Children's Place Inc (PLCE) 2023 Q2 法說會逐字稿

Good morning, and welcome to The Children's Place Second Quarter 2023 Earnings Conference Call. On the call today are Jane Elfers, President and Chief Executive Officer; Maegan Markee, Brand President; Sheamus Toal, Chief Operating Officer and Chief Financial Officer; and Josh Truppo, Vice President, Financial Planning and Analysis.

早上好，歡迎參加 The Children's Place 2023 年第二季度收益電話會議。今天參加電話會議的是總裁兼首席執行官 Jane Elfers；梅根·馬基 (Maegan Markee)，品牌總裁； Sheamus Toal，首席運營官兼首席財務官；喬什·特魯波 (Josh Truppo)，財務規劃與分析副總裁。

(Operator Instructions) The Children's Place issued its second quarter 2023 earnings press release earlier this morning, and a copy of the release and presentation materials have been posted to the Investor Relations section of the company's website.

（操作員指示）The Children's Place 今天上午早些時候發布了 2023 年第二季度收益新聞稿，新聞稿和演示材料的副本已發佈到公司網站的投資者關係部分。

Before we begin, let me remind you that statements made on this conference call and in the company's earnings release and presentation materials about the company's outlook, plans and future performance are forward-looking statements. Actual results may differ materially from those projected. For a discussion of factors that could cause actual results to vary from those contained in the forward-looking statements, please refer to the company's most recent annual and quarterly reports filed with the Securities and Exchange Commission and the presentation materials posted on the company's website.

在開始之前，請允許我提醒您，本次電話會議以及公司收益發布和演示材料中有關公司前景、計劃和未來業績的陳述均為前瞻性陳述。實際結果可能與預測結果存在重大差異。有關可能導致實際結果與前瞻性陳述中包含的結果不同的因素的討論，請參閱公司向美國證券交易委員會提交的最新年度和季度報告以及公司網站上發布的演示材料。

On this call, the company will reference various non-GAAP financial measurements. A reconciliation of these non-GAAP financial measurements to the GAAP financial measurements is provided in the company's earnings release and presentation materials.

在這次電話會議上，該公司將參考各種非公認會計準則財務衡量標準。公司的收益發布和演示材料中提供了這些非公認會計原則財務衡量標準與公認會計原則財務衡量標準的調節表。

Also today's call is being recorded.

今天的通話也被錄音。

It is now my pleasure to turn the call over to Jane Elfers.

現在我很高興將電話轉給簡·埃爾弗斯。

Thank you, and good morning, everyone. Before we get started, I want to congratulate Meagan and Sheamus on their recent promotions, and welcome Mary Beth Sheridan to our team. I'm looking forward to partnering with them as we continue to advance the company's digital-first strategy.

謝謝大家，大家早上好。在我們開始之前，我要祝賀 Meagan 和 Sheamus 最近的晉升，並歡迎 Mary Beth Sheridan 加入我們的團隊。我期待與他們合作，繼續推進公司的數字優先戰略。

Our Q2 results exceeded our guidance on both the top and bottom line. The top line beat was the result of our strong digital performance, fueled by a strong start to back-to-school, driven by our successful first-to-market, back-to-school digital marketing strategies and our on-trend product assortments.

我們第二季度的業績在營收和利潤上都超出了我們的指導。營收的增長是我們強勁的數字業績的結果，這得益於我們成功的率先上市、返校數字營銷策略和我們的流行產品種類，推動了返校的強勁開局。 。

In addition, Amazon delivered another outstanding quarter. The bottom line beat was the result of our continued focus on expense management. With respect to monthly sales cadence, May was our weakest month, June improved significantly with the kickoff of our back-to-school campaign and July was our strongest month of the quarter.

