 2024 and December 30, 2023, respectively, and are included
in Prepaid expenses and other current assets on the Company
s consolidated balance sheets.
Stock-Based Compensation Arrangements
The Company recognizes the cost resulting from all stock-based compensation arrangements in the financial statements at grant
date fair value. Stock-based compensation expense is recognized over the requisite service period, net of estimated forfei
f tures.
Subj
u ective assumptions include a forfeiture rate assumption for all restricted stock awards and an estimate for the probabi
a lity
that the performance criteria will be achieved for performance awards. We estimate forfeitures of restricted stock awards based
on historical experience and expected future activity.
Changes in the subj
u ective assumptions can materially affe
f ct the estimate of fair value of stock-based compensation and
consequently, the related amount recognized in the accompanying consolidated statements of operations.
During the requisite service period, the Company also recognizes a deferred income tax benefit for the expense recognized for
U.S. GAAP. At time of subs
u
equent vesting, exercise, forfei
f ture, or expiration of an award, the difference between the
Company
s actua
t
l income tax deduction, if any, and the previously accrue
r
d income tax benefit is recognized in income tax
expense/be
/
nefit during the current period.
Stoc
t
k Options
The fair value of stock options is determined based on the Black-Scholes option pricing model, which requires the use of
subj
u ective assumptions. There has been no issuances of stock options since 2018, and there are no unrecognized compensation
costs remaining related to stock options.
Time
i
-Based Restri
t cted
t
Stoc
t
k Awards
The fair value of time-based restricted stock awards is determined based on the quoted closing price of the Company
s common
stock on the date of grant and is recognized as compensation expense over the vesting term of the awards, net of estimated
forfeitures.
CARTER
S, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
66

Perfor
f
ma
r
nce-Ba
-
sed Restri
t cted
t
Stoc
t
k Awards
d
The Company accounts for its performance-based restricted stock awards based on the quoted closing price of the Company
s
common stock on the date of grant and records stock-based compensation expense over the vesting term of the awards based on
the probabi
a lity that the performance criteria will be achieved, net of estimated forfeitures. The Company reassesses the
probabi
a lity of vesting at each reporting period and adju
d sts stock-based compensation expense based on its probabi
a lity
assessment.
Market-B
t
ased Restri
t cted
t
Stoc
t
k Awards
The Company accounts for its market-based restricted stock awards, which are tied to the Company
s relative total shareholder
retur
t
n (TSR), using a grant-date fair value determined through a Monte Carlo simulation model. This valuation method
considers the potential range of TSR outcomes relative to a defined peer group over the performance period and uses subj
u ective
assumptions, including the expected volatility of the Company
s stock price for the period, risk-free interest rate, and expected
dividend yield. The resulting fair value of the award is fixed at the grant date and is not subs
u
equently adju
d sted for changes in the
Company
s TSR or the likelihood of achieving the market condition. Stock-based compensation expense is recognized on a
straight-line basis over the vesting term of the awards, net of estimated forfeitures, regardless of whether the market condition is
ultimately achieved.
Stoc
t
k Awards
d
The fair value of stock granted to non-management board members is determined based on the quoted closing price of the
Company
s common stock on the date of grant. The Company records the stock-based compensation expense immediately as
there are no vesting terms.
Income Taxes
The accompanying consolidated financial statements reflect current and deferred tax provisions, in accordance with ASC 740,
Income Taxes
a
. The deferred tax provision is determined under the liabi
a lity method. Deferred tax assets and liabi
a lities are
recognized based on differences between the book and tax basis of assets and liabi
a lities using presently enacted tax rates.
Deferred tax assets are a component of non-current Other assets in the Company
s consolidated balance sheet. Valuation
allowances are establ
a ished when it is more likely than not that a deferred tax asset will not be recovered. The provision for
income taxes is the sum of the amount of income taxes paid or payabl
a e for the year as determined by applying the provisions of
enacted tax laws to the taxabl
a e income for that year, the net change during the year in deferred tax assets and liabi
a lities, and the
net change during the year in any valuation allowances.
The Company assesses its income tax positions and records tax benefits for all years subj
u ect to examination based upon
management
s evaluation of the facts, circumstances, and information availabl
a e at the reporting dates. A company may
recognize the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained
on examination by the taxing authorities, based on the technical merits of the position. If it is more likely than not that a tax
position would not be sustained, then no tax benefit would be recognized. Where applicable, associated interest and penalties
are also recorded. Interest is recorded as a component of Interest expense and penalties, if any, are recorded within the provision
for incomes taxes in the consolidated statements of operations and are classified on the consolidated balance sheets with the
related liabi
a lity for uncertain tax contingency liabilities.
Supplemental Cash Flow Information
Interest paid in cash was $29.5 million, $32.3 million, and $41.2 million for fiscal years 2024, 2023, and 2022, respectively.
Income taxes paid in cash was $51.3 million, $76.5 million, and $64.0 million for fiscal years 2024, 2023, and 2022,
respectively.
Additions to property, plant and equipment of $3.4 million, $1.6 million, and $10.1 million were excluded from capital
expenditures on the Company
s consolidated statements of cash flows for fiscal years 2024, 2023, and 2022, respectively, as
these amounts were accrued and unpaid at the end of each respective fiscal year.
Earnings Per Share
The Company calculates basic and diluted net income per common share under the two-class method for unvested share-based
payment awards that contain participating rights to dividends or dividend equivalents (whether paid or unpaid).
Basic net income per share is calculated by dividing net income for the period by the weighted-average common shares
outstanding for the period. Diluted net income per share includes the effe
f ct of dilutive instruments (primarily stock options) and
CARTER
S, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
67
Form 10-K

uses the average share price for the period in determining the number of shares that are to be added to the weighted-average
number of shares outstanding.
Open Market Repurchases of Common Stock
Shares of the Company
s common stock that are repurchased by the Company through open market transactions are retired.
Through the end of fiscal 2024, all such open market repurchases have been at prices that exceeded the par value of the
repurchased common stock, and the amounts of the purchase prices that exceeded par value were charged to additional paid-in
capital or to retained earnings if the balance in additional paid-in capital was not sufficient.
The Inflation Reduction Act of 2022 imposed a nondeductible 1% excise tax on the net value of certain share repurchases made
afte
f r December 31, 2022. Beginning in fiscal 2023, the Company reflected the applicable excise tax in Additional paid-in
capital on the Company
s consolidated balance sheets as part of the cost basis of the shares repurchased. The corresponding
liabi
a lity for the excise tax payabl
a e is recorded in Other current liabi
a lities on the Company
s consolidated balance sheets.
Employee Benefit Plans
The Company has several defined benefit plans. Various actua
t
rial methods and assumptions are used in determining net
pension and post-retirement costs and obligations. Key assumptions include the discount rate used to determine the present
value of future benefits and the expected long-term rate of return on plan assets. The over-funded or under-funded status
t
of the
defined benefit plans is recorded as an asset or liability on the consolidated balance sheet. Any service costs that arise during
the period are presented in the same statement line item as other employee compensation on the consolidated statement of
operations. All other components of current period costs related to defined benefit plans, such as prior service costs and
actua
t
rial gains and losses, are presented in Other (income) expense, net on the consolidated statement of operations. The
actua
t
rial gains or losses that arise during the period are recognized as a component of comprehensive income or loss, net of tax.
These costs or income are then subs
u
equently recognized as components of net periodic benefit cost in the consolidated
statements of operations. Under the provisions of ASU No. 2015-04, Practical Expe
x
dient for the Measurement Date of an
Empl
m oyer
s Defin
e
ed Benefi
e t Obligat
i
ion and Plan Assets, the Company is permitted to use December 31 of each year, as
opposed to the Company
s last day of each fiscal year, as an alternate measurement date for its defined benefit plans.
During the second quarter of fiscal 2024, the Company announced the offe
f ring of a single-sum payment option to certain
participants in the frozen OshKosh B
Gosh, Inc. Pension Plan (the pension plan), which commenced on June 1, 2024 and
closed on July 15, 2024. In the third quarter of fiscal 2024, the pension plan paid $6.9 million from pension plan assets to
electing participants, thereby reducing its pension benefit obligations. The transaction had no cash impact on the Company but
did result in a non-cash pre-tax partial pension settlement charge of $0.9 million, which is included in Other expense (income),
net on the Company
s consolidated statement of operations.
Additionally, the Board of Directors authorized the termination of the pension plan, with an effe
f ctive date of November 30,
2024. The Company may be required to make a contribution to fully fund the plan for termination prior to the purchase of a
group annuity contract to transfer
f
its remaining liabilities under the pension plan. The contribution amount will depend upon the
nature and timing of participant settlements and prevailing market conditions. The Company expects to recognize a non-cash
charge upon settlement of the pension plan
s obligations in the second half of fiscal 2025. The Company has the right to change
the effe
f ctive date of the termination date or revoke the decision to terminate, but it has no current intent to do so.
Facility Closure and Severance Costs
The Company records severance costs when the appropriate notific
f ations have been made to affe
f cted employees or when the
decision is made, if the one-time benefits are contractua
t
l. When employees are required to work for a period before termination,
the severance costs are recognized over the required service period. For operating leases, lease termination costs are recognized
at fair value at the date the Company ceases to use the leased property. Useful
f
lives assigned to fixed assets at the facility to be
closed are revised based on the specifics of the exit plan, resulting in accelerated depreciation expense.
Seasonality
The Company experiences seasonal fluctuations in its sales and profita
f
bi
a lity due to the timing of certain holidays and key retail
shopping periods, typically resulting in lower sales and gross profit
f
in the first half of its fiscal year. Accordingly, the
Company
s results of operations during the first half of the year may not be indicative of the results for the full year.
CARTER
S, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
68

Recent Accounting Pronouncements
Adopt
d
ed
t
in Fisc
i
al 2024
Segm
e
ent Repor
e
ting - Impr
m
ovements to Repor
e
table Segm
e
ent Disc
i
losures (ASU 2023-07)
In November 2023, the FASB issued ASU No. 2023-07, Segm
e
ent Repor
e
ting - Impr
m
ovements to Repor
e
table Segm
e
ent Disc
i
losures.
This new guidance is designed to improve the disclosures about a public entity
s reportabl
a e segments and address requests from
investors for more detailed information about a reportabl
a e segment
s expenses in an interim and annual basis. ASU 2023-07 is
effe
f ctive for fiscal years beginning afte
f r December 15, 2023, and interim periods within fiscal years beginning afte
f r December
15, 2024. Publ
u ic entities must adopt the changes to the segment reporting guidance on a retrospective basis. The Company
adopted ASU 2023-07 in fiscal 2024. The effe
f ct of the adoption of ASU 2023-07 was not material to the Company
s
consolidated financial statements.
Supplier Finance Programs (ASU 2022-04)
In September 2022, the FASB issued Accounting Standards Update No. 2022-04, Liabilities - Supplier Finance Programs
(Subt
S
opic 405-50): Disc
i
losure of Supplier Finance Program Obligat
i
ions (ASU 2022-04). This new guidance is designed to
enhance transparency around suppl
u
ier finance programs by requiring new disclosures that would allow a user of the financial
statements to understand the program
s nature, activity during the period, changes from period to period, and potential
magnitude. ASU 2022-04 is effe
f ctive for fiscal years beginning afte
f r December 15, 2022, including interim periods within
those fiscal years, except for the disclosure of the rollforward of annual activity, which is effe
f ctive for fiscal years beginning
afte
f r December 15, 2023. The Company adopted the annual disclosure requirements, except for the rollfor
f
ward of annual
activity, in fiscal 2023. The Company adopted the rollforward of annual activity requirement in fiscal 2024. The effe
f ct of the
adoption of ASU 2022-04 was not material to the Company
s consolidated financial statements.
To Be Adopt
d
ed
t
Afte
f r Fisc
i
al 2024
Income Taxes
a
- Imp
I
rovementst to Income Tax
a Disc
i
losures (ASU 2023-09)
In December 2023, the FASB issued ASU No. 2023-09, Income Taxes
a
- Impr
m
ovements to Income Tax
a Disc
i
losures. This new
guidance requires consistent categories and greater disaggregation of information in the rate reconciliation and greater
disaggregation of income taxes paid by jurisdiction. ASU 2023-09 is effe
f ctive for fiscal years beginning afte
f r December 15,
2024. Early adoption is permitted. The Company is currently evaluating the impact of this amendment on its consolidated
financial statements but does not expect the effe
f ct of the adoption of ASU 2023-09 to be material.
Disa
i
ggregation of Income Statement Expe
x
nses (ASU 2024-03)
In November 2024, the FASB issued ASU No. 2024-03, Disa
i
ggregation of Income Statement Expe
x
nses. This new guidance is
intended to increase transparency and comparability of financial statements by requiring disclosure of significant expense
components for certain expenses on the face of the consolidated statement of operations. The ASU is effe
f ctive for fiscal years
beginning afte
f r December 15, 2026 and for interim periods within fiscal years beginning afte
f r December 15, 2027, with early
adoption permitted. The Company is currently evaluating the impact that this standard will on its consolidated financial
statements but does not expect the effe
f ct of the adoption of ASU 2024-03 to be material.
NOTE 3 - REVENUE RECOGNITION
The Company
s revenues are earned from contracts or arrangements with retail and wholesale customers and licensees.
Contracts include written agreements, as well as arrangements that are implied by customary
r practices or law.
CARTER
S, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
69
Form 10-K

