CAL 10-K & 10-Q changes, risk factors and insider trading

During the three months ended MayAugust 2,1, 2026, there have been no material changes from the risk factors previously disclosed under Part I, Item 1A, “Risk Factors” in the 2025 Form 10-K.

We are a global footwear company that operates retail stores and e-commerce websites, and designs, develops, sources, manufactures and distributes footwear for people of all ages. Our mission is to inspire people to feel great...feet first. We offer retailers and consumers a diversified portfolio of leading footwear brands. Outfitted in our brands, customers can step confidently into every aspect of their lives. As both a retailer and a wholesaler, we have a perspective on the marketplace that enables us to serve consumers from different vantage points. We believe our diversified business model provides us with synergies by spanning consumer segments, categories and distribution channels. A combination of thoughtful planning and rigorous execution is key to our success in optimizing our business and portfolio of brands. Our business strategy is focused on accelerating growth in our Brand Portfolio segment, gaining market share and deepening connections with the millennial family in our Famous Footwear segment, leveraging our “One Caleres” capabilities to increase profitability, and delivering value for our shareholders.

Macroeconomic conditions continued to weigh on consumer discretionary spending and our financial results during the firstsecond quarter of 2026. Consumers remain impacted by elevated interest rates, persistent inflation, and expectations of future price increases, which have increased pressure on discretionary spending. In addition, heightened geopolitical volatility has adversely affected the global economy. More recently, conflict throughout the Middle East, particularly the war in Iran, has increased oil prices, resulting in higher product and transportation costs. As a result, we continued to experience lower consumer traffic in our Famous Footwear retail stores during the quarter.

Tariff volatility and the lack of clarity surrounding future trade policy developments have heightened uncertainty in the global economy. We source a majority of our products internationally. We continue to monitor changes in policy impacting global trade, including tariffs, which have been volatile and subject to ongoing modification. In February 2026, the U.S. Supreme Court invalidated certain tariffs imposed under the International Emergency Economic Powers Act (“IEEPA”) and in March 2026, the U.S. Court of International Trade ordered the U.S. Customs and Border Protection Agency (“CBP”) to suspend collection of the invalidated tariffs and to establish a process to refund IEEPA tariffs previously collected. WhileDuring the timingthirteen remainsand uncertain,twenty-six weweeks currentlyended estimateAugust that we are eligible to receive approximately $57.9 million in refunds related to the invalidated tariffs. Beginning in April1, 2026, we begancollected filing$57.4 refundmillion claimsof withtariff CBPrefunds and related tointerest. eligible tariff payments made. There can be no guarantee that a refund will equal the full amount of IEEPA tariffs paid, and any refund may be subject to further legal and regulatory developments that could delay, reduce, or eliminate any refund. As a result of this uncertainty, as of May 2, 2026, we have not recorded a receivable related to the potential recovery of IEEPA tariffs paid. Beginning on May 11, 2026, theThe Company has received cashsubstantially all of $16.8the milliontariff for a portion of its refunds claims, with applicable interest.refunds.

Additionally, following the Supreme Court’s ruling invalidating the IEEPA tariffs, the U.S. imposed a temporary 10% general tariff under Section 122 of the Trade Act of 1974 and initiated additional trade actions, including investigationsthe imposition of tariffs under Sections 301of the Trade Act of 1974, as well as other statutory authorities that may be used to impose tariffs or other import restrictions. On July 24, 2026, new tariff rates were imposed under Section 301 of the Trade Act of 1974,1974. In addition, the U.S. Trade Representative has indicated that additional Section 301 tariffs may resultbe implemented in furtherthe tariffs..coming months following investigations covering a broad range of countries, including major sourcing markets. There remains substantial uncertainty regarding the potential changes or pauses to existing and newly announced tariffs, tariff levels, and whether additional tariffs or other reciprocal actions may be imposed, modified, or suspended. We have continued to implement various mitigation strategies including adjusting the countries from which we source our products and negotiating price concessions with our factories and selectively raising prices. Proposed or enacted tariffs and changes to U.S. trade policies may be reinstituted, paused, removed, or changed at any time, and to the extent we are unable to successfully mitigate any negative resulting impacts, it could adversely affect our business, financial condition, and results of operation.