此外，亞馬遜還發布了另一個出色的季度業績。淨利潤的增長是我們持續關注費用管理的結果。就月度銷售節奏而言，五月是我們最弱的月份，六月隨著返校活動的啟動而顯著改善，七月是我們本季度最強的月份。

Our e-commerce sales were up low single-digits for both the month of June and the month of July, driven by a low double-digit increase in e-commerce traffic for the quarter. Our e-commerce channel represented an industry-leading 51% of our retail sales in Q2, up from 47% last year and 30% in 2019. We haven't touched on birth rates for a while, so I wanted to take a moment to update you on how we think about birth rates within the context of our digital-first strategy. As we've said for the past decade, we do not anticipate birth rate increases when we plan our business, and it's a good thing we don't. Just to refresh everyone, here are some facts on birth rates, pre versus post pandemic. Birth rates hit their peak at 4.3 million in 2008 and have never recovered since. In 2019, prepandemic, births were 3.75 million. In 2020, they dipped to 3.6 million, a 40-year record low, and stayed at those approximate levels for 2021 and 2022. And for 2023, birth rates are projected to remain flat to 2022.

受本季度電子商務流量低兩位數增長的推動，我們的 6 月和 7 月電子商務銷售額均實現低個位數增長。第二季度，我們的電子商務渠道佔零售額的 51%，處於行業領先地位，高於去年的 47% 和 2019 年的 30%。我們已經有一段時間沒有觸及出生率了，所以我想花點時間向您介紹我們在數字優先戰略背景下如何看待出生率。正如我們在過去十年中所說的那樣，我們在規劃業務時並沒有預期出生率會上升，我們沒有這樣做是一件好事。為了讓大家耳目一新，這裡有一些關於大流行前後出生率的事實。出生率在 2008 年達到峰值 430 萬，此後再也沒有恢復過。 2019年，疫情爆發前，出生人數為375萬。 2020 年，出生率降至 360 萬人，創下 40 年來的新低，並在 2021 年和 2022 年保持在大致水平。2023 年，出生率預計將保持不變，直至 2022 年。

We believe that market share gains, not hoping for a baby boom, is what will move the needle for our business. And we believe that in order to gain share in the future, digital needs to be our top priority. The digital channels are where our current core millennial customer prefers to shop for her kids. And based on the data, digital is where our future Gen Z moms will overwhelmingly prefer to transact. Almost all new digital buyers will come from Gen Z. Gen Z digital buyers will surge from 45 million today to over 61 million in 2027, only 4 short years away.

我們相信，市場份額的增長，而不是嬰兒潮的到來，將推動我們的業務發展。我們相信，為了在未來獲得份額，數字化需要成為我們的首要任務。數字渠道是我們當前的核心千禧一代客戶更喜歡為孩子購物的地方。根據數據，數字化是我們未來的 Z 世代媽媽們絕大多數更喜歡進行交易的方式。幾乎所有新的數字買家都將來自 Z 世代。Z 世代的數字買家將從目前的 4500 萬激增至 2027 年的 6100 萬以上，而這僅僅需要 4 年的時間。

Mobile or m-commerce is where Gen Z overwhelmingly prefers to do their digital shopping. So as Gen Z becomes our next generation of core customers, it is critical that we make sure we are ready for them. The importance of the digitally native Gen Z demographic to our future business cannot be underestimated, and that is why we prioritized mobile-first as the cornerstone of our digital transformation several years ago.

Z 世代絕大多數人更喜歡通過移動或移動商務進行數字購物。因此，隨著 Z 世代成為我們的下一代核心客戶，我們必須確保為他們做好準備，這一點至關重要。數字原生 Z 世代人口對我們未來業務的重要性不容低估，這就是為什麼我們幾年前優先考慮移動優先作為我們數字化轉型的基石。

Maegan will provide more detail on our progress in this area in her prepared remarks.

梅根將在她準備好的發言中提供有關我們在這一領域取得的進展的更多細節。

Moving on. We have previously shared our expectation that once we were past the pandemic and the historic supply chain upheaval and unprecedented cost, we would be in a better position to assess our accelerated strategic transformation from a legacy store operating model to a digital-first model, and to capitalize on the efficiencies of the new model. We've learned a lot since 2019, and it's clear to us that because we accelerated our digital transformation and our fleet optimization strategies, we are more efficient and streamlined and can now operate the company more effectively with less resources, less stores, less inventory, less people and less expense, resulting in what we believe will translate to more consistent and sustainable results and more operating profit.