Disaggregation of Revenue
The Company sells its products directly to consumers (direct-to-consumer) and to other retail companies and partners that
subs
u
equently sell the products directly to their own retail customers. The Company also earns royalties from certain of its
licensees. Disaggregated revenues from these sources for the fiscal years presented were as follows:
Fiscal year ended December 28, 2024
(dol
d lars in thousands)s
U.S. Retail
U.S. Wholesale
International
Total
Direct-to-consumer
$
1,417,108
$

$
268,409
$
1,685,517
Wholesale channel

1,021,396
137,189
1,158,585
$
1,417,108
$
1,021,396
$
405,598
$
2,844,102
Royalty income, net
$
5,365
$
11,072
$
2,814
$
19,251
Fiscal year ended December 30, 2023
(dol
d lars in thousands)s
U.S. Retail
U.S. Wholesale
International
Total
Direct-to-consumer
$
1,501,780
$

$
268,596
$
1,770,376
Wholesale channel

1,014,584
160,634
1,175,218
$
1,501,780
$
1,014,584
$
429,230
$
2,945,594
Royalty income, net
$
6,549
$
11,660
$
3,201
$
21,410
Fiscal year ended December 31, 2022
(dol
d lars in thousands)s
U.S. Retail
U.S. Wholesale
International
Total
Direct-to-consumer
$
1,680,159
$

$
279,903
$
1,960,062
Wholesale channel

1,080,471
172,200
1,252,671
$
1,680,159
$
1,080,471
$
452,103
$
3,212,733
Royalty income, net
$
8,815
$
12,915
$
4,090
$
25,820
Accounts Receivable from Customers and Licensees
The components of Accounts receivabl
a e, net, were as follows:
(dol
d lars in thousands)s
December 28, 2024
December 30, 2023
Trade receivabl
a es from wholesale customers, net
$
187,715
$
172,106
Royalties receivabl
a e, net
3,728
4,753
Other receivabl
a es(1)
13,444
20,032
Total receivabl
a es
$
204,887
$
196,891
Less: Wholesale accounts receivabl
a e reserves(2)(3)
(10,053)
(13,117)
Accounts receivabl
a e, net
$
194,834
$
183,774
(1)
Includes tax, payroll, gift card and other receivabl
a es. The balance for the fiscal period ended December 30, 2023 includes a receivabl
a e for a $6.9 million
court approved settlement in December 2023 related to payment card interchange fees. This payment was received in the first quarter of fiscal 2024.
(2)
Includes allowance for chargebacks of $4.4 million and $8.4 million for the periods ended December 28, 2024 and December 30, 2023, respectively.
(3)
Includes allowance for credit losses of $5.7 million and $4.8 million for the periods ended December 28, 2024 and December 30, 2023, respectively.
CARTER
S, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
70

Information regarding Wholesale accounts receivabl
a e reserves is as follows:
(dol
d lars in thousands)s
Wholesale accounts
receivable reserves
Balance at January 1, 2022
$
18,695
Additional provisions
9,280
Charges to reserve
(11,527)
Balance at December 31, 2022
$
16,448
Additional provisions
5,220
Charges to reserve
(8,551)
Balance at December 30, 2023
$
13,117
Additional provisions
2,836
Charges to reserve
(5,900)
Balance at December 28, 2024
$
10,053
Contract Assets and Liabilities
The Company
s contract assets are not material.
Contra
t
ct Liabilit
i
ie
t s
The Company recognizes a contract liabi
a lity when it has received consideration from a customer and has a future obligation to
transfer
f
goods to the customer. Total contract liabi
a lities consisted of the following amounts:
(dol
d lars in thousands)s
December 28, 2024
December 30, 2023
Contract liabi
a lities - current:
Unredeemed gift cards
$
25,043
$
25,162
Unredeemed customer loyalty rewards
2,552
3,355
Carter
s credit card - upfro
f
nt bonus(1)
714
714
Total contract liabi
a lities - current(2)
$
28,309
$
29,231
Contract liabi
a lities - non-current(3)
$

$
714
Total contract liabi
a lities
$
28,309
$
29,945
(1)
The Company received an upfro
f
nt signing bonus from a third-party financial institution, which will be recognized as revenue on a straight-line basis over
the term of the agreement. This amount reflects the current portion of this bonus to be recognized as revenue over the next twelve months.
(2)
Included within Other current liabi
a lities on the Company
s consolidated balance sheet.
(3)
This amount reflects the non-current portion of the Carter
s credit card upfro
f
nt bonus and is included within Other long-term liabi
a lities on the Company
s
consolidated balance sheet.
Composition of Contra
t
ct Liabilities
Unredeemed gift cards - the Company is obligated to transfer
f
goods in the future to customers who have purchased gift cards.
Periodic changes in the gift card contract liabi
a lity result from the purchase of gift cards, the redemption of gift cards by
customers and the recognition of estimated breakage revenue for those gift card balances that are not expected to be redeemed.
Although gift cards do not have an expiration date, the Company classifies all outstanding gift card balances as current
liabi
a lities, as they are redeemable on demand by the valid card holder. The majo
a rity of the Company
s gift cards are redeemed
within one year of issuance. During fiscal 2024 and fiscal 2023, the Company recognized revenue of $10.5 million and
$9.4 million related to the gift card liability balance that existed at December 30, 2023 and December 31, 2022, respectively.
Unredeemed loyalty rewards - points and reward certific
f ates earned by customers under the Company
s loyalty program
represent obligations of the Company to transfer
f
goods to the customer upon redemption. Periodic changes in the loyalty
program contract liabi
a lity result from new rewards earned, reward certific
f ate redemptions and expirations. The earning and
redemption cycles for our loyalty program are under one year in duration.
Carter
s credit card - upfro
f
nt bonus - the Company received an upfro
f
nt bonus from a third-party financial institution, which will
be recognized as revenue on a straight-line basis over the term of the agreement.
CARTER
S, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
71
Form 10-K

NOTE 4  PROPERTY, PLANT, AND EQUIPMENT
Property, plant, and equipment, net consists of the following:
(dol
d lars in thousands)s
December 28, 2024
December 30, 2023
Land, building, and leasehold improvements
$
375,173
$
357,029
Fixtur
t
es, equipment, and computer hardware
301,732
302,747
Computer software(*)
98,563
129,685
Construc
r
tion in progress
8,158
9,557
783,626
799,018
Accumulated depreciation and amortization
(602,670)
(615,907)
Total
$
180,956
$
183,111
(*)
Decrease related to the derecognition of fully depreciated computer software assets that were no longer in service.
Depreciation and amortization expense related to property, plant, and equipment was $54.2 million, $60.4 million, and $61.5
million for fiscal years 2024, 2023, and 2022, respectively.
NOTE 5 - LEASES
The Company has operating leases for retail stores, distribution centers, corporate offi
f ces, data centers, and certain equipment.
The Company
s leases generally have initial terms ranging from 3 years to 10 years, some of which may include options to
extend the leases for up to 5 years, and some of which may include options to early terminate the lease.
As of the periods presented, the Company
s finance leases were not material to the consolidated balance sheets, consolidated
statements of operations, or statement of cash flows.
The following components of lease expense are included in Selling, general, and administrative expenses on the Company
s
consolidated statements of operations for the fiscal periods indicated:
Fiscal year ended
(dol
d lars in thousands)s
December 28, 2024
December 30, 2023
December 31, 2022
Operating lease cost
$
177,034
$
171,072
$
160,210
Variable lease cost(*)
57,992
56,089
66,400
Net lease cost
$
235,026
$
227,161
$
226,610
(*)
Includes short-term leases, which are not material, and any operating lease impairment charges.
Suppl
u
emental balance sheet information related to leases was as follows:
December 28, 2024
December 30, 2023
Weighted average remaining operating lease term (years)
5.9
5.8
Weighted average discount rate for operating leases
5.0%
4.63%
Cash paid for amounts included in the measurement of operating lease liabi
a lities in fiscal 2024 and fiscal 2023 was $175.0
million and $177.8 million, respectively.
Operating lease assets obtained in exchange for operating lease liabi
a lities in fiscal 2024 and fiscal 2023 were $196.3 million and
$184.6 million, respectively. Operating lease assets obtained primarily consist of new or modified leases.
CARTER
S, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
72

As of December 28, 2024, the maturities of lease liabi
a lities were as follows:
(dol
d lars in thousands)s
Operating leases
2025
$
151,728
2026
146,911
2027
115,942
2028
93,103
2029
69,325
Afte
f r 2029
167,329
Total lease payments
$
744,338
Less: Interest
(112,271)
Present value of lease liabi
a lities(*)
$
632,067
(*)
As the rate implicit in the majo
a rity of the Company
s leases is not readily determinable, the Company uses the incremental borrowing rate based on the
information availabl
a e at commencement date, including the lease term and currency, to determine the present value of lease payments.
As of December 28, 2024, the minimum rental commitments for additional operating lease contracts, primarily for retail stores,
that have not yet commenced are $24.7 million. These operating leases will commence in fiscal year 2025 and fiscal year 2026
with lease terms of 7 years to 10 years.
NOTE 6  GOODWILL AND OTHER INTANGIBLE ASSETS
The balances and changes in the carrying amount of Goodwill attributable to each segment were as follows:
(dol
d lars in thousands)s
U.S. Retail
U.S. Wholesale
International
Total
Balance at December 31, 2022(*)
$
83,934
$
74,454
$
50,945
$
209,333
Foreign currency impact


1,204
1,204
Balance at December 30, 2023
$
83,934
$
74,454
$
52,149
$
210,537
Foreign currency impact


(3,662)
(3,662)
Balance at December 28, 2024
$
83,934
$
74,454
$
48,487
$
206,875
(*)
Goodwill attributable to the International segment is net of accumulated impairment losses of $17.7 million.
A summary of the carrying value of the Company
s intangible assets were as follows:
December 28, 2024
December 30, 2023
(dol
d lars in thousands)s
Weighted-
average
useful
f
lifef
Gross
amount
Accumulated
amortization
Net
amount
Gross
amount
Accumulated
amortization
Net
amount
Carter
s tradename
Indefin
f ite
$ 220,233
$

$ 220,233
$ 220,233
$

$ 220,233
OshKos
K
h tradename(1)
Indefinite
40,000

40,000
70,000

70,000
Skip Hop
o tradename
Indefin
f ite
6,000

6,000
6,000

6,000
Finite-lifef tradenames(2)
5 - 20 years
3,911
2,136
1,775
3,911
1,958
1,953
Total tradenames, net
$ 270,144
$
2,136
$ 268,008
$ 300,144
$
1,958
$ 298,186
Skip Hop customer relationships
15 years
$
47,300
$
24,540
$
22,760
$
47,300
$
21,363
$
25,937
Carter
s Mexico customer
relationships
10 years
3,145
2,362
783
3,324
2,023
1,301
Total customer relationships, net
$
50,445
$
26,902
$
23,543
$
50,624
$
23,386
$
27,238
(1)
A non-cash pre-tax impairment charge of $30.0 million on the OshKos
K
h indefinite-lived tradename asset was recorded during fiscal 2024.
(2)
Relates to the acquisition of rights to the Carter
s brand in Chile in December 2014 and the acquisition of the Skip Hop brand in Februa
r
ry 2017.
The carrying values of goodwill and indefinite-lived tradename assets are subj
u ect to annual impairment reviews as of the last
day of each fiscal year. Between annual assessments, impairment reviews may also be triggered by any significant events or
changes in circumstances affe
f cting our business. These impairment reviews are performed in accordance with ASC 350,
In

tangibles--Goodwill and Othe
t
r (ASC 350).
CARTER
S, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
73
Form 10-K