Our liquidity position remains strong, with $37.7$50.9 million in cash and cash equivalents and excess availability on our revolving credit agreement of $191.5$357.3 million as of MayAugust 2,1, 2026. During the firstsecond quarter of 2026, borrowings on our revolving credit agreement increaseddecreased to $347.5$288.0 million, primarily driven by borrowingsrepayments tounder fundour therevolving acquisitioncredit ofagreement Stuartresulting Weitzmanfrom incash thereceipts thirdfrom quartertariff of 2025. Refer to Note 3 to the condensed consolidated financial statements for further discussion of the acquisition.refunds.

Highlights of our consolidated and segment results for the firstsecond quarter of 2026 and 2025 are as follows:

Net sales increased $52.4$37.0 million, or 8.5%,5.6%, to $666.6$695.5 million for the firstsecond quarter of 2026, compared to $614.2$658.5 million for the firstsecond quarter of 2025. Net sales of our Brand Portfolio segment increased $60.9$65.0 million, or 20.6%, reflecting the impact of our23.6%. Stuart WeitzmanWeitzman, acquisitionacquired on August 4, 2025, which contributed net sales of $43.9$42.5 million,million. andBrand Portfolio net sales were up 8.2% on an organic growth basis, reflecting increases in our owned e-commercewholesale and wholesaleinternational businesses. We saw broad strength in premiumour fashion footwear brands and growth in most of our more value-oriented brands. Net sales in our Famous Footwear segment decreased $8.4$25.2 million, or 2.5%,6.3%, and comparable sales declined 2.3%,5.9%, reflecting less traffic in our retail stores. Our direct-to-consumer sales represented approximately 67%71% of consolidated net sales for the firstsecond quarter of 2026, compared to 70%75% for the firstsecond quarter of 2025. We remain focused on international growth, direct-to-consumer penetration, elevating the consumer experience at Famous Footwear and maximizing the vertical opportunity between the Famous Footwear and Brand Portfolio segments, with Dr. Scholl’s, LifeStride, Naturalizer, and Blowfish Malibu, and RykaMalibu representing fivefour of Famous Footwear’s top 20 best-selling footwear brands during the quarter.

Gross profit increased $36.8$95.2 million, or 13.2%,33.3%, to $315.5$381.0 million for the firstsecond quarter of 2026, compared to $278.7$285.8 million for the firstsecond quarter of 2025. As a percentage of net sales, gross profit increased to 47.3%54.8% for the firstsecond quarter of 2026, compared to 45.4%43.4% for the firstsecond quarter of 2025,2025. The increase primarily reflectingreflects $55.6 million of tariff refunds received in the second quarter of 2026. The remaining increase is driven by lower ongoing tariffs,tariffs and the continuation of our tariff mitigation efforts,efforts loweras markdowns,well andas favorable productchannel mix.mix with more retail sales, which have a higher margin than wholesale, as a result of the Stuart Weitzman acquisition. This was offset by clearance-related activity.

Selling and administrative expenses increased $27.2$33.7 million, or 10.2%,12.5%, to $293.7$303.4 million for the firstsecond quarter of 2026, compared to $266.5$269.7 million for the firstsecond quarter of 2025. The increase was driven by expenses associated with our acquired Stuart Weitzman brand, as well as higher expenses associated with our incentive compensation programs. As a percentage of net sales, selling and administrative expenses increased to 44.1%43.6% for the firstsecond quarter of 2026, from 43.4%40.9% for the firstsecond quarter of 2025.

Restructuring and other special charges, net resulted in income of $2.1 million for the firstsix quartermonths ofended August 1, 2026, driven by a gain on the sale of one of the remaining parcels comprising the corporate headquarters and offset by Stuart Weitzman acquisition and integration costs. Refer to Note 6 to the condensed consolidated financial statements for additional information related to these charges. We incurred restructuring costs of $0.6$7.4 million for the firstsix quartermonths ofended August 2, 2025, primarily for legal and other related costs associated with the acquisition of Stuart Weitzman.Weitzman and other related costs associated with our expense reduction initiatives.

Operating earnings increased $12.3$68.3 million to $23.9$77.6 million for the firstsecond quarter of 2026, compared to $11.6$9.3 million for the firstsecond quarter of 2025, reflecting the factors described above. As a percentage of net sales, operating earnings were 3.6%11.2% for the firstsecond quarter of 2026, compared to 1.9%1.4% for the firstsecond quarter of 2025.