繼續。我們之前曾表達過我們的期望，一旦我們度過了大流行、歷史性的供應鏈劇變和前所未有的成本，我們將能夠更好地評估我們從傳統商店運營模式到數字優先模式的加速戰略轉型，並且充分利用新模式的效率。自2019 年以來，我們學到了很多東西，我們很清楚，由於我們加快了數字化轉型和機隊優化戰略，我們變得更加高效和精簡，現在可以用更少的資源、更少的商店、更少的庫存更有效地運營公司、更少的人員和更少的費用，我們相信這將轉化為更一致和可持續的結果以及更多的營業利潤。

In his prepared remarks, Sheamus will cover the following topics and how they are planned to positively impact our financial performance in the short term and beyond. Less stores. Our accelerated store closure strategy and its critically important impact on our future performance as we trade off low-quality store sales for higher-margin e-commerce and wholesale revenue. Less inventory. As we move beyond 2023 and the high costs embedded in our inventory, we have the ability to operate the company at lower inventory levels versus prepandemic as a direct result of our transformation from a legacy store operating model to a digital-first model.

在他準備好的講話中，希莫斯將涵蓋以下主題，以及它們計劃如何對我們的短期及以後的財務業績產生積極影響。商店較少。我們加速關閉商店的策略及其對我們未來業績的至關重要的影響，因為我們用低質量的商店銷售來換取更高利潤的電子商務和批發收入。庫存少。隨著 2023 年過去，庫存成本高昂，我們有能力以比疫情前更低的庫存水平運營公司，這是我們從傳統商店運營模式向數字優先模式轉型的直接結果。

Less people. The ability to operate the company with a lower corporate head count versus pre-pandemic as a direct result of our transformation from a legacy store operating model to a digital-first model. And less expense, our ability to operate the company with a lower, permanent fixed expense structure as a direct result of our transformation from a legacy store operating model to a digital-first model, with significantly expanded digital and wholesale businesses, all leading to more consistent and sustainable results and the opportunity for expanded operating margin versus prepandemic levels.

人少了。與大流行前相比，我們能夠以更少的員工人數來運營公司，這是我們從傳統商店運營模式轉變為數字優先模式的直接結果。費用更少，我們能夠以較低的、永久的固定費用結構運營公司，這是我們從傳統商店運營模式轉變為數字優先模式的直接結果，並且顯著擴展了數字和批發業務，所有這些都帶來了更多一致和可持續的結果以及與大流行前水平相比擴大營業利潤的機會。

But before we get to Sheamus, I will turn it over to Meagan to discuss the significant progress we have made pre versus post pandemic with respect to our marketing transformation and marketing's impact on our business. pre and post pandemic. Meagan?

但在我們討論希莫斯之前，我將把它交給梅根，討論我們在大流行之前和之後在營銷轉型和營銷對我們業務的影響方面取得的重大進展。大流行之前和之後。梅根？

Thank you, Jane, and good morning, everyone. I will focus my remarks today on the 4 key initiatives that have propelled our marketing transformation and the impact the transformation has had on our results pre versus post pandemic. It's clear from our conversations that a lot of you are not familiar with, and would like to learn more about the award-winning partners we work with, the state-of-the-art proprietary marketing tools that we leverage every day to measure and maximize our results, the effectiveness of our marketing spend and the results of our significant shift to nontraditional media since the start of the pandemic.

謝謝你，簡，大家早上好。我今天的發言將重點討論推動我們營銷轉型的 4 項關鍵舉措，以及這些轉型對我們在大流行前後的業績的影響。從我們的對話中可以清楚地看出，你們中的很多人都不熟悉，並且希望更多地了解與我們合作的屢獲殊榮的合作夥伴，以及我們每天用來衡量和衡量的最先進的專有營銷工具。最大限度地提高我們的成果、營銷支出的有效性以及自大流行開始以來我們向非傳統媒體的重大轉變的結果。

The 4 key initiatives that I'll cover today that underpin our successful marketing transformation are: our partners, real-time optimized media measurement, marketing spend and traditional versus nontraditional marketing. First, our best-in-class partners who support us behind the scenes. Prior to the pandemic, the marketing organization was siloed. This siloed approach did not allow us to effectively and efficiently plan, execute, optimize and ultimately measure the effectiveness of our investments. Since then, we've centralized our partners, teams and budgets and onboarded data and measurement solutions that allow us in real time to strategically drive our business KPIs.