In fiscal 2024, the Company perfor
f
med a quantitative impairment test on the goodwill ascribed to each of the Company
s
reporting units and on the value of its indefinite-lived intangible tradename assets as of December 28, 2024.
The goodwill impairment assessment for each reporting unit was performed in accordance with ASC 350 and compares the
carrying value of each reporting unit to its fair value. Consistent with prior practice, the Company uses a 50% weighting of the
income approach and a 50% weighting of the market approach to determine the fair value of a reporting unit. Based upon this
assessment, there were no impairments on the value of goodwill.
The indefinite-lived tradename asset assessments were performed in accordance with ASC 350 and were determined using a
discounted cash flow analysis which examined the hypothetical cost savings that accrue
r
as a result of not having to license the
tradename from another owner. Based on these assessments, a non-cash pre-tax impairment charge of $30.0 million was
recorded during the fourth quarter of fiscal 2024 on our indefinite-lived OshKos
K
h tradename asset to write-down the carrying
value to $40.0 million. This impairment charge was the result of decreased actua
t
l and projected sales and profita
f
bi
a lity for our
OshKos
K
h brand.
In fiscal 2022, a non-cash pre-tax impairment charge of $9.0 million was recorded during the fourth quarter of fiscal 2022 on
our indefinite-lived Skip Hop tradename asset to write-down the carrying value to $6.0 million. This impairment charge was
due to increased discount rates, decreased actua
t
l and projected sales and profita
f
bi
a lity, and the announcement of the subs
u
tantial
doubt of a Skip Hop
o wholesale customer
s ability to continue to operate as a going concern.
Changes in the carrying values between comparative periods for goodwill related to the International segment were due to
fluctuations in the foreign currency exchange rates primarily between the Canadian and U.S. dollar that were used in the
remeasurement process for preparing the Company
s consolidated financial statements. The changes in the carrying value of
customer relationships for Carter
s Mexico, including the related accumulated amortization, that were not attributable to
amortization expense was also impacted by foreign currency exchange rate fluctuations.
Amortization expense for intangible assets subj
u ect to amortization was $3.7 million for each of fiscal years 2024, 2023, and
2022. Amortization expense is included in SG&A expenses on the Company
s consolidated statements of operations.
The estimated amortization expense for the next five fiscal years is as follows:
(dol
d lars in thousands)s
Amortization expense
2025
$
3,657
2026
$
3,657
2027
$
3,531
2028
$
3,354
2029
$
3,354
NOTE 7  PREPAID EXPENSES AND OTHER CURRENT ASSETS
Prepaid expenses and other current assets at the end of any comparable period, were as follows:
(dol
d lars in thousands)s
December 28, 2024
December 30, 2023
Prepaid information technology-related contracts(*)
14,953
11,504
Prepaid income taxes
4,398
2,563
Other
13,229
15,064
Prepaid expenses and other current assets
$
32,580
$
29,131
(*)
Primarily related to cloud computing arrangements and software maintenance contracts.
CARTER
S, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
74

NOTE 8  OTHER CURRENT LIABILITIES
Other current liabi
a lities at the end of any comparable period, were as follows:
(dol
d lars in thousands)s
December 28, 2024
December 30, 2023
Unredeemed gift cards
$
25,043
$
25,162
Accrue
r
d employee benefits
20,824
17,928
Accrue
r
d taxes
14,455
12,909
Income taxes payabl
a e
13,820
12,697
Accrue
r
d salaries and wages
12,345
12,458
Accrue
r
d bonuses and incentive compensation(*)
2,757
20,817
Other
40,808
32,373
Other current liabilities
$
130,052
$
134,344
(*)
Decrease primarily related to lower than forecasted financial performance in fiscal 2024.
NOTE 9  SUPPLY CHAIN FINANCE PROGRAM
We have establ
a ished a voluntary
r suppl
u
y chain finance (SCF) program through participating financial institutions. This SCF
program enables participating suppl
u
iers to accelerate payments for receivabl
a es due from the Company by selling them directly
to the participating financial institutions at their discretion. As of December 28, 2024, the SCF program has a $70.0 million
revolving capacity. We are not a party to the agreements between the participating financial institutions and the suppl
u
iers in
connection with the SCF program. Payment terms for most of our suppl
u
iers are 60 days, regardless of participation in the SCF
program. The Company does not provide any guarantees under the SCF program.
The Company
s liability related to amounts payabl
a e to the participating financial institution for suppl
u
iers who voluntarily
participate in the SCF program are included in Accounts payabl
a e on our consolidated balance sheets. As of December 28, 2024
and December 30, 2023, amounts under the SCF program included in Accounts payabl
a e were $19.0 million and $14.8 million,
respectively. Payments made in connection with the SCF program, like payments of other accounts payabl
a e, are reflected as a
reduction to our operating cash flow.
The rollfor
f
ward of the Company
s liability related to amounts payabl
a e to the participating financial institution, including new
additions, settlements and the ending balance is as follows:
(dol
d lars in thousands)s
Amounts payable under
SCF program
Outstanding, December 30, 2023
$
14,792
Invoices confir
f med during the year
148,343
Confir
f med invoices paid during the year
(144,092)
Outstanding, December 28, 2024
$
19,043
NOTE 10  LONG-TERM DEBT
Long-term debt consisted of the following:
(dol
d lars in thousands)s
December 28, 2024
December 30, 2023
$500 million, 5.625% Senior Notes due 2027
$
500,000
$
500,000
Less: unamortized debt issuance-related costs
(1,873)
(2,646)
Senior notes, net
$
498,127
$
497,354
Secured revolving credit facility


Total long-term debt, net
$
498,127
$
497,354
Secured Revolving Credit Facility
As of December 28, 2024, the Company had no outstanding borrowings under its secured revolving credit facility, exclusive of
$4.7 million of outstanding letters of credit. As of December 30, 2023, the Company had no outstanding borrowings under its
secured revolving credit facility, exclusive of $4.4 million of outstanding letters of credit. As of December 28, 2024 and
December 30, 2023, there was $845.3 million and $845.6 million availabl
a e for future borrowing, respectively. All outstanding
CARTER
S, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
75
Form 10-K

borrowings under the Company
s secured revolving credit facility are classified as non-current liabi
a lities on the Company
s
consolidated balance sheets due to contractua
t
l repayment terms under the credit facility.
Terms of the Secured Revolving Credit
d
Facility
i
The Company
s secured revolving credit facility provides for an aggregate credit line of $850.0 million which includes a
$750.0 million U.S. dollar facility and a $100.0 million multicurrency facility. The credit facility matures in April 2027. The
facility contains covenants that restrict the Company
s ability to, among other things: (i) create or incur liens, debt, guarantees
or other investments, (ii) engage in mergers and consolidations, (iii) pay dividends or other distributions to, and redemptions
and repurchases from, equity holders, (iv) prepay, redeem or repurchase subor
u
dinated or junior debt, (v) amend organizational
documents, and (vi) engage in certain transactions with affi
f liates.
The Company
s secured revolving credit facility provides for a leverage-based pricing grid which determines an interest rate for
borrowings, calculated as the applicable floating benchmark rate plus a credit spread adju
d stment, if any, plus an amount ranging
from 1.125% to 1.625%, based on leverage. As of December 28, 2024, the borrowing rate for an adju
d sted term Secured
Overnight Financing Rate (SOFR) loan would have been 5.58%, which includes a leverage-based adju
d stment of 1.125%.
As of December 28, 2024, the Company was in compliance with its financial and other covenants under the secured revolving
credit facility.
Senior Notes
2022 Redemption of Senior Notes due 2025
On April 4, 2022, the Company, through its wholly-owned subs
u
idiary, TWCC redeemed $500 million principal amount of
senior notes, bearing interest at a rate of 5.500% per annum, and originally maturing on May 15, 2025. Pursuant to the optional
redemption provisions described in the indentur
t
e dated as of May 11, 2020, TWCC paid the outstanding principal plus accrue
r
d
interest and an appl
a
icable premium as defined in the indentur
t
e. This debt redemption resulted in a loss on extinguishment of
debt of $19.9 million, primarily consisting of $15.7 million of the applicable premium and $4.3 million related to the write-off
of unamortized debt issuance costs.
Senior Notes due 2027
On March 14, 2019, TWCC issued $500 million principal amount of senior notes at par, bearing interest at a rate of 5.625% per
annum, and maturing on March 15, 2027. TWCC may redeem all or part of the senior notes at a redemption price of 100% of
the principal amount of the senior notes, plus accrue
r
d and unpaid interest.
The senior notes mentioned above are unsecured and are fully and unconditionally guaranteed by Carter
s, Inc. and certain
domestic subs
u
idiaries of TWCC. The guarantor subs
u
idiaries are 100% owned directly or indirectly by Carter
s, Inc. and all
guarantees are joint, several and unconditional.
The indentur
t
e governing the senior notes provides that upon the occurrence of specific kinds of changes of control, unless a
redemption notice with respect to all the outstanding senior notes has previously or concurrently been mailed or delivered,
TWCC will be required to make an offe
f r to purchase the senior notes at 101% of their principal amount, plus accrue
r
d and
unpaid interest to (but excluding) the date of purchase.
The indentur
t
e governing the senior notes includes a number of covenants, that, among other things and subj
u ect to certain
exceptions, restrict TWCC
s ability and the ability of certain of its subs
u
idiaries to: (a) incur certain types of indebtedness that is
secured by a lien; (b) enter into certain sale and leaseback transactions; and (c) consolidate or merge with or into, or sell
subs
u
tantially all of the issuer
s assets to, another person, under certain circumstances. Terms of the notes contain customary
r
affi
f rmative covenants and provide for events of default which, if certain of them occur, would permit the trus
r
tee or the holders
of at least 25.0% in principal amount of the then total outstanding senior notes to declare all amounts owning under the notes to
be due and payabl
a e. Carter
s, Inc. is not subj
u ect to these covenants.
CARTER
S, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
76

NOTE 11  COMMON STOCK
Open Market Share Repurchases
The Company repurchased and retired shares in open market transactions in the following amounts for the fiscal periods
indicated:
Fiscal year ended
December 28, 2024
December 30, 2023
December 31, 2022
Number of shares repurchased(1)
736,423
1,446,269
3,747,187
Aggregate cost of shares repurchased (dol
d lars in thousands)s (2)
$
50,526
$
100,034
$
299,667
Average price per share(2)
$
68.61
$
69.17
$
79.97
(1)
Share repurchases were made in compliance with all applicable rules and regulations and in accordance with the share repurchase authorizations.
(2)
The aggregate cost of share repurchases and average price paid per share excludes excise tax on share repurchases imposed as part of the Inflation
Reduction Act of 2022.
On Februa
r
ry 24, 2022, the Company
s Board of Directors authorized share repurchases up to $1.00 billion, inclusive of $301.9
million remaining under previous authorizations. The total remaining capacity under outstanding repurchase authorizations as
of December 28, 2024 was $599.0 million, based on settled repurchase transactions. The share repurchase authorizations have
no expiration dates.
Future repurchases may occur from time to time in the open market, in privately negotiated transactions, or otherwise. The
timing and amount of any repurchases will be at the discretion of the Company subj
u ect to restrictions under the Company
s
secured revolving credit facility, market conditions, stock price, other investment priorities, excise taxes, and other factors.
Dividends
On Februa
r
ry 21, 2025, the Company
s Board of Directors declared a quarterly cash dividend payment of $0.80 per common
share, payabl
a e on March 28, 2025 to shareholders of record at the close of business on March 10, 2025.
In each quarter of fiscal 2024, the Board of Directors declared, and the Company paid, a cash dividend per common share of
$0.80 (for an aggregate cash dividend per common share of $3.20 for fiscal 2024). In fiscal 2023 the Board of Directors
declared, and the Company paid, a cash dividend per common share of $0.75 (for an aggregate cash dividend per common
share of $3.00 for fiscal 2023). Additionally, in each quarter of fiscal 2022, the Board of Directors declared and the Company
paid, a cash dividend per common share of $0.75 (fo
f r an aggregate cash dividend per common share of $3.00 fo
f r fif scal 2022).
Our Board of Directors will evaluate future dividend declarations based on a number of factors, including restrictions under the
Company
s revolving credit facility, business conditions, the Company
s financial performance, and other considerations.
Provisions in the Company
s secured revolving credit facility could have the effe
f ct of restricting the Company
s ability to pay
cash dividends on, or make future repurchases of its common stock, as further described in Note 10, Long-Term Debt,t to the
consolidated financial statements.
NOTE 12  STOCK-BASED COMPENSATION
Under the Company
s Amended and Restated Equity Incentive Plan (the Plan), the Compensation Committee of the Board of
Directors may award incentive stock options, stock appreciation rights, restricted stock (including time-based awards,
performance-based awards, and market-based awards), unrestricted stock, stock deliverable on a deferred basis (including
restricted stock units).
As of December 28, 2024, the maximum number of shares of stock availabl
a e under the Plan was 18,778,392, and there were
1,805,675 remaining shares availabl
a e for grant under the Plan. The Plan makes a provision for the treatment of awards upon
termination of service or in the case of a merger or similar corporate transaction. Participation in the Plan is limited to members
of the Company
s Board of Directors, executive offi
f cers and other key employees.
The limit on shares availabl
a e under the Plan, the individual limits, and other award terms are subj
u ect to adju
d stment to reflect
stock splits or stock dividends, combinations, and certain other events. All stock options issued under the Plan expire no later
than ten years from the date of grant. The Company believes that the current level of authorized shares is sufficient to satisfy
f
future grants for the foreseeabl
a e future.
CARTER
S, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
77
Form 10-K

The Company recorded stock-based compensation cost as follows:
Fiscal year ended
(dol
d lars in thousands)s
December 28, 2024
December 30, 2023
December 31, 2022
Stock options
$

$

$
189
Restricted stock:
Time-based awards
16,388
17,243
17,893
Performance-based awards(*)
(935)
670
2,091
Market-based awards
788