Interest expense, net increaseddecreased $0.9$0.1 million, or 23.7%,2.5%, to $4.7$4.4 million for the firstsecond quarter of 2026, compared to $3.8$4.5 million for the firstsecond quarter of 2025, reflecting higherlower average borrowings on our revolving credit facility. As discussed above, we used the revolving credit facility to fund the acquisition of Stuart Weitzman that closed on August 4, 2025.

Other income, net increased $0.5$3.5 million to $1.2$4.5 million for the firstsecond quarter of 2026, compared to $0.7$1.0 million for the firstsecond quarter of 2025, and increased $4.0 million, to $5.7 million for the six months ended August 1, 2026, compared to $1.7 million for the six months ended August 2, 2025, primarily reflecting $1.8 million of interest received from tariff refunds, as well as higher income generated from our pension plan assets in the firstsecond quarter ofand six months ended August 1, 2026. Refer to Note 14 of the condensed consolidated financial statements for further information.

Our effective tax rate can vary considerably from period to period, depending on a number of factors. Our consolidated effective tax rates were 32.4%a provision of 23.6% and 29.8%a benefit of 22.0% for the thirteensecond weeksquarter ended May 2,of 2026 and May2025, 3,respectively. Our consolidated effective tax rates were provisions of 25.4% and 8.8% for the six months ended August 1, 2026 and August 2, 2025, respectively. The higher effective tax rate for the quarter was driven by the pre-tax income and tax provision associated with tariff refunds received during the second quarter of 2026 contrasted with a discrete tax benefit of $2.5 million associated with foreign earnings transition tax resolution during the second quarter of 2025. Discrete tax provisions related to share-based compensation of $1.2$1.5 million and $0.3$0.4 million were also recorded for the thirteensix weeksmonths ended MayAugust 2,1, 2026 and MayAugust 3,2, 2025, respectively.

In 2021, the Organization for Economic Cooperation and Development (OECD) released Pillar Two Global Anti-Base Erosion model rules, designed to ensure large corporations are taxed at a minimum rate of 15% in all countries of operation. The OECD continues to release guidance and countries are implementing legislation to adopt the rules, which became effective on January 1, 2024. In January 2026, the OECD announced that the U.S. multinational regime would be considered a side-by-side regime that should prevent U.S. companies from double taxation.taxation, although the arrangement is still being reviewed and adopted by other countries who have enacted Pillar Two legislation. We are continuing to evaluate the Pillar Two rules and their potential impact on future periods, but we do not expect the rules to have a material impact on our tax provision or effective tax rate.

Net earnings attributable to Caleres, Inc. werewas $14.3$58.6 million and $72.9 million for the firstsecond quarter ofand 2026six months ended August 1, 2026, respectively, compared to $6.9$6.7 million and $13.7 million for the firstsecond quarter ofand six months ended August 2, 2025, respectively, as a result of the factors described above.

Net sales of $319.3$374.4 million in the firstsecond quarter of 2026 decreased $8.4$25.2 million, or 2.5%,6.3%, compared to the firstsecond quarter of 2025. Comparable sales decreased 2.3%5.9% for the firstsecond quarter of 2026 driven by a decline in consumer traffic in our retail stores. We experienced strong growth in e-commerceE-commerce sales andwere an increase in e-commerce penetration to 16%14% of net sales in both the firstsecond quarter of 2026,2026 from 14% in the first quarter ofand 2025. Our kids category, which is a key differentiator for Famous Footwear, continued to outperform the total chain.

We opened onesix storestores and closed 10four stores during the firstsecond quarter of 2026, resulting in 812814 stores and total square footage of 5.4 million at the end of the quarter, compared to 835830 stores and total square footage of 5.5 million at the end of the firstsecond quarter of 2025. Sales to members of our customer loyalty program, Famously You Rewards, continue to account for a majority of the segment’s sales with approximately 78%77% of our net sales made to program members in the firstsecond quarter of 2026, comparedconsistent to 79% inwith the firstsecond quarter of 2025.