我今天將介紹支撐我們成功營銷轉型的 4 項關鍵舉措：我們的合作夥伴、實時優化的媒體衡量、營銷支出以及傳統營銷與非傳統營銷。首先，我們一流的合作夥伴在幕後支持我們。在大流行之前，營銷組織是孤立的。這種孤立的方法不允許我們有效且高效地規劃、執行、優化並最終衡量我們投資的有效性。從那時起，我們集中了我們的合作夥伴、團隊和預算，並採用了數據和測量解決方案，使我們能夠實時戰略性地推動我們的業務 KPI。

Our partners. Ipsos MMA supports us across multi-touch attribution, marketing mix modeling and incrementality measurement. Ipsos MMA has been evaluated and scored as a leader by Forrester for its unified customer attribution approach and activate marketing, planning and optimization platform. We leverage the ACTIVATE platform daily within our organization. From a media perspective, we partner with an industry-leading digital media and measurement firm that helps clients drive and deliver measurable marketing performance. This team of experts specializes across all digital marketing mediums and partners with our in-house team on a daily basis.

我們的伙伴。 Ipsos MMA 在多點觸控歸因、營銷組合建模和增量測量方面為我們提供支持。 Ipsos MMA 因其統一的客戶歸因方法以及激活的營銷、規劃和優化平台而被 Forrester 評估為領導者。我們每天在組織內利用 ACTIVATE 平台。從媒體角度來看，我們與行業領先的數字媒體和衡量公司合作，幫助客戶推動和提供可衡量的營銷績效。該專家團隊專注於所有數字營銷媒介，並每天與我們的內部團隊合作。

Our 2 industry-leading partners are critical to the second initiative, optimized media measurement. The degree of effectiveness of any marketing strategy is heavily reliant on accurate measurement. Prior to the pandemic, we did not have the forward forecasting tools or visibility, which hindered our ability to optimize our marketing investments. With the adoption of our customer-centric marketing strategy came the need for a unified measurement approach across all of our touch points. Ipsos MMA has successfully solutioned 1 of the biggest marketing measurement challenges in the industry with the launch of its unified marketing planning platform, a marketing attribution, optimization and simulation solution that captures a holistic range of omnichannel business drivers.

我們的兩個行業領先的合作夥伴對於第二項舉措（優化媒體衡量）至關重要。任何營銷策略的有效性很大程度上取決於準確的衡量。在大流行之前，我們沒有前瞻性預測工具或可見性，這阻礙了我們優化營銷投資的能力。隨著我們採用以客戶為中心的營銷策略，我們需要在所有接觸點上採用統一的衡量方法。 Ipsos MMA 推出了統一營銷規劃平台，成功解決了業內最大的營銷衡量挑戰之一，該平台是一種營銷歸因、優化和模擬解決方案，可捕獲全面的全渠道業務驅動因素。

This platform delivers real-time optimization across all marketing touch points, providing us with accurate results and validated sales predictions, enabling us to generate measurable incremental sales and profit to help us to more strategically deploy every marketing dollar and to measure, in real time, the effectiveness of those dollars. Both our measurement and media partners support our in-house team on marketing strategy and media execution on a daily basis, which leads to our third initiative, marketing spend.

該平台在所有營銷接觸點上提供實時優化，為我們提供準確的結果和經過驗證的銷售預測，使我們能夠產生可衡量的增量銷售和利潤，幫助我們更有戰略性地部署每一筆營銷資金，並實時衡量，這些美元的有效性。我們的衡量和媒體合作夥伴每天都為我們的內部團隊提供營銷策略和媒體執行方面的支持，這導致了我們的第三項舉措——營銷支出。

In 2019, our total marketing spend was less than 2% of revenue versus the industry average for multichannel brands of 5% to 7%. Our marketing spend, as reported, includes not only digital marketing, advertising, celebrity partnerships and creative for our site, it also includes the costs associated with our loyalty program as well as our store signage and print materials. As we complete our fleet optimization initiative at the end of this year, our ability to expose customers to our brand has shifted from high-cost traditional brick-and-mortar billboards, which were effectively part of rent expense, to digital-first acquisition strategy.