Stock awards
1,600
1,550
1,706
Total
$
17,841
$
19,463
$
21,879
(*)
Decrease in fiscal 2024 and fiscal 2023 relates to the downward revision of estimates for the achievement of performance targets related to certain
performance-based grants. During fiscal 2024, the revision of performance target estimates resulted in a reversal of previously recognized stock-based
compensation expense for outstanding performance-based awards.
As of December 28, 2024, and December 30, 2023, there was no unrecognized compensation costs remaining related to stock
options.
Stock Options
Stock options vest in equal annual installments over a four-year period. The Company issues new shares to satisfy
f stock option
exercises. There were no stock options granted in fiscal 2024, 2023, and 2022.
Changes in the Company
s stock options for the fiscal year ended December 28, 2024 were as follows:
Number of
shares
Weighted-
average exercise
price
Weighted-
average
remaining
contractual
terms (years)
Aggregate
intrinsic value
(in thousands)
Outstanding, December 30, 2023
446,831
$
96.20
Granted(*)

$

Exercised
(4,408) $
83.32
Forfeited

$

Expired
(53,397) $
95.26
Outstanding, December 28, 2024
389,026
$
96.47
1.96
$

Vested and expected to vest, December 28, 2024
389,026
$
96.47
1.96
$

Exercisable, December 28, 2024
389,026
$
96.47
1.96
$

(*)
The Company did not grant any stock options in fiscal 2024.
The intrinsic value of stock options exercised during the fiscal years ended December 28, 2024, December 30, 2023, and
December 31, 2022 was $0.1 million, $0.3 million, and $1.4 million, respectively.
Restricted Stock Awards
Restricted stock awards issued under the Plan vest based upon: 1) continued service (time-based) 2) a combination of continued
service and performance targets (performance-based) or 3) a combination of continued service and the Company
s relative total
shareholder return (market-based).
CARTER
S, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
78

The following tabl
a e summarizes activity related to all restricted stock awards during the fiscal year ended December 28, 2024:
Restricted
stock
awards
Weighted-average
grant date fair value
per award
Outstanding, December 30, 2023
755,289
$
84.63
Granted
372,933
$
80.32
Vested
(254,244) $
89.57
Forfeited
(51,327) $
82.04
Outstanding, December 28, 2024
822,651
$
81.31
During fiscal 2023, a total of 184,803 shares of restricted stock vested with a weighted-average fair value of $91.84 per share.
During fiscal 2022, a total of 205,120 shares of restricted stock vested with a weighted-average fair value of $95.54 per share.
At December 28, 2024, there was $30.8 million of unrecognized compensation cost (net of estimated forfei
f tures) related to all
restricted stock awards which is expected to be recognized over a weighted-average period of approximately 2.5 years.
Time
i
-based Restri
t cted
t
Stoc
t
k Awards
d
Fiscal year
Number of awards granted
Weighted-average grant
date fair value per award
2022
230,625
$
90.06
2023
272,509
$
73.80
2024
266,539
$
77.00
Time-based restricted stock awards vest in equal annual installments or clifff vest afte
f r a three-year or four-year period. During
fiscal years 2024, 2023, and 2022, a total of 254,244 shares, 184,803 shares, and 162,508 shares, respectively, of time-based
restricted stock vested with a weighted-average fair value of $89.57 per share, $91.84 per share, and $97.29 per share,
respectively. At December 28, 2024, there was $26.4 million of unrecognized compensation cost (net of estimated forfeitur
t
es)
related to time-based restricted stock which is expected to be recognized over a weighted-average period of approximately 2.5
years.
Perfor
f
ma
r
nce-based Restri
t cted
t
Stoc
t
k Awards
d
Fiscal year
Number of awards granted
Weighted-average grant
date fair value per award
2022
89,760
$
91.12
2023
112,284
$
74.06
2024
55,089
$
81.95
Performance-based restricted stock awards clifff vest afte
f r a three-year period, subj
u ect to the achievement of the performance
target. During the fiscal years 2024 and 2023, no performance shares vested. During fiscal 2022, 42,612 performance shares
vested. As of December 28, 2024, a total of 237,697 performance shares were unvested with a weighted-average fair value of
$81.38 per share. As of December 28, 2024, there was $2.3 million unrecognized compensation cost (net of estimated
forfeitures) related to the unvested performance-based restricted stock awards based which is expected to be recognized over a
weighted-average period of approximately 1.9 years. The Company recognizes compensation cost ratabl
a y over the applicable
performance periods based on the estimated probabi
a lity of achievement of its performance targets at the end of each period.
Market-b
t
ased Restri
t cted
t
Stoc
t
k Awards
Fiscal year
Number of awards granted
Weighted-average grant
date fair value per award
2024
28,375
$
117.28
The market-based restricted stock awards clifff vest afte
f r a three-year period, subj
u ect to the performance of the Company
s TSR
relative to the TSR of a select group of peer companies over the three-year period. A Monte-Carlo simulation was utilized to
determine the grant-date fair value of the market-based restricted stock awards, using the following assumptions: beginning
CARTER
S, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
79
Form 10-K

TSR price of $73.60, grant date share price of $81.95, simulation term of 3 years, expected volatility of 32.9%, and risk-free
interest rate of 4.5%.
As of December 28, 2024, a total of 28,375 market-based restricted shares were unvested with a weighted-average fair value of
$117.28 per share. As of December 28, 2024, there was $2.2 million unrecognized compensation cost (net of estimated
forfeitures) related to the unvested market-based restricted stock awards based which is expected to be recognized over a
weighted-average period of approximately 2.2 years.
Stoc
t
k Awards
d
Included in restricted stock awards are grants to non-management members of the Company
s Board of Directors. At issuance,
these awards were fully vested and issued as shares of the Company
s common stock. The Company records the stock-based
compensation expense immediately as there are no vesting terms. During fiscal years 2024, 2023, and 2022, such awards were
as follows:
Fiscal year
Number of shares issued
Weighted-average grant
date fair value per share
2022
21,725
$
78.51
2023
23,850
$
65.01
2024
22,930
$
69.78
The Company received no proceeds from the issuance of these shares.
NOTE 13  ACCUMULATED OTHER COMPREHENSIVE (LOSS) INCOME
The components of Accumulated other comprehensive (loss) income consisted of the following:
(dol
d lars in thousands)s
Pension liability
adju
d
stments(*)y
Post-retirement
liability
adju
d
stments
Cumulative
translation
adju
d
stments
Accumulated
other
comprehensive
(loss) income
Balance at January 1, 2022
$
(8,920) $
1,325
$
(21,302) $
(28,897)
Fiscal year 2022 change
1,739
344
(7,524)
(5,441)
Balance at December 31, 2022
(7,181)
1,669
(28,826)
(34,338)
Fiscal year 2023 change
160
(330)
10,593
10,423
Balance at December 30, 2023
(7,021)
1,339
(18,233)
(23,915)
Fiscal year 2024 change
2,000
(274)
(21,489)
(19,763)
Balance at December 28, 2024
$
(5,021) $
1,065
$
(39,722) $
(43,678)
(*)
Includes reclassification adju
d stments for deferred losses on pension obligations of $0.7 million (net of income taxes of $0.2 million) related to the partial
settlement of the pension plan in fiscal 2024.
As of December 28, 2024 and December 30, 2023, the cumulative tax effe
f ct on the pension liabi
a lity adju
d stments were
$1.6 million and $2.2 million, respectively. As of December 28, 2024 and December 30, 2023, the cumulative tax effe
f ct on the
post-retirement liability adju
d stments were $0.3 million and $0.4 million, respectively.
For the fiscal years ended December 28, 2024 and December 30, 2023, amounts reclassified from Accumulated other
comprehensive loss to the consolidated statements of operations consisted of the partial settlement of the pension plan in fiscal
2024 and the amortization of actuarial gains and losses related to the Company
s defined benefit pension plan and defined
benefit post-retirement plans. The partial pension settlement charge was recorded in Other expense (income), net on the
Company
s consolidated statement of operations. The amortization of actua
t
rial gains and losses amounts are included in the net
periodic cost or benefit recognized for these plans during the respective fiscal year. For additional information, see Note 17,
Empl
m oyee Benefit
e
Plans, to the consolidated financial statements.
NOTE 14  FAIR VALUE MEASUREMENTS
Investments
The Company invests comparable amounts in marketable securities, principally equity-based mutual funds, to approximate the
participant
s investment return on employee deferrals of compensation. All of the marketable securities are included in Other
assets on the accompanying consolidated balance sheets, and their aggregate fair values were $19.5 million and $17.3 million at
the end of fiscal 2024 and fiscal 2023, respectively. These investments are classified as Level 1 within the fair value hierarchy.
CARTER
S, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
80

The change in the aggregate fair values of marketable securities is due to the net activity of gains and losses and any
contributions and distributions during the period. Gains on the investments in marketable securities were $2.2 million for fiscal
2024 and fiscal 2023. These amounts are included in Other expense (income), net on the Company
s consolidated statement of
operations.
The fair value of the Company
s pension plan assets at December 28, 2024 and December 30, 2023, by asset category,
r
are
disclosed in Note 17, Empl
m oyee Benefit
e
st Plans, to the consolidated financial statements.
Borrowings
As of December 28, 2024, the Company had no outstanding borrowings under its secured revolving credit facility.
The fair value of the Company
s senior notes was $494.4 million and $493.7 million at December 28, 2024 and December 30,
2023, respectively. The fair value of these senior notes with a notional value and carrying value (gross of debt issuance costs) of
$500.0 million was estimated using a quoted price as provided in the secondary market, which considers the Company
s credit
risk and market related conditions, and is therefor
f
e within Level 2 of the fair value hierarchy.
Goodwill, Intangible, and Other Long-Lived Assets
Some assets are not measured at fair value on a recurring basis but are subj
u ect to fair value adju
d stments only in certain
circumstances. These assets can include goodwill, indefinite-lived intangible assets, and other long-lived assets that have been
reduced to fair value when impaired. Assets that are written down to fair value when impaired are not subs
u
equently adju
d sted to
fair value unless further impairment occurs.
In fiscal 2024, the Company perfor
f
med a quantitative impairment test on the goodwill ascribed to each of the Company
s
reporting units and on the value of its indefinite-lived intangible tradename assets as of December 28, 2024.
The goodwill impairment assessment for each reporting unit was performed in accordance with ASC 350 and compares the
carrying value of each reporting unit to its fair value. Consistent with prior practice, the Company uses a 50% weighting of the
income approach and a 50% weighting of the market approach to determine the fair value of a reporting unit. Based upon this
assessment, there were no impairments on the value of goodwill.
The indefinite-lived tradename asset assessments were performed in accordance with ASC 350 and were determined using a
discounted cash flow analysis which examined the hypothetical cost savings that accrue
r
as a result of not having to license the
tradename from another owner. Based on these assessments, a non-cash pre-tax impairment charge of $30.0 million was
recorded during the fourth quarter of fiscal 2024 on our indefinite-lived OshKos
K
h tradename asset to write-down the carrying
value to $40.0 million. This impairment charge was the result of decreased actua
t
l and projected sales and profita
f
bi
a lity for our
OshKos
K
h brand.
NOTE 15  INCOME TAXES
Provision for Income Taxes
The provision for income taxes consisted of the following:
Fiscal year ended
(dol
d lars in thousands)s
December 28, 2024
December 30, 2023
December 31, 2022
Current tax provision:
p
Federal
$
33,397
$
47,643
$
43,569
State
7,422
8,943
8,307
Foreign
10,903
13,756
15,562
Total current provision
$
51,722
$
70,342
$
67,438
Deferred tax (benefit
f ) provision:
(
) p
Federal
$
(3,965) $
(148) $
(1,484)
State
(25)
(512)
425
Foreign
(2,432)
60
319
Total deferred benefit
(6,422)
(600)
(740)
Total provision
$
45,300
$
69,742
$
66,698
CARTER
S, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
81
Form 10-K