Gross profit decreased $8.4$14.9 million, or 5.7%,8.5%, to $140.0$159.8 million for the firstsecond quarter of 2026, compared to $148.4$174.7 million for the firstsecond quarter of 2025. As a percentage of net sales, our gross profit decreased to 43.8%42.7% for the firstsecond quarter of 2026, from 45.3%43.7% for the firstsecond quarter of 2025, reflecting higher levels of clearance-related promotional activity and inventory valuation adjustments.activity.

Selling and administrative expenses decreased $3.0$1.4 million, or 2.1%,0.9%, to $140.4$154.6 million for the firstsecond quarter of 2026, compared to $143.4$156.0 million for the firstsecond quarter of 2025. The decrease was primarily driven by lower information technology costs and lower warehouse and distribution costs and timing of marketing spend.costs. During the firstsecond quarter of 2026, we converted two stores to the FLAIR concept, ending the quarter with a total of 5961 FLAIR stores. These stores continue to outperform our traditionally designed retail stores. As a percentage of net sales, selling and administrative expenses increased to 44.0%41.3% for the firstsecond quarter of 2026, compared to 43.8%39.1% for the firstsecond quarter of 2025.

OperatingSelling (loss)and earningsadministrative expenses decreased $5.4$4.4 millionmillion, or 1.5%, to operating loss of $0.4$295.1 million for the firstsix quartermonths ofended August 1, 2026, compared to operating earnings of $5.0$299.5 million for the firstsix quartermonths ofended 2025,August 2, 2025. The decrease was primarily reflectingdriven theby factorslower describedinformation above.technology spend and lower warehouse and distribution costs. As a percentage of net sales, operatingselling (loss)and earningsadministrative declinedexpenses increased to (0.1)%42.5% for the firstsix quartermonths ofended August 1, 2026, compared to 1.5%41.2% for the firstsix quartermonths ofended August 2, 2025.

Net sales of $356.3$340.6 million in the firstsecond quarter of 2026 increased $60.9$65.0 million, or 20.6%,23.6%, compared to the firstsecond quarter of 2025. The increase primarily reflects the acquisition of Stuart Weitzman on August 4, 2025,2025. whichStuart Weitzman contributed net sales of $43.9$42.5 million in the firstsecond quarter of 2026. WeThe experiencedremaining 8.2% increase in net sales was driven by strong growth in our company-owned e-commerce business, which increased approximately 21% during the first quarter of 2026, andorganic growth in our wholesale business.and international businesses. We saw broad strength in premiumour fashion footwear brands and declinesgrowth in our more value-oriented brands. Our direct-to-consumer sales represented approximately 36%37% of net sales for the firstsecond quarter of 2026, compared to 35%36% for the firstsecond quarter of 2026.2025. During the firstsecond quarter of 2026, weopened didtwo notstores openand orclosed close anyfour stores in North America, resulting in a total of 8583 stores, compared to 6163 stores in the firstsecond quarter of 2025. We remain focused on international growth and continue to evaluate expansion of our international presence during the firstsecond quarter of 2026. There were 9991 stores in East Asia at MayAugust 2,1, 2026, compared to 5455 stores at MayAugust 3,2, 2025. There were also 152151 international branded stores owned and operated by third parties through franchise agreements at MayAugust 2,1, 2026, compared to 116145 international branded stores at MayAugust 3,2, 2025.

Our unfilled order position for our wholesale sales increased $82.9$96.5 million, or 31.4%,39.5%, to $346.5$340.7 million at MayAugust 2,1, 2026, compared to $263.6$244.2 million at MayAugust 3,2, 2025.

Gross profit increased $45.2$111.7 million, or 35.0%,101%, to $174.5$222.8 million for the firstsecond quarter of 2026, compared to $129.3$111.1 million for the firstsecond quarter of 2025, driven by net sales growth.2025. As a percentage of net sales, our gross profit increased to 49.0%65.4% for the firstsecond quarter of 2026, compared to 43.8%40.3% for the firstsecond quarter of 2025. The increase was driven primarily by $55.6 million of tariff recoveries received in the current period. The remaining increase is driven by lower ongoing tariffs,tariffs and the continuation of our tariff mitigation efforts, loweras markdowns,well andas favorable productchannel mix.mix with more retail sales, which have a higher margin than wholesale, as a result of the Stuart Weitzman acquisition.