2019 年，我們的總營銷支出不到收入的 2%，而多渠道品牌的行業平均水平為 5% 至 7%。據報導，我們的營銷支出不僅包括數字營銷、廣告、名人合作夥伴關係和我們網站的創意，還包括與我們的忠誠度計劃以及商店標牌和印刷材料相關的成本。隨著我們在今年年底完成車隊優化計劃，我們向客戶展示我們品牌的能力已經從高成本的傳統實體廣告牌（實際上是租金費用的一部分）轉變為數字優先的收購策略。

Our incremental marketing investment in 2023 and beyond, which we have self-funded through efficiencies in our digital-first operating model, are anticipated to be in the mid-single-digit range, in line with our specialty peers.

我們通過數字優先運營模式的效率自籌資金，在 2023 年及以後增加營銷投資，預計將在中個位數範圍內，與我們的專業同行一致。

Our working media investment is now focused on full funnel marketing, which is made up of top of funnel, mid-funnel and lower funnel tactics. Unlike lower funnel tactics, which are aimed at speaking to shoppers who have already expressed purchase intent, top of funnel marketing serves to spread awareness, educate prospects and cultivate brand buzz. Lastly, our fourth initiative, traditional versus nontraditional marketing. In 2019, our budget was almost solely focused on traditional marketing investments of e-mail and retail signage. Shortly after the onset of the pandemic, when our core millennial customers' behavior rapidly shifted to mass and online consumption, we made the strategic decision to significantly accelerate our store closures.

我們的工作媒體投資現在集中在全漏斗營銷，由漏斗頂部、漏斗中部和漏斗下部策略組成。與旨在與已表達購買意向的購物者交談的下漏斗策略不同，漏斗頂部營銷旨在傳播意識、教育潛在客戶並培養品牌知名度。最後，我們的第四項舉措，傳統營銷與非傳統營銷。 2019 年，我們的預算幾乎完全集中在電子郵件和零售標牌的傳統營銷投資上。疫情爆發後不久，當我們的核心千禧一代客戶的行為迅速轉向大眾和在線消費時，我們做出了大幅加速關店的戰略決策。

These accelerated shifts in consumer behavior and company strategy demanded an accelerated marketing transformation with significantly different marketing investments. It was critical that our marketing strategy and investment shifts were rooted in accurate customer data, which led us to commission a deep enterprise customer segmentation analysis at the start of the pandemic as the first important step to inform our digital marketing transformation strategy. As the result of our segmentation work, we are now focused on investing in nontraditional marketing, which simply [put] is any strategic marketing activity or tactic that uses innovative methods to reach a target audience. We're laser-focused on meeting and serving our millennial mom wherever, whenever and however she wants to interact with our brands, whether that's on social media, in her Gmail through celebrity and influencer she's inspired by or streaming a video on Hulu or YouTube. We need to be everywhere that she is.

消費者行為和公司戰略的加速轉變要求通過顯著不同的營銷投資來加速營銷轉型。至關重要的是，我們的營銷策略和投資轉變植根於準確的客戶數據，這促使我們在疫情爆發之初委託進行了深入的企業客戶細分分析，作為為我們的數字營銷轉型策略提供信息的第一個重要步驟。作為我們細分工作的結果，我們現在專注於投資非傳統營銷，簡單地說，就是使用創新方法接觸目標受眾的任何戰略營銷活動或策略。我們專注於滿足並服務我們的千禧一代媽媽，無論何時何地，以何種方式與我們的品牌互動，無論是在社交媒體上，還是通過受她啟發的名人和影響者在她的Gmail中，或者在Hulu 或YouTube 上播放視頻。我們需要去她所在的任何地方。

Since launching our revamped marketing strategies in the back half of 2022, supported by our best-in-class partners and state-of-the-art marketing tools, we have significantly shifted the way we utilize media, and we've seen great success in our results.