The foreign portion of the tax position subs
u
tantially relates to the Company
s international operations in Canada, Hong Kong
and Mexico, in addition to foreign tax withholdings related to the Company
s foreign royalty income.
The Company plans to repatriate undistributed earnings from Hong Kong and has provided for deferred income taxes related to
these earnings. Since the current U.S. tax regime taxes foreign earnings in the year earned, taxes associated with repatriation are
not material. Deferred income taxes have not been provided for undistributed foreign earnings from Canada or Mexico, or any
additional outside basis difference inherent in all foreign entities, as these amounts continue to be indefinitely reinvested in
foreign operations. Total undistributed earnings from the Company
s subs
u
idiaries in Canada and Mexico amounted to $101.3
million. Unrecognized deferred tax liability related to undistributed earnings from the Company
s subs
u
idiaries in Canada and
Mexico is estimated to be approximately $4.8 million, based on applicable withholding taxes, levels of foreign income
previously taxed in the U.S. and applicable foreign tax credit limitations. The company accounts for the additional U.S. income
tax on its foreign earnings under Global Intangible Low-Taxed Income (GILTI) as a period expense in the period in which
additional tax is due.
The components of income before income taxes were as follows:
Fiscal year ended
(dol
d lars in thousands)s
December 28, 2024
December 30, 2023
December 31, 2022
Domestic
$
167,741
$
240,627
$
227,929
Foreign
63,068
61,615
88,807
Total
$
230,809
$
302,242
$
316,736
Effe
f ctive Rate Reconciliation
The difference between the Company
s effe
f ctive income tax rate and the federal statut
t ory
r tax rate is reconciled below:
Fiscal year ended
December 28, 2024
December 30, 2023
December 31, 2022
Statut
t ory
r federal income tax rate
21.0 %
21.0 %
21.0 %
State income taxes, net of federal income tax benefit
2.9 %
3.0 %
2.8 %
Impact of foreign operations
(3.4)%
(0.8)%
(2.0)%
Settlement of uncertain tax positions
(0.5)%
(0.6)%
(0.7)%
Benefit from stock-based compensation
 %
 %
(0.1)%
Other
(0.4)%
0.5 %
0.1 %
Total
19.6 %
23.1 %
21.1 %
The Company and its subs
u
idiaries file a consolidated United States federal income tax return, as well as separate and combined
income tax returns in numerous state and foreign jurisdictions. In most cases, the Company is no longer subj
u ect to U.S. tax
authority examinations for years prior to fiscal 2021.
CARTER
S, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
82

Deferred Taxes
The following tabl
a e reflects the Company
s calculation of the components of deferred tax assets and liabi
a lities as of
December 28, 2024 and December 30, 2023.
(dol
d lars in thousands)s
December 28, 2024
December 30, 2023
Deferred tax assets:
Assets (Liabi
a lities)
Accounts receivabl
a e allowance
$
4,321
$
5,263
Inventory
r
12,408
14,271
Accrue
r
d liabi
a lities
8,810
11,208
Equity-based compensation
3,886
3,511
Deferred employee benefits
3,062
3,397
Leasing liabi
a lities
128,904
105,756
Other
5,078
4,771
Total deferred tax assets
166,469
148,177
Deferred tax liabilities:
Depreciation
(19,060)
(19,654)
Leasing assets
(115,419)
(93,943)
Tradename and licensing agreements
(63,144)
(71,361)
Other
(2,712)
(2,516)
Total deferred tax liabi
a lities
(200,335)
(187,474)
Net deferred tax liabi
a lity
$
(33,866) $
(39,297)
Amounts recognized in the consolidated balance sheets:
(dol
d lars in thousands)s
December 28, 2024
December 30, 2023
Assets (Liabi
a lities)
Deferred tax assets
$
4,344
$
2,173
Deferred tax liabi
a lities
(38,210)
(41,470)
Net deferred tax liabi
a lity
$
(33,866) $
(39,297)
Uncertain Tax Positions
The following is a reconciliation of the beginning and ending amount of unrecognized tax benefits:
(dol
d lars in thousands)s
Balance at January 1, 2022
$
8,856
Additions based on tax positions related to fiscal 2022
1,040
Reductions for prior year tax positions

Reductions for laps
a
e of statut
t e of limitations
(2,803)
Balance at December 31, 2022
$
7,093
Additions based on tax positions related to fiscal 2023
1,545
Reductions for prior year tax positions

Reductions for laps
a
e of statut
t e of limitations
(2,373)
Balance at December 30, 2023
$
6,265
Additions based on tax positions related to fiscal 2024
1,500
Reductions for prior year tax positions

Reductions for laps
a
e of statut
t e of limitations
(1,255)
Balance at December 28, 2024
$
6,510
As of December 28, 2024, the Company had gross unrecognized tax benefits of $6.5 million, of which $5.7 million, if
ultimately recognized, will affe
f ct the Company
s effe
f ctive tax rate in the period settled. The Company has recorded tax
CARTER
S, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
83
Form 10-K

positions for which the ultimate deductibility is more likely than not, but for which there is uncertainty about the timing of such
deductions. Because of deferred tax accounting, changes in the timing of these deductions would not affe
f ct the annual effe
f ctive
tax rate but would accelerate the payment of cash to the taxing authorities.
Included in the reserves for unrecognized tax benefits are $1.5 million of reserves for which the statut
t e of limitations is
expected to expire within the next fiscal year. If these tax benefits are ultimately recognized, such recognition, net of federal
income taxes, may affe
f ct the annual effe
f ctive tax rate for fiscal 2025 and the effe
f ctive tax rate in the quarter in which the
benefits are recognized.
The Company recognizes interest related to unrecognized tax benefits as a component of interest expense and penalties related
to unrecognized tax benefits as a component of income tax expense. During fiscal 2024, fiscal 2023, and fiscal 2022, expense
recorded on uncertain tax positions was not material. The Company had accrue
r
d interest on uncertain tax positions of $1.6
million and $1.5 million as of December 28, 2024 and December 30, 2023, respectively.
NOTE 16  EARNINGS PER SHARE
The following is a reconciliation of basic common shares outstanding to diluted common and common equivalent shares
outstanding:
Fiscal year ended
December 28,
2024
December 30,
2023
December 31,
2022
Weighted-average number of common and common equivalent shares outstanding:
g
g
q
g
Basic number of common shares outstanding
35,524,378
36,589,922
38,822,737
Dilutive effe
f ct of equity awards
1,238
3,344
27,908
Diluted number of common and common equivalent shares outstanding
35,525,616
36,593,266
38,850,645
Earnings per share:
g p
(dol
d lars in thousands, except per share data)
Basic net income per common share:
Net income
$
185,509
$
232,500
$
250,038
Income allocated to participating securities
(3,679)
(4,285)
(3,714)
Net income availabl
a e to common shareholders
$
181,830
$
228,215
$
246,324
Basic net income per common share
$
5.12
$
6.24
$
6.34
Diluted net income per common share:
Net income
$
185,509
$
232,500
$
250,038
Income allocated to participating securities
(3,679)
(4,285)
(3,712)
Net income availabl
a e to common shareholders
$
181,830
$
228,215
$
246,326
Diluted net income per common share
$
5.12
$
6.24
$
6.34
Anti-dilutive shares excluded from dilutive earnings per share calculations (*)
422,865
477,373
526,618
(*)
The volume of antidilutive shares is, in part, due to the related unamortized compensation costs.
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 purpos
r
es of computing diluted earnings per
share (EPS), and therefor
f
e 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.
CARTER
S, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
84

NOTE 17  EMPLOYEE BENEFIT PLANS
The Company maintains defined contribution plans, a deferred compensation plan, and two defined benefit plans. The two
defined benefit plans include the OshKosh B
Gosh pension plan and a post-retirement lifef and medical plan.
OshKosh B
Gosh Pension Plan
Partia
t l Terminatio
t n
During the second quarter of fiscal 2024, the Company announced the offe
f ring of a single-sum payment option to certain
participants in the frozen OshKosh B
Gosh, Inc. Pension Plan (the pension plan), which commenced on June 1, 2024 and
closed on July 15, 2024. In August 2024, the pension plan paid $6.9 million from pension plan assets to electing participants,
thereby reducing its pension benefit obligations. The transaction had no cash impact on the Company but did result in a non-
cash pre-tax partial pension settlement charge of $0.9 million, which is included in Other expense (income), net on the
Company
s consolidated statement of operations.
Additionally, the Board of Directors authorized the termination of the pension plan, with an effe
f ctive date of November 30,
2024. The Company may be required to make a contribution to fully fund the plan for termination prior to the purchase of a
group annuity contract to transfer
f
its remaining liabilities under the pension plan. The contribution amount will depend upon the
nature and timing of participant settlements and prevailing market conditions. The Company expects to recognize a non-cash
charge upon settlement of the pension plan
s obligations in the second half of fiscal 2025. The Company has the right to change
the effe
f ctive date of the termination date or revoke the decision to terminate, but it has no current intent to do so.
Funded
d
Stat
t us
The retirement benefits under the pension plan were frozen as of December 31, 2005. A reconciliation of changes in the
projected pension benefit obligation and plan assets is as follows:
Fiscal year ended
(dol
d lars in thousands)s
December 28, 2024
December 30, 2023
Change in projected benefit obligation:
Projected benefit obligation at beginning of year
$
54,785
$
53,847
Interest cost
2,401
2,617
Actuarial (gain) loss
(4,202)
1,376
Benefits paid
(3,021)
(3,055)
Effe
f ct of settlement
(6,886)

Projected benefit obligation at end of year
$
43,077
$
54,785
Change in plan assets:
Fair value of plan assets at beginning of year
$
55,959
$
55,245
Actual return on plan assets
(503)
3,769
Benefits paid
(3,021)
(3,055)
Effe
f ct of settlement
(6,886)

Fair value of plan assets at end of year
$
45,549
$
55,959
Funded status
$
2,472
$
1,174
The accumulated benefit obligation is equal to the projected benefit obligation as of December 28, 2024 and December 30,
2023 because the plan is frozen. The Company does not expect to make any contributions to the pension plan during fiscal 2025
as the plan
s funding exceeds the minimum funding requirements.
The actua
t
rial gain in fiscal 2024 was primarily attributable to increased discount rates and the removal of participants electing
to receive a single-sum payment from the pension plan. The actuarial loss in fiscal 2023 was primarily attributable to decreased
discount rates. The funded status
t
asset is included in Other assets in the Company
s consolidated balance sheet.
CARTER
S, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
85
Form 10-K

Net Periodic Pension Cost and Changes Recogn
o
ized in Othe
t
r Comprehensive Income
The components of net periodic pension cost recognized in the statement of operations and changes recognized in other
comprehensive income were as follows:
Fiscal year ended
(dol
d lars in thousands)s
December 28, 2024
December 30, 2023
December 31, 2022
Recognized in the statement of operations:
Interest cost
$
2,401
$
2,617
$
1,909
Expected return on plan assets
(2,176)
(2,372)
(3,432)
Amortization of net loss(*)
148
189
217
Partial pension plan settlement charge(*)
949


Net periodic pension cost (benefit)
f
$
1,322
$
434
$
(1,306)
Changes recognized in other comprehensive income:
Net gain arising during the fiscal year
$
(1,523) $
(21) $
(2,062)
Amortization of net loss(*)
(148)
(189)
(217)
Partial pension plan settlement charge(*)
(949)


Total changes recognized in other comprehensive income
$
(2,620) $
(210) $
(2,279)
Total net periodic pension cost (benefit
f ) and changes recognized
in other comprehensive income
$
(1,298) $
224
$
(3,585)
(*)
Represents pre-tax amounts reclassified from accumulated other comprehensive loss.
Assumptions
The actua
t
rial assumptions used in determining the benefit obligation and net periodic pension cost for our pension plan is
presented in the following tabl
a e:
Benefit obligation
g
2024
2023
Discount rate
5.50%
4.75%
Net periodic pension cost
p
p
2024
2023
2022
Discount rate
4.75%
5.00%
2.75%
Expected long-term rate of return on plan assets
4.75%
5.00%
5.50%
The discount rates used at December 28, 2024, December 30, 2023, and December 31, 2022 were determined with
consideration given to the FTSE Pension Liability Index and the Bloomberg US Aggregate AA Bond Index, adju
d sted for the
timing of expected plan distributions. The Company believes these indexes reflect a risk-free rate consistent with a portfol
f io of
high quality debt instruments with maturities that are comparable to the timing of the expected payments under the plan. The
expected long-term rate of return assumption is equal to the assumed discount rate. Refer to Plan Assets below in Note 17,
Empl
m oyee Benefit
e
Plans for further discussion.
The increased discount rate assumption at December 28, 2024 resulted in an decrease in the amount of the pension plan
s
projected benefit obligation of approximately $3.1 million. A 0.25% change in the assumed discount rate as of December 28,
2024 would result in an increase or decrease in the amount of the pension plan's projected benefit obligation of approximately
$1.0 million.
CARTER
S, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
86

The Company currently expects benefit payments for its defined benefit pension plan as follows for the next ten fiscal years:
(dol
d lars in thousands)s
2025
$
3,300
2026
$
3,300
2027
$
3,460
2028
$
3,420
2029
$
3,420
2030-2034
$
17,120
Plan
l
Assets
The Company conducts periodic asset-liabi
a lity studi
t
es for our defined benefit pension plan to develop a policy glide path which
adju
d sts the asset allocation with funded status
t
. During fiscal 2022, the plan became fully funded, and the Company allocated its
investments to fixed income securities as a result. These fixed income securities include funds holding corporate bonds of
companies from diverse industries and U.S. Treasuries. The expected long-term rate of return on plan assets is 5.50%.
The fair value of the Company
s pension plan assets at December 28, 2024 and December 30, 2023, by asset category,
r
were as
follows:
(dol
d lars in thousands)s
December 28, 2024
December 30, 2023
Asset category
g
y
Total
Level 1
Level 2
Total
Level 1
Level 2
Fixe
i
d income securitie
i
s:
Corporate bonds(*)
$
45,549
$
45,549
$