Selling and administrative expenses increased $23.1$28.9 million, or 20.6%,28.2%, to $135.0$131.5 million for the firstsecond quarter of 2026, compared to $111.9$102.6 million for the firstsecond quarter of 2025 driven by expenses related to our acquired Stuart Weitzman brand and growth in our international business. As a percentage of net sales, selling and administrative expenses wasincreased consistentto with the prior comparable period, 37.9%38.6% for the firstsecond quarter of 2026, compared to 37.9%37.2% for the firstsecond quarter of 2025.

There were no restructuring and other special charges during the second quarter of 2026. Restructuring and other special charges of $0.4 million for the thirteensix weeksmonths ended MayAugust 2,1, 2026 were primarily associated Stuart Weitzman acquisition and integration costs. Refer to Note 6 to the condensed consolidated financial statements for additional information related to these charges. There were no Restructuring and other special charges duringof $1.8 million for the thirteenthree weeksand six months ended MayAugust 3,2, 2025.2025 were associated with expense reduction initiatives, primarily severance.

Operating earnings increased to $39.1$91.2 million for the firstsecond quarter of 2026, from $17.4$6.7 million for the firstsecond quarter of 2025, as a result of the factors described above. As a percentage of net sales, operating earnings were 11.0%26.8% for the firstsecond quarter of 2026, compared to 5.9%2.4% for the firstsecond quarter of 2025.

The net sales elimination of $9.0$19.5 million for the firstsecond quarter of 2026 is $0.1$2.8 million, or 1.1%,16.8%, higher than the firstsecond quarter of 2025, reflecting a slightan increase in product sold from our Brand Portfolio segment to Famous Footwear compared to the prior comparable period. The net sales elimination of $28.5 million for the six months ended August 1, 2026 is $3.0 million, or 11.8%, higher than the six months ended August 2, 2025, reflecting an increase in product sold from our Brand Portfolio segment to Famous Footwear compared to the prior comparable period.

Selling and administrative expenses increased $7.2$6.1 million, to $18.3$17.2 million in the firstsecond quarter of 2026, compared to $11.1 million for the firstsecond quarter of 2025,2025. Selling and administrative expenses increased $15.9 million, to $38.1 million in the six months ended August 1, 2026, compared to $22.2 million in the six months ended August 2, 2025. The increase for both the quarter and six months primarily reflectingreflect higher expenses related to our incentive compensation programs and employee benefits costs.programs.

Restructuring and other special incomecharges, net consisted of $2.6 million of income for the firstsix quartermonths ofended 2026August was1, 2026, driven by a gain of $3.9 million for the sale of one of the remaining parcels comprising our corporate headquarters in Clayton, Missouri, partially offset by $1.3 million of technology, office relocation and other related costs associated with the acquisition of Stuart Weitzman. Restructuring and other special charges of $0.6$5.5 million for the firstsix quartermonths ofended August 2, 2025 were for legal and other related costs associated with the acquisition of Stuart Weitzman. Refer to Note 6 to the condensed consolidated financial statements for additional information related to these charges.information.

Total debt obligations of $347.5$288.0 million at MayAugust 2,1, 2026 increaseddecreased $89.0$99.5 million, from $258.5$387.5 million at MayAugust 3,2, 2025, and $51.0$8.5 million, from $296.5 million at January 31, 2026. On August 4, 2025, we completed the acquisition of Stuart Weitzman, as further discussed in Note 3 to the condensed consolidated financial statements. The increasedecrease in borrowings at MayAugust 2,1, 2026 primarily reflects repayments of borrowings at the end of the second quarter of 2025 to fund the acquisition, to fund business operations and inventory purchases.acquisition. Net interest expense for the firstsecond quarter of 2026 increaseddecreased $0.9$0.1 million to $4.7$4.4 million, compared to $3.8$4.5 million for the firstsecond quarter of 2025, reflecting higherlower average borrowings on our revolving credit facility.

At MayAugust 2,1, 2026, we had $347.5$288.0 million in borrowings and $8.5$7.6 million in letters of credit outstanding under the Credit Agreement. Total borrowing availability was $191.5$357.3 million at MayAugust 2,1, 2026. We were in compliance with all covenants and restrictions under the Credit Agreement as of MayAugust 2,1, 2026.