自 2022 年下半年推出改進後的營銷策略以來，在我們一流的合作夥伴和最先進的營銷工具的支持下，我們已經顯著改變了利用媒體的方式，並取得了巨大的成功在我們的結果中。

Now let's review some of those results starting with acquisitions. As we've discussed on several occasions, a robust digital acquisition strategy is critical to our success as a digital-first retailer. We're pleased to share that during an incredibly challenging retail environment, Q2 was our fourth consecutive quarter of increased acquisition, with U.S. acquisition up 8% to last year. Even more impressive when you consider that our Q2 acquisition was approximately flat to 2019 with more than 350 or approximately 40% less stores.

現在讓我們從收購開始回顧其中的一些結果。正如我們多次討論的那樣，強大的數字收購策略對於我們作為數字優先零售商的成功至關重要。我們很高興與大家分享，在極具挑戰性的零售環境中，第二季度是我們連續第四個季度增加收購量，其中美國的收購量比去年增長了 8%。更令人印象深刻的是，我們第二季度的收購與 2019 年大致持平，商店數量超過 350 家，即減少了約 40%。

Our positive acquisition trend is the direct result of our transformed marketing and media mix strategies that strategically target the total addressable market in order to drive new customer acquisition. Those new strategies, combined with our broader digital first strategy, have resulted in 57% of our acquisition coming through our digital channels versus 37% prepandemic. This is a significant shift and one that we believe puts us substantially ahead of our competition as we work to acquire millennial and Gen Z customers into our family of brands.

我們積極的收購趨勢是我們營銷和媒體組合戰略轉型的直接結果，這些策略戰略性地瞄準整個潛在市場，以推動新客戶的收購。這些新戰略與我們更廣泛的數字優先戰略相結合，使我們 57% 的收購來自我們的數字渠道，而疫情爆發前這一比例為 37%。這是一個重大轉變，我們相信，在我們努力吸引千禧一代和 Z 世代客戶加入我們的品牌系列時，這一轉變使我們在競爭中處於顯著領先地位。

Next, brand buzz, which is an incredibly exciting and important initiative for us as we transform to a digital-first operating model. Our brand work specifically has been transformative pre versus post pandemic. Prepandemic top-of-funnel brand awareness from both an earned and paid perspective was not a focus. We relied on our legacy store operating model to generate brand awareness and new customer acquisition. With our core millennial customers' significant migration to mass and online channels since the start of the pandemic, we could no longer rely on the store channel to generate the majority of our brand awareness and customer acquisition. We needed to apply a customer-centric lens to every customer touch point, and that starts with an engaging and [noise-cutting] content strategy that serve to mom via digital media mediums we know that she consumes.

接下來是品牌熱度，隨著我們向數字優先運營模式轉型，這對我們來說是一項非常令人興奮且重要的舉措。具體來說，我們的品牌工作在大流行之前和之後都具有變革性。從賺取和付費的角度來看，大流行前漏斗頂部的品牌知名度並不是重點。我們依靠傳統的商店運營模式來提高品牌知名度和獲取新客戶。自大流行開始以來，隨著我們的核心千禧一代客戶大量轉向大眾和在線渠道，我們不能再依賴商店渠道來產生我們的大部分品牌知名度和客戶獲取。我們需要將以客戶為中心的視角應用於每個客戶接觸點，而這首先是通過我們知道媽媽消費的數字媒體媒體為媽媽提供引人入勝且[消除噪音]的內容策略。

Since launching our branding initiatives in the back half of 2022, we've garnered over 159 billion earned and paid media impressions. Our business relied on our store presence to drive brand awareness and engagement prepandemic. So all of these brand activations are net new and have transformed our brand awareness. In tandem, driven by our incredibly loyal communities during the same time period, the growth of our social media presence and our social engagement has been explosive. Since the back half of 2022, our brands drove over 3.4 million social interactions, which represents a 3,000% increase over prepandemic levels.