$
55,959
$
55,959
$

(*)
This category
r invests in both U.S. Treasuries and corporate debt from U.S. issuers from diverse industries.
Post-retirement Life and Medical Plan
Under a defined benefit plan frozen in 1991, the Company offe
f rs a comprehensive post-retirement medical plan to current and
certain future retirees and their spouses. The Company also offe
f rs lifef insurance to current and certain future retirees. Employee
contributions are required as a condition of participation for both medical benefits and lifef insurance and the Company
s
liabi
a lities are net of these expected employee contributions.
Accumulated Post-R
t
etir
t ement Benefi
e ti Obligatio
t n
The following is a reconciliation of the accumulated post-retirement benefit obligation (APBO) under this plan:
Fiscal year ended
(dol
d lars in thousands)s
December 28, 2024
December 30, 2023
APBO at beginning of fiscal year
$
1,637
$
1,745
Service cost
7
6
Interest cost
73
78
Actuarial (gain) loss
(51)
3
Benefits paid
(172)
(195)
APBO at end of fiscal year
$
1,494
$
1,637
Approximately $1.3 million and $1.4 million of the APBO at the end of fiscal 2024 and 2023, respectively, were classified as
Other long term liabilities in the Company
s consolidated balance sheets.
CARTER
S, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
87
Form 10-K

Net Periodic Post-R
t
etir
t ement Benefi
e ti Cost and Changes Recogn
o
ized in Othe
t
r Comprehensive Income
The components of net periodic post-retirement benefit cost recognized in the statement of operations and changes recognized
in other comprehensive income were as follows:
Fiscal year ended
(dol
d lars in thousands)s
December 28, 2024
December 30, 2023
December 31, 2022
Recognized in the statement of operations:
Service cost
$
7
$
6
$
14
Interest cost
73
78
63
Amortization of net gain(*)
(405)
(428)
(320)
Net periodic post-retirement benefit (income) cost
$
(325) $
(344) $
(243)
Changes recognized in other comprehensive income:
Net (gain) loss arising during the fiscal year
$
(51) $
3
$
(763)
Amortization of net gain(*)
405
428
320
Total changes recognized in other comprehensive income
$
354
$
431
$
(443)
Total net periodic post-retirement benefit cost (income)
and changes recognized in other comprehensive income
$
29
$
87
$
(686)
(*)
Represents pre-tax amounts reclassified from accumulated other comprehensive loss.
Assumptions
The actua
t
rial computations utilized the following assumptions, using year-end measurement dates:
Post-retirement benefit obligation
g
2024
2023
Discount rate
5.25%
4.75%
Net periodic post-retirement benefit cost
p
p
2024
2023
2022
Discount rate
4.75%
4.75%
2.50%
The discount rates used at December 28, 2024, December 30, 2023, and December 31, 2022, were determined with primary
r
consideration given to the FTSE Pension Discount Curve and Liability Index adju
d sted for the timing of expected plan
distributions. The Company believes this index reflects a risk-free rate with maturities that are comparable to the timing of the
expected payments under the plan.
The effe
f cts on the Company
s plan of all future increases in health care costs are borne primarily by employees; accordingly,
increasing medical costs are not expected to have any material effe
f ct on the Company
s future financial results.
The Company
s contribution for these post-retirement benefit obligations was $0.2 million for fiscal years 2024, 2023, and
2022. The Company expects that its contribution and benefit payments for post-retirement benefit obligations will be
approximately $0.2 million for fiscal years 2025, 2026, 2027, 2028, and 2029. For the five years subs
u
equent to fiscal 2029, the
aggregate contributions and benefit payments for post-retirement benefit obligations is expected to be approximately $0.6
million. The Company does not pre-fund this plan and as a result there are no plan assets.
Deferred Compensation Plan
The Company maintains a deferred compensation plan allowing voluntary
r salary and incentive compensation deferrals for
qualifyi
f ng employees as permitted by the Internal Revenue Code. Participant deferrals earn investment returns based on a select
number of investment options, including equity, debt, and real estate mutual funds. Deferred compensation plan liabi
a lities are
recognized in Other long term liabilities on the Company
s consolidated balance sheets. Changes in the balance, excluding
those related to contributions or payments, are included in Other expense (income), net on the Company
s consolidated
statement of operations. The Company invests comparable amounts in marketable securities to approximate the participant
s
return on selected investment options.
CARTER
S, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
88

Defined Contribution Plan
The Company also sponsors defined contribution savings plans in the United States and Canada. The U.S. plan covers
employees who are at least 21 years of age and have completed one calendar month of service and, if part-time, work a
minimum of one thousand hours of service within the one-year period following the commencement of employment or during
any subs
u
equent calendar year. The plan provides for a discretionary employer match of employee contributions. The
Company
s expense for the U.S. defined contribution savings plan totaled $8.6 million, $8.1 million, and $8.2 million for the
fiscal years ended December 28, 2024, December 30, 2023, and December 31, 2022, respectively.
NOTE 18  SEGMENT INFORMATION
The Company reports segment information based upon a management approach. The management approach refers to the
internal reporting that is used by management for making operating decisions and assessing the performance of the Company
s
reportabl
a e segments.
The Company has identifie
f d three operating and reportabl
a e segments: U.S. Retail, U.S. Wholesale, and International. The U.S.
Retail segment consists of revenue primarily from sales of products in the United States through our retail stores and
eCommerce websites. Similarly, the U.S. Wholesale segment consists of revenue primarily from sales in the United States of
products to our wholesale partners. The International segment consists of revenue primarily from sales of products outside the
United States, largely through our retail stores and eCommerce websites in Canada and Mexico, and sales to our international
wholesale customers and licensees. The Company sells similar products in each of its three segments.
The Company
s chief operating decision maker is the Chief Executive Offi
f cer. The chief operating decision maker evaluates
the operating performance of the segments based upon each segment
s net sales and segment operating income. Segment
operating income includes net sales, royalty income, and related cost of goods sold and selling, general, and administrative
expenses attributable to each segment. Segment operating income excludes unallocated corporate expenses as well as specific
charges that are not directly attributable to segment operations, including restructur
t
ing costs and impairment charges related to
goodwill and indefinite-lived intangible assets.
In fiscal 2024, the Company changed its measure of segment profita
f
bi
a lity to segment operating income, which excludes the
charges mentioned above, and which were included in our previous measure of segment profita
f
bi
a lity, to better align with
management
s assessment of segment performance and to provide better insights into segment performance. Prior period
segment operating income for the fiscal years ended December 30, 2023 and December 31, 2022 has been recast to confor
f
m to
the current presentation.
The chief operating decision maker uses both net sales and segment operating income for each segment predominantly in the
annual budget and quarterly forecasting process. On a quarterly basis, the chief operating decision maker considers budget-to-
actua
t
l variances and a comparison of segment results for evaluating performance of each segment and making decisions about
the allocation of operating and capital resources to each segment. The Company does not evaluate performance or allocate
resources based on segment asset data, and therefor
f
e total segments assets are not presented.
Segment operating income include the direct costs of each segment and all other costs are allocated based upon detailed
estimates and analysis of actual time and expenses incurred to suppor
u
t the operations of each segment or units produced or
sourced to suppor
u
t each segment
s revenue. Certain costs, including incentive compensation for certain employees, and various
other general corporate costs that are not specifically allocabl
a e to segments, are included in unallocated corporate expenses
below. Intersegment sales are treated as a transfer
f
of inventory
r and are not included in segment results for management
reporting. The accounting policies of the segments are the same as those described in Note 2, Summary of Signi
i
fi
i cant
Accounting Policies, to the consolidated financial statements.
CARTER
S, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
89
Form 10-K

Segment Perfor
f
mance
The tabl
a es below present certain segment information for our reportabl
a e segments for the periods indicated:
Fiscal year ended December 28, 2024
(dol
d lars in thousands)s
U.S. Retail
U.S. Wholesale
International
Total
Net sales
$
1,417,108
$
1,021,396
$
405,598
$
2,844,102
Cost of goods sold(1)
567,435
705,550
205,951
1,478,936
Selling expenses(2)
489,481
9,591
103,566
602,638
Distribution expenses(3)
89,368
62,875
24,607
176,850
Other segment items(4)
137,898
26,400
32,504
196,802
Segment operating income
$
132,926
$
216,980
$
38,970
$
388,876
(1)
Refer
f
to Note 2, Summary of Signi
i
fic
i
ant Accounting Policies for additional information on the components of Cost of goods sold.
(2)
Selling expenses include the costs of operating our retail stores and eCommerce channels, as well as wholesale sales management costs.
(3)
Distribution expenses include payments to third-party shippers and handling costs to process product through our distribution facilities, including
eCommerce fulfillme
f
nt costs, and delivery
r to our wholesale customers and to our retail stores.
(4)
Other segment items include royalty income and overhead costs that are attributable to our reportabl
a e segments and include allocated accounting, finance,
human resources, and information technology expenses, occupa
u
ncy costs, and other benefit and compensation programs, including performance-based
compensation.
Fiscal year ended December 30, 2023
(dol
d lars in thousands)s
U.S. Retail
U.S. Wholesale
International
Total
Net sales
$
1,501,780
$
1,014,584
$
429,230
$
2,945,594
Cost of goods sold
602,152
717,936
229,571
1,549,659
Selling expenses
506,709
8,363
95,155
610,227
Distribution expenses
95,354
63,188
24,903
183,445
Other segment items
106,923
26,152
34,470
167,545
Segment operating income
$
190,642
$
198,945
$
45,131
$
434,718
Fiscal year ended December 31, 2022
(dol
d lars in thousands)s
U.S. Retail
U.S. Wholesale
International
Total
Net sales
$
1,680,159
$
1,080,471
$
452,103
$
3,212,733
Cost of goods sold
689,543
800,974
249,858
1,740,375
Selling expenses
521,516
9,402
89,452
620,370
Distribution expenses
113,455
78,079
24,653
216,187
Other segment items
102,788
24,777
28,462
156,027
Segment operating income
$
252,857
$
167,239
$
59,678
$
479,774
CARTER
S, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
90

The tabl
a e below presents a reconciliation of reportabl
a e segment operating income to Income before income taxes:
Fiscal year ended
December 28, 2024
December 30, 2023
December 31, 2022
Total segment operating income
$
388,876
$
434,718
$
479,774
Items not included in segment operating income:
Unallocated corporate expenses(1)
(102,326)
(106,901)
(91,603)
Organizational restructur
t
ing(2)
(1,822)
(4,412)

OshKos
K
h tradename impairment charge
(30,000)


Skip Hop
o tradename impairment charge


(9,000)
Consolidated operating income
$
254,728
$
323,405
$
379,171
Interest expense
31,331
33,973
42,781
Interest income
(11,039)
(4,776)
(1,261)
Other expense (income), net
3,627
(8,034)
975
Loss on extinguishment of debt


19,940
Income before income taxes
$
230,809
$
302,242
$
316,736
(1)
Unallocated corporate expenses include corporate overhead expenses that are not directly attributable to one of our reportabl
a e segments and include
unallocated accounting, finance, legal, human resources, and information technology expenses, occupa
u
ncy costs for our corporate headquarters, and other
benefit and compensation programs, including performance-based compensation.
(2)
Related to charges for corporate organizational restructur
t
ing in the fiscal year ended December 28, 2024 and organizational restructur
t
ing and related
corporate offi
f ce lease amendment actions in the fiscal year ended December 30, 2023.
Additional Data by Segment
The tabl
a es below present additional information for our reportabl
a e segments for the periods presented:
Depr
e
eciatio
t n and amortizatio
t n expe
x
nse
Fiscal year ended
December 28, 2024
December 30, 2023
December 31, 2022
U.S. Wholesale
$
8,749
$
10,958
$
13,415
U.S. Retail
35,562
38,710
39,975
International
11,413
11,758
11,695
Unallocated corporate
2,202
2,713
191
Total
57,926
64,139
65,276
Inventory
December 28, 2024
December 30, 2023
Inventory:
y
U.S. Wholesale(*)
$
374,610
$
381,146
U.S. Retail
59,868
73,366
International
67,854
82,613
Total inventory
$
r
502,332
$
537,125
All other assets
1,930,835
1,841,488
Total assets
$
2,433,167
$
2,378,613
(*)
U.S. Wholesale inventories also include inventory
r produced and warehoused for the U.S. Retail segment.
CARTER
S, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
91
Form 10-K