Cash usedprovided forby operating activities was $22.1$14.1 million higher in the thirteentwenty-six weeks ended MayAugust 2,1, 2026 as compared to the thirteentwenty-six weeks ended MayAugust 3,2, 2025, primarily reflecting the following factors, which includesincluding cash used for Stuart Weitzman operating activities:

Cash used for investing activities was $12.5$17.2 million lower for the thirteentwenty-six weeks ended MayAugust 2,1, 2026 as compared to the thirteentwenty-six weeks ended MayAugust 3,2, 2025, reflecting lower capital expenditures, due in part to less Famous Footwear remodel spending. We had 5961 FLAIR stores as of MayAugust 2,1, 2026 and expect to add twothree to five more FLAIR stores during the second quarterhalf of 2026. The lower capital expenditures are offset by a $4.0 million of cash received for the sale of one of the remaining parcels comprising the Company’s corporate headquarters.

Working capital at MayAugust 2,1, 2026 was $29.4$105.6 million, which was aan decreaseincrease of $46.7$21.3 million from MayAugust 3,2, 2025 and aan $12.2increase of $88.1 million increase from January 31, 2026. The decreaseincrease in working capital from MayAugust 3,2, 2025 to August 1, 2026 primarily reflects highera decrease in borrowings under our revolving credit agreement and higher accrued expenses, partially offset by higher inventory, higher receivables and lower trade accounts payable.agreement. The revolver was used to fund the acquisition of Stuart Weitzman, as further described in Note 3 to the condensed consolidated financial statements. The increase was further driven by increases in net receivables and net inventories. The increase in working capital from January 31, 2026 primarily reflects higher receivablesnet and prepaid and other current assets, partially offset by higher borrowings under our revolving credit agreement. Our current ratio was 1.03:1 as of May 2, 2026, compared to 1.10:1 at May 3, 2025 and 1.02:1 at January 31, 2026. Our debt-to-capital ratio was 35.9% as of May 2, 2026, compared to 29.7% as of May 3, 2025 and 32.7% at January 31, 2026. The higher debt-to-capital ratio as of May 2, 2026 reflects the increase in borrowings under our revolving credit agreement as a result of the Stuart Weitzman acquisition.inventories.

We declared and paid dividends of $0.07 per share in the firstsecond quarter of both 2026 and 2025. The declaration and payment of any future dividend is at the discretion of the Board of Directors and will depend on our results of operations, financial condition, business conditions and other factors deemed relevant by our Board of Directors. However, we presently expect that dividends will continue to be paid.

This Form 10-Q contains certain forward-looking statements and expectations regarding the Company’s future performance and the performance of its brands. Such statements are subject to various risks and uncertainties that could cause actual results to differ materially. These risks include (i) changes in United States and international trade policies, including tariffs and trade restrictions; (ii) changing consumer demands, which may be influenced by general economic conditions and other factors; (iii) inflationary pressures and supply chain disruptions; (iv) rapidly changing consumer preferences and purchasing patterns and fashion trends; (v) supplier concentration, customer concentration and increased consolidation in the retail industry; (vi) intense competition within the footwear industry; (vii) foreign currency fluctuations; (viii) political and economic conditions or other threats to the continued and uninterrupted flow of inventory from China and other countries, where the company relies heavily on third-party manufacturing facilities for a significant amount of its inventory; (ix) transitional challenges with acquisitions and divestitures; (x) cybersecurity threats or other major disruption to the company’s information technology; (xi) the ability to accurately forecast sales and manage inventory levels; (xii) a disruption in the company’s distribution centers; (xiii) the ability to recruit and retain senior management and other key associates; (xiv) the ability to secure/exit leases on favorable terms; (xv) changes to tax laws, policies and treaties; (xvi) our commitments and shareholder expectations related to responsible business initiatives; (xvii) compliance with applicable laws and standards with respect to labor, trade and product safety issues; and (xviii) the ability to attract, retain, and maintain good relationships with licensors and protect our intellectual property rights. The Company’s reports to the Securities and Exchange Commission contain detailed information relating to such factors, including, without limitation, the information under the caption “Risk Factors” in Part I, Item 1A of the Company’s Annual Report on Form 10-K for the year ended January 31, 2026, which information is incorporated by reference herein and updated by the Company’s Quarterly Reports on Form 10-Q. The Company does not undertake any obligation or plan to update these forward-looking statements, even though its situation may change.