自 2022 年下半年推出品牌計劃以來，我們已獲得超過 1,590 億次免費媒體印象。我們的業務依靠我們的商店來提高大流行前的品牌知名度和參與度。因此，所有這些品牌激活都是全新的，並且改變了我們的品牌知名度。與此同時，在同一時期我們極其忠誠的社區的推動下，我們的社交媒體存在和社會參與度呈爆炸性增長。自 2022 年下半年以來，我們的品牌促成了超過 340 萬次社交互動，比大流行前的水平增加了 3,000%。

Our social strategy has bolted The Children's Place brands into the leadership position across social media impressions, with our brand representing 62% of total impressions and 60% of social interactions across our children's competitive set, making The Children's Place the dominant player on social media for 2022 and for 2023 year-to-date.

我們的社交策略使 The Children's Place 品牌在社交媒體印象方面處於領先地位，我們的品牌佔兒童競爭群體中總印象的 62% 和社交互動的 60%，使 The Children's Place 在社交媒體上佔據主導地位2022年和2023 年迄今。

Lastly, marketing contribution pre and post pandemic. Marketing contribution is the percentage of total revenue directly attributed to marketing efforts. In 2019, marketing contributed approximately 13% of digital sales. In Q2 of 2023, marketing contribution has grown to over 20% of digital sales. During this time period, promotions and promotional activity experienced a 300-basis-point decrease in contribution to digital sales. Our growth in digital marketing contribution has allowed us to reduce our reliability on promotional activity to drive digital sales as compared to prepandemic, further validating the sustainability of our structural pricing reset.

最後，大流行前後的營銷貢獻。營銷貢獻是直接歸因於營銷工作的總收入的百分比。 2019年，營銷貢獻了約13%的數字銷售額。 2023 年第二季度，營銷貢獻已增長至數字銷售額的 20% 以上。在此期間，促銷和促銷活動對數字銷售的貢獻下降了 300 個基點。與大流行前相比，我們在數字營銷貢獻方面的增長使我們能夠降低推動數字銷售的促銷活動的可靠性，進一步驗證了我們結構性定價重置的可持續性。

Even in 1 of the most challenging retail environments we have ever experienced, the success of our post-pandemic marketing transformation is clear. Our marketing transformation has been a critically important element to our overall transformation from a legacy store operating model to a digital-first retailer. We now have the right partners, the right tools and the right team to drive meaningful reach, to drive qualified traffic, to scale our digital penetration and to acquire net new audiences into our family of brands through a full-funnel marketing strategy. And the most exciting part is that we're just getting started, and we have significant opportunity ahead of us to continue to leverage our partners and our learnings.

即使在我們經歷過的最具挑戰性的零售環境之一中，我們的大流行後營銷轉型的成功也是顯而易見的。我們的營銷轉型對於我們從傳統商店運營模式向數字優先零售商的整體轉型至關重要。我們現在擁有合適的合作夥伴、合適的工具和合適的團隊來推動有意義的影響力、推動合格的流量、擴大我們的數字滲透率，並通過全渠道營銷策略為我們的品牌家族吸引新的淨受眾。最令人興奮的是，我們才剛剛開始，我們面前有重要的機會來繼續利用我們的合作夥伴和我們的經驗。

Now let's briefly review our Q2 marketing results. As a leader in the digital space, we know that our core, digitally savvy millennial customer browses and purchases for all of the special and emotional events in their children's lives earlier than our in-store shopper does. Combining this behavioral shopper knowledge with our leadership position in back-to-school, we launched a first-to-market back-to-school brand campaign approximately 1 month earlier than our historical launch date with the goal of capturing in-market demand and market share.

現在讓我們簡單回顧一下我們第二季度的營銷結果。作為數字領域的領導者，我們知道我們的核心、精通數字的千禧一代客戶比我們的店內購物者更早地瀏覽和購買孩子生活中的所有特殊和情感事件。將這種購物者行為知識與我們在返校季的領導地位相結合，我們比我們的歷史發布日期早了大約 1 個月，推出了首次上市的返校季品牌活動，目的是捕捉市場需求並市場份額。

Our intentional pull-up strategy was our curtains up moment across every aspect of our business, and supported by our strong product launches, our multipronged full-funnel media strategies are buzzworthy creative and are strategic targeting. Importantly, we saw a positive inflection in our business immediately following the launch.