Net Sales
The tabl
a e below represents consolidated net sales by product:
Fiscal year ended
(dol
d lars in thousands)s
December 28, 2024
December 30, 2023
December 31, 2022
Baby
a
$
1,139,129
$
1,098,304
$
1,103,023
Playclothes
948,602
992,726
1,125,352
Sleepwear
373,373
411,678
492,152
Other(*)
382,998
442,886
492,206
Total net sales
$
2,844,102
$
2,945,594
$
3,212,733
(*)
Other product offe
f rings include bedding, outerwear, swimwear, shoes, socks, diaper bags, gift sets, toys, and hair accessories.
Geographical Data
Revenue
The Company
s international sales principally represent sales to customers in Canada. Such sales were 61.3%, 61.5%, and
64.0% of total international net sales in fiscal 2024, 2023, and 2022, respectively.
Long-Lived Assets
The following represents Property, plant, and equipment, net, and Operating lease assets by geographic area:
(dol
d lars in thousands)s
December 28, 2024
December 30, 2023
United States
$
614,751
$
582,049
International
143,338
129,469
Total
$
758,089
$
711,518
Long-lived assets in the international segment primarily relate to Canada. Long-lived assets in Canada were 53.8% and 51.0%
of total international long-lived assets as of December 28, 2024 and December 30, 2023, respectively.
Majo
a r Custom
t
ersr
Our two largest U.S. wholesale customers accounted for 10.9% and 10.1%, respectively, of consolidated net sales in fiscal
2024. Our largest U.S. wholesale customer accounted for 10.4% of consolidated net sales in fiscal 2023. Sales to these
customers did not exceed 10% in fiscal 2022.
NOTE 19  COMMITMENTS AND CONTINGENCIES
The Company is subj
u ect to various claims and pending or threatened lawsuits in the normal course of business. The Company is
not currently a party to any legal proceedings that it believes would have a material adverse effe
f ct on its financial position,
results of operations, or cash flows.
The Company
s contractua
t
l obligations and commitments include obligations associated with leases, the secured revolving
credit agreement, senior notes, and employee benefit plans.
CARTER
S, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
92

ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL
DISCLOSURE
Not applicable.
ITEM 9A. CONTROLS AND PROCEDURES
Evaluation of Disclosure Controls and Procedures
Our principal executive offi
f cer and principal financial offi
f cer has evaluated the effe
f ctiveness of the design and operation of our
disclosure controls and procedur
d
es (as defined under Rules 13a-15(e) and 15d-15(e) promulgated under the Securities Exchange
Act of 1934, as amended (the Exchange Act) as of the end of the period covered by this report. Based upon that evaluation,
our principal executive offi
f cer and principal financial offi
f cer has concluded that our disclosure controls and procedur
d
es are
effe
f ctive as of December 28, 2024.
Management
s Report on Internal Control over Financial Reporting
Our management is responsible for establ
a ishing and maintaining adequate internal control over financial reporting, as such term
is defined in Exchange Act Rule 13a-15(f). Our internal control over financial reporting is a process designed by, or under the
supe
u
rvision of,f the person serving as our principal executive offi
f cer and principal financial offi
f cer, to provide reasonabl
a e
assurance regarding the reliability of financial reporting and the preparation of financial statements for external purpos
r
es in
accordance with generally accepted accounting principles. Internal control over financial reporting includes those policies and
procedur
d
es that:

pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and
dispositions of the assets of the Company;

provide reasonabl
a e assurance that transactions are recorded as necessary to permit preparation of financial statements
in accordance with generally accepted accounting principles, and that receipts and expenditures of the Company are
being made only in accordance with authorizations of management and directors of the Company; and

provide reasonabl
a e assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition
of the Company
s assets that could have a material effe
f ct on the financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also,
projections of any evaluation of effe
f ctiveness to future periods are subj
u ect to the risk that controls may become inadequate
because of changes in conditions, or that the degree of compliance with the policies or procedur
d
es may deteriorate.
Management, including the person serving as our principal executive offi
f cer and principal financial offi
f cer, assessed the
effe
f ctiveness of the Company
s internal control over financial reporting as of December 28, 2024. In making this assessment,
management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (COSO)
in the 2013 Internal Contro
t
l-Integr
e
ated Framework
r . Based on this assessment, management has concluded that the Company
s
internal control over financial reporting was effe
f ctive as of December 28, 2024.
The effe
f ctiveness of Carter
s, Inc. and its subs
u
idiaries
 internal control over financial reporting as of December 28, 2024 has
been audited by PricewaterhouseCoopers LLP, the independent registered public accounting firm that audited the financial
statements included in this Annual Report on Form 10-K. PricewaterhouseCoopers LLP has issued an attestation report on
Carter
s, Inc.
s internal control over financial reporting containing the required disclosures, which appears herein.
Changes in Internal Control over Financial Reporting
There were no changes in the Company
s internal control over financial reporting during the fourth quarter of fiscal 2024 that
have materially affe
f cted, or are reasonabl
a y likely to materially affe
f ct, the Company
s internal control over financial reporting.
ITEM 9B. OTHER INFORMATION
Securities Trading Plans of Directors and Executive Offi
f cers
During the fiscal quarter ended December 28, 2024, none of the Company
s directors or offi
f cers, as defined in Section 16 of the
Exchange Act, adopted, modified, or terminated any contract, instruction or written plan for the purchase or sale of Company
securities that was intended to satisfy the affi
f rmative defense conditions of Rule 10b5-1(c) or any non-Rule 10b5-1 trading
arrangement as defined under Item 408(a) of Regulation S-K.
93
Form 10-K

Retirement Agreement with Former Chairman, Chief Executive Offi
f cer & President
In its Current Report on Form 8-K filed with the SEC on January 7, 2025, the Company announced that Michael D. Casey had
provided notice to the Board of Directors (the Board) of the Company of his decision to retire from his position as Chief
Executive Offi
f cer & President of the Company and as Chairman of the Board, effe
f ctive immediately, and that Mr. Casey would
be serving in an advisory capa
a
city through Februa
r
ry 28, 2025 to suppor
u
t the transition (the Transition Period). During the
Transition Period, Mr. Casey will continue to receive his salary and benefits he had immediately prior to his notice to the
Board, and will remain eligible to receive a bonus pursuant to the Company
s Amended and Restated Annual Incentive
Compensation Plan with respect to the services provided in 2024, but will not be eligible for a bonus payment in relation to
2025.
In connection with the pending completion of the Transition Period, the Company and Mr. Casey have entered into a
Retirement Agreement and Release dated Februa
r
ry 20, 2025 (the Retirement Agreement). Subj
u ect to the terms and conditions
of the Retirement Agreement, Mr. Casey will be entitled to accelerated vesting of his outstanding unvested restricted stock
awards and pro-rated vesting of his performance share awards issued in 2023 and 2024 (subject to the attainment of the
performance metrics under those awards). The foregoing description of the Retirement Agreement is not complete and is
subj
u ect to and qualifie
f d in its entirety by the complete text of the Retirement Agreement, which is filed herewith as an Exhibit.
ITEM 9C. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS
Not applicable.
94

PART III
ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORAT
R
E GOVERNANCE
The information called for by Item 10 is incorporated herein by reference from the sections titled DELINQUENT SECTION
16 REPORTS and AUDIT COMMITTEE REPORT

 in the definitive proxy statement relating to the Annual Meeting of
Shareholders of Carter
s, Inc. expected to be held on May 14, 2025. We intend to file such definitive proxy statement with the
SEC pursuant to Regulation 14A within 120 days afte
f r the end of the fiscal year covered by this Annual Report on Form 10-K.
We have adopted an insider trading policy governing the purchase and sale of our securities by our directors, offi
f cers, and
employees, and by the Company. We believe this policy is reasonabl
a y designed to promote compliance with insider trading
laws, rules, and regulations and listing standards applicable to the Company. A copy of our insider trading policy is filed as
Exhibit 19.1 to this Form 10-K.
ITEM 11. EXECUTIVE COMPENSATION
The information called for by Item 11 is incorporated herein by reference from the sections titled COMPENSATION OF
DIRECTORS and COMPENSATION DISCUSSION AND ANALYSIS in the definitive proxy statement referenced above
in Item 10.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND
RELATED STOCKHOLDER MATTERS
Equity Compensation Plan Information
The following tabl
a e provides information about our equity compensation plan as of our most recent fiscal year end:
Plan Category
g
y
Number of securities
to be issued upon
exercise of
outstanding options,
warrants, and rights
Weighted-average
exercise price of
outstanding options,
warrants, and rights
Number of securities
remaining available
for future issuance
under equity
compensation plans
(excluding securities
refle
f cted in first
column)
Equity compensation plans approved by security holders(*)
389,026
$
96.47
1,805,675
Equity compensation plans not approved by security holders



Total
389,026
$
96.47
1,805,675
(*)
Represents stock options that are outstanding or that are availabl
a e for future issuance pursuant to the Carter
s, Inc. Amended and Restated Equity
Incentive Plan.
Additional information called for by Item 12 is incorporated herein by reference from the section titled SECURITIES
OWNE
W
RSHIP OF CERTAIN BENEFICIAL OWNE
W
RS, DIRECTORS, AND EXECUTIVE OFFICERS in the definitive
proxy statement referenced above in Item 10.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANS
R
ACTIONS, AND DIRECTOR INDEPENDENCE
The information called for by Item 14 is incorporated by reference from the sections titled DIRECTOR INDEPENDENCE
and TRANS
A
ACTIONS WITH RELATED PERSONS, PROMOTERS, AND CERTAIN CONTROL PERSONS in the
definitive proxy statement referenced above in Item 10.
ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES
The information called for by Item 14 is incorporated by reference from the section titled PROPOSAL NUMBER THREE:
RATIFICATION OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM in the definitive proxy statement
referenced above in Item 10.
95
Form 10-K

PART IV
ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
(A)
Page
g
1.
Financial Statements filed as part of this report
50
Report of Independent Registered Publ
u ic Accounting Firm
51
Consolidated Balance Sheets at December 28, 2024 and December 30, 2023
54
Consolidated Statements of Operations for the fiscal years ended December 28, 2024, December 30,
2023, and December 31, 2022
55
Consolidated Statements of Comprehensive Income for the fiscal years ended December 28, 2024,
December 30, 2023, and December 31, 2022
56
Consolidated Statements of Cash Flows for the fiscal years ended December 28, 2024, December 30,
2023, and December 31, 2022
57
Consolidated Statements of Changes in Shareholders' Equity for the fiscal years ended December 28,
2024, December 30, 2023, and December 31, 2022
58
Notes to Consolidated Financial Statements
59
2.
Financial Statement Schedules: None
(B)
Exhibits:
Incorporated by Reference
Exhibit
Number
Exhibit Description
Form
Exhibit
Number
Filing Date
Filed Herewith
3.1
Amended and Restated Certific
f ate of Incorporation
of Carter
s, Inc.
8-K
3.1
May 23, 2017
3.2
Amended and Restated By-Laws of Carter
s, Inc.
8-K
3.1
August 18, 2023
4.1
Specimen Certific
f ate of Common Stock
S-1/A
4.1
October 10, 2003
4.2
Indentur
t
e, dated March 14, 2019, by and among
The William Carter Company, certain guarantors
from time to time party thereto and Wells Fargo
Bank, National Association, as Trus
r
tee
8-K
4.1
March 14, 2019
4.2.1
Form of 5.625% Senior Notes due 2027 (included
in Exhibit 4.2).
8-K
4.1
March 14, 2019
4.3
Description of Securities
10-K
4.3
Februa
r
ry 24, 2020
96

Incorporated by Reference
Exhibit
Number
Exhibit Description
Form
Exhibit
Number
Filing Date
Filed Herewith
10.1
Fourth Amended and Restated Credit Agreement,
dated as of August 25, 2017, by and among The
William Carter Company, as U.S. Borrower, The
Genuine Canadian Corp., as Canadian Borrower,
Carter
s Holdings B.V., as Dutch Borrower,
JPMorgan Chase Bank, N.A., as Administrative
Agent, U.S. Dollar Facility Swing Line Lender,
U.S. Dollar Facility L/C Issuer and Collateral
Agent, JPMorgan Chase Bank, N.A., Toronto
Branch, as Canadian Agent, a Multicurrency
Facility Swing Line Lender and a Multicurrency
Facility L/C Issuer, J.P. Morgan Europe Limited, as
European Agent, JPMorgan Chase Bank, N.A.,
London Branch, as a Multicurrency Facility Swing
Line Lender and a Multicurrency Facility L/C
Issuer, Bank of America, N.A. and Bank of
Montreal, as Co-Syndication Agents, JPMorgan
Chase Bank, N.A., Merrill Lynch, Pierce, Fenner &
Smith Incorporated and BMO Capi
a tal Markets
Corp., as Joint Lead Arrangers and Bookrunne
r
rs,
Branch Banking & Trus
r
t Company, HSBC
Securities (USA) Inc., Royal Bank of Canada,
SunTrust Bank, U.S. Bank National Association
and Wells Fargo Bank, National Association, as
Co-Documentation Agents and certain other lenders
party thereto
8-K
10.1
August 31, 2017
10.1.1
Amendment No. 1, dated as of September 21, 2018,
to the Fourth Amended and Restated Credit
Agreement dated as of August 25, 2017, by and
among The William Carter Company, as U.S.
Borrower, The Genuine Canadian Corp., as
Canadian Borrower, Carter
s Holdings B.V., as
Dutch Borrower, JPMorgan Chase Bank, N.A., as
Administrative Agent, Collateral Agent, U.S.
Dollar Facility Swing Line Lender and U.S. Dollar
Facility L/C Issuer, JPMorgan Chase Bank, N.A.,
Toronto Branch, as Canadian Agent, a
Multicurrency Facility Swing Line Lender and a
Multicurrency Facility L/C Issuer, J.P. Morgan
Europe Limited, as European Agent, JPMorgan
Chase Bank, N.A., London Branch, as a
Multicurrency Facility Swing Line Lender and a
Multicurrency Facility L/C Issuer, each lender from
time to time party thereto and the other parties party
thereto
8-K
10.1
September 26, 2018
10.1.2
Amendment No. 2, dated as of May 4, 2020, to the
Fourth Amended and Restated Credit Agreement
dated as of August 25, 2017, by and among The
William Carter Company, as U.S. Borrower, The
Genuine Canadian Corp., as Canadian Borrower,
Carter's Holdings B.V., as Dutch Borrower,
JPMorgan Chase Bank, N.A., as Administrative
Agent, Collateral Agent, U.S. Dollar Facility
Swing Line Lender and U.S. Dollar Facility L/C
Issuer, JPMorgan Chase Bank, N.A., Toronto
Branch, as Canadian Agent, a Multicurrency
Facility Swing Line Lender and a Multicurrency
Facility L/C Issuer, J.P. Morgan Europe Limited, as
European Agent, JPMorgan Chase Bank, N.A.,
London Branch, as a Multicurrency Facility Swing
Line Lender and a Multicurrency Facility L/C
Issuer, each lender from time to time party thereto
and the other parties party thereto
10-Q
10.1
July 24, 2020
97
Form 10-K

Incorporated by Reference
Exhibit
Number
Exhibit Description
Form
Exhibit
Number
Filing Date
Filed Herewith
10.1.3
Amendment No. 3, dated as of April 21, 2021, to
the Fourth Amended and Restated Credit
Agreement dated as of August 25, 2017, by and
among The William Carter Company, as U.S.
Borrower, The Genuine Canadian Corp., as
Canadian Borrower, Carter's Holdings B.V., as
Dutch Borrower, JPMorgan Chase Bank, N.A., as
Administrative Agent, Collateral Agent, U.S.
Dollar Facility Swing Line Lender and U.S. Dollar
Facility L/C Issuer, JPMorgan Chase Bank, N.A.,
Toronto Branch, as Canadian Agent, a
Multicurrency Facility Swing Line Lender and a
Multicurrency Facility L/C Issuer, JPMorgan Chase
Bank, N.A., as European Agent, JPMorgan Chase
Bank, N.A., London Branch, as a Multicurrency
Facility Swing Line Lender and a Multicurrency
Facility L/C Issuer, each lender from time to time
party thereto and the other parties party thereto
8-K
10.1
April 26, 2021
10.1.4
Amendment No. 4 to Fourth Amended and
Restated Credit Agreement and Second
Amendment to Amended and Restated Security
Agreement, dated as of April 11, 2022 (this
Amendment No. 4), relating to (i) the Fourth
Amended and Restated Credit Agreement dated as
of August 25, 2017, among The William Carter
Company, a Massachusetts corporation (the U.S.
Borrower), The Genuine Canadian Corp., an
Ontario corporation (the Canadian Borrower),
Carter
s Holdings B.V., having its offi
f cial seat
(statutaire zetel) in Amsterdam, the Netherlands,
registered with the Dutch trade register under
number 63530201 (Dutch Borrower and, together
with the U.S. Borrower and the Canadian
Borrower, the Borrowers), each lender from time
to time party thereto (collectively, the Lenders
and individually, a Lender), JPMorgan Chase
Bank, N.A., as Administrative Agent (in such
capa
a
city, the Administrative Agent), Collateral
Agent (in such capacity, the Collateral Agent),
U.S. Dollar Facility Swing Line Lender and U.S.
Dollar Facility L/C Issuer, JPMorgan Chase Bank,
N.A., Toronto Branch, as Canadian Agent, a
Multicurrency Facility Swing Line Lender and a
Multicurrency Facility L/C Issuer, J.P. Morgan SE,
as European Agent, JPMorgan Chase Bank, N.A.,
London Branch, as a Multicurrency Facility Swing
Line Lender and a Multicurrency Facility L/C
Issuer and the other parties party thereto
8-K
10.1
April 14, 2022
98

Incorporated by Reference
Exhibit
Number
Exhibit Description
Form
Exhibit
Number
Filing Date
Filed Herewith
10.1.5
Amendment No. 5 to Fourth Amended and
Restated Credit Agreement, dated as of June 24,
2024 (this Amendment No. 5), relating to the
Fourth Amended and Restated Credit Agreement
dated as of August 25, 2017, among The William
Carter Company, a Massachusetts corporation
(the U.S. Borrower), The Genuine Canadian
Corp., an Ontario corporation (the Canadian
Borrower and, together with the U.S. Borrower,
the Borrowers), each lender from time to time
party thereto (collectively, the Lenders and
individually, a Lender), JPMorgan Chase Bank,
N.A., as Administrative Agent (in such capa
a
city,
the Administrative Agent), Collateral Agent,
U.S. Dollar Facility Swing Line Lender and U.S.
Dollar Facility L/C Issuer, JPMorgan Chase
Bank, N.A., Toronto Branch, as Canadian Agent
(in such capa
a
city, the Canadian Agent), a
Multicurrency Facility Swing Line Lender and a
Multicurrency Facility L/C Issuer, J.P. Morgan
SE, as European Agent, JPMorgan Chase Bank,
N.A., London Branch, as a Multicurrency Facility
Swing Line Lender and a Multicurrency Facility
L/C Issuer and the other parties party thereto
10-Q
10.1
July 26, 2014
10.2 *
Form of Severance Agreement entered into from
time to time between The William Carter
Company and executive offi
f cers
10-Q
10.2
October 29, 2015
10.3 *
Amended and Restated Equity Incentive Plan
(Effective May 17, 2018)
DEF
14A
Appendix
B
April 4, 2018
10.4 *
Amended and Restated Equity Incentive Plan
(Effective Februa
r
ry 15, 2024)
8-K
10.1
Februa
r
ry 16, 2024
10.5 *
Amended and Restated Annual Incentive
Compensation Plan
DEF
14A
Appendix
C
March 31, 2016
10.6 *
The William Carter Company Severance Plan,
amended and restated effe
f ctive January 1, 2020
10-K
10.5
Februa
r
ry 24, 2020
10.7 *
The William Carter Company Deferred
Compensation Plan, dated as of November 10,
2010
10-K
10.20
March 2, 2011
10.8 *
Form of Restricted Stock Award Agreement
(Time Vesting) (2023 Awards)
10-Q
10.1
April 28, 2023
10.9 *
Form of Performance-Based Restricted Stock
Agreement (2023 Awards)
10-Q
10.2
April 28, 2023
10.10 *
Consulting Agreement, effe
f ctive March 1, 2024,
between The William Carter Company and Brian
J. Lynch
10-K
10.10
Februa
r
ry 27, 2024
10.11 *
Form of Restricted Stock Award Agreement
(2024 Awards)
10-Q
10.1
April 26, 2024
10.12 *
Form of rTSR Performance-Based Restricted
Stock Award Agreement (2024 Awards)
10-Q
10.2
April 26, 2024
10.13 *
Form of Company Performance-Based Restricted
Stock Award Agreement (2024 Awards)
10-Q
10.3
April 26, 2024
99
Form 10-K

Incorporated by Reference
Exhibit
Number
Exhibit Description
Form
Exhibit
Number
Filing Date
Filed Herewith
10.14
Lease Agreement dated March 29, 2012, between
The William Carter Company and Duke Secured
Financing 2009-1 ALZ, LLC (Braselton
Distribution Center)
10-Q
10.21
April 27, 2012
10.15
First Amendment to Lease Agreement dated
December 4, 2013, between The William Carter
Company and Duke Secured Financing 2009-1
ALZ, LLC (Braselton Distribution Center)
10-K
10.12
Februa
r
ry 27, 2024
10.16
Second Amendment to Lease Agreement dated
December 17, 2014, between The William Carter
Company and Duke Secured Financing 2009-1
ALZ, LLC (Braselton Distribution Center)
10-K
10.13
Februa
r
ry 27, 2024
10.17
Lease Agreement dated December 14, 2012,
between The William Carter Company and
Phipps Tower Associates, LLC
8-K
10.1
December 14, 2012
10.18
First Amendment to Lease Agreement dated
Februa
r
ry 28, 2013, between The William Carter
Company and Phipps Tower Associates, LLC
10-K
10.15
Februa
r
ry 27, 2024
10.19
Second Amendment to Lease Agreement dated
June 17, 2013, between The William Carter
Company and Phipps Tower Associates, LLC
10-Q
10.19
October 24, 2013
10.20
Third Amendment to Lease Agreement dated
August 31, 2016, between The William Carter
Company and John Hancock Life Insurance
Company (U.S.A.)
10-K
10.17
Februa
r
ry 27, 2024
10.21
Fourth Amendment to Lease Agreement dated
December 1, 2021, between The William Carter
Company and Hancock S-REIT ATL Phipps LLC
10-K
10.18
Februa
r
ry 27, 2024
10.22
Fifth Amendment to Lease Agreement dated
Februa
r
ry 9, 2023, between The William Carter
Company and Hancock S-REIT ATL Phipps LLC
10-K
10.19
Februa
r
ry 27, 2024
10.23 *
Retirement Agreement and Release dated
Februa
r
ry 20, 2025, between The William Carter
Company and Michael D. Casey
x
19.1 ***
Carter
s, Inc. Insider Trading Policy
x
21
Subs
u
idiaries of Carter
s, Inc.
x
23
Consent of Independent Registered Publ
u ic
Accounting Firm.
x
31.1
Rule 13a-15(e)/15d-15(e) and 13a-15(f)/15d-15(f)
Certific
f ation.
x
32 * *
Section 1350 Certific
f ation.
x
97.1
Carter
s, Inc. Clawback Policy Adopted on
August 4, 2023
10-K
97.1
Februa
r
ry 27, 2024
100

Incorporated by Reference
Exhibit
Number
Exhibit Description
Form
Exhibit
Number
Filing Date
Filed Herewith
101.INS
XBRL Instance Document - the instant document
does not appear in the Interactive Data File
because its XBRL tags are embedded within the
Inline XBRL document
x
101.SCH
XBRL Taxonomy Extension Schema Document
x
101.CAL
XBRL Taxonomy Extension Calculation
Linkbase Document
x
101.DEF
XBRL Taxonomy Extension Definition Linkbase
Document
x
101.LAB
XBRL Taxonomy Extension Labe
a
l Linkbase
Document
x
101.PRE
XBRL Taxonomy Extension Presentation
Linkbase Document
x
104
The cover page from this Current Report on Form
10-K formatted as Inline XBRL
x
*
Indicates a management contract or compensatory plan.
** Furnished herewith as an Exhibit.
*** Certain portions of this exhibit are confid
f ential and have been omitted pursuant to Item 601(b)(10) of Regulation S-K. The
Company agrees to suppl
u
ementally furnish to the Securities and Exchange Commission a copy of such omissions upon request.
ITEM 16. FORM 10-K SUMMARY
Omitted at registrant
s option.
101
Form 10-K

SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this
report to be signed on its behalf by the undersigned, thereunto duly authorized.
CARTER
S, INC.
/s/ RICHARD F. WESTENBERGER
Richard F. Westenberger
Interim Chief Executive Offi
f cer,
Senior Executive Vice President,
Chief Financial Offi
f cer & Chief Operating Offi
f cer
Date: Februa
r
ry 25, 2025
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following
persons on behalf of the Registrant and in the capacities and on the dates indicated.
Name
Title
Date
/s/ RICHARD F. WESTENBERGER
Interim Chief Executive Offi
f cer,
Senior Executive Vice President,
Chief Financial Offi
f cer & Chief Operating Offi
f cer
February
r 25, 2025
Richard F. Westenberger
(Principal Executive Offi
f cer &
Principal Financial & Accounting Offi
f cer)
/s/ WILLIAM J. MONTGORIS
Non-Executive Chairman and Director
Februa
r
ry 25, 2025
William J. Montgoris
/s/ ROCHESTER (ROCK) ANDERSON, JR. Director
February
r 25, 2025
Rochester (Rock) Anderson, Jr.
/s/ JEFFREY H. BLACK
Director
February
r 25, 2025
Jeffrey H. Black
/s/ HALI BORENSTEIN
Director
Februa
r
ry 25, 2025
Hali Borenstein
/s/ LUIS A. BORGEN
Director
Februa
r
ry 25, 2025
Luis A. Borgen
102

/s/ JEVIN S. EAGLE
Director
February
r 25, 2025
Jevin S. Eagle
/s/ MARK P. HIPP
Director
Februa
r
ry 25, 2025
Mark P. Hipp
/s/ STACEY S. RAUCH
Director
February
r 25, 2025
Stacey S. Rauch
/s/ GRETCHEN W. SCHAR
Director
Februa
r
ry 25, 2025
Gretchen W. Schar
/s/ STEPHANIE P. STAHL
Director
Februa
r
ry 25, 2025
Stephanie P. Stahl
103
Form 10-K




 	     
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