我們有意的拉動戰略是我們業務各個方面的拉開帷幕的時刻，在我們強大的產品發布的支持下，我們多管齊下的全渠道媒體戰略是值得關注的創意和戰略目標。重要的是，我們的業務在推出後立即出現了積極的變化。

Our first-to-market back-to-school campaign launch included headliners and global pop superstars, the Jonas Brothers, and was strategically timed to coincide with the band's comeback reunion and highly anticipated debut of their newest album. Typically, brand campaigns of this sort have long-tail impact. However, as expected, our first-to-market back-to-school campaign impacted our business day 1. We delivered positive single-digit e-commerce comps for both the month of June and the month of July, fueled by low double-digit e-commerce traffic increases for the quarter, which we believe puts us significantly ahead of our competition with respect to our digital results.

我們首次推出的返校活動包括頭條新聞和全球流行巨星喬納斯兄弟，並且戰略性地選擇了與樂隊的複出重聚和備受期待的最新專輯首秀相一致的時間。通常，此類品牌活動具有長尾影響。然而，正如預期的那樣，我們的首次上市返校活動影響了我們的第1 個工作日。在低雙倍的推動下，我們在6 月和7 月都實現了正個位數的電子商務業績。本季度數字電子商務流量有所增加，我們相信這使我們在數字結果方面顯著領先於競爭對手。

Since the launch of our first-to-market back-to-school campaign, we have delivered over 15 billion impressions across our earned and paid media efforts, and further supported by our continued dominance on social media with The Children's Place taking the #1 rank amongst our children's competitive set.

自推出首個返校活動以來，我們的免費媒體和付費媒體宣傳活動已獲得超過 150 億次展示，並進一步支持了我們在社交媒體上的持續主導地位（The Children's Place 排名第一）躋身我們孩子的競爭隊伍之列。

We have shared with you many times that mobile is the cornerstone of our digital-first strategy due to how important mobile is to the core millennial customer. And as Jane covered in her prepared remarks, mobile is exponentially more important to our emerging Gen Z customers. So it's critical that we stay ahead of this important cohort. 80% of our U.S. digital transactions occurred on a mobile device during the second quarter, a new quarterly record for us.

我們多次與您分享，由於移動對於千禧一代核心客戶的重要性，移動是我們數字優先戰略的基石。正如 Jane 在她準備好的發言中所提到的，移動對於我們新興的 Z 世代客戶來說更加重要。因此，我們在這一重要群體中保持領先地位至關重要。第二季度，我們 80% 的美國數字交易發生在移動設備上，這是我們的新季度記錄。

Now let's move on to mobile app. The mobile app is a very important part of our overall mobile strategy since our mobile app customers spend approximately 100% more than non-app users and shop approximately 80% more than non-app users. Since kicking off our back-to-school launch with our mobile app tie-in, we've experienced a 48% lift in mobile app downloads. Our targeted mobile app strategies have driven a significant increase in mobile app transactions and mobile app users. In Q2, our mobile app accounted for 20% of our U.S. digital transactions versus 16% in Q2 of 2022 and 7% in Q2 of 2019, fueled by an impressive 21% increase in mobile app customers versus last year.

現在讓我們轉向移動應用程序。移動應用程序是我們整體移動戰略中非常重要的一部分，因為我們的移動應用程序客戶的支出比非應用程序用戶多約 100%，購物量比非應用程序用戶多約 80%。自從通過移動應用程序配合推出返校季以來，我們的移動應用程序下載量增長了 48%。我們有針對性的移動應用策略推動了移動應用交易和移動應用用戶的顯著增長。第二季度，我們的移動應用程序占美國數字交易的20%，而2022 年第二季度為16%，2019 年第二季度為7%，這得益於移動應用程序客戶較去年增長了21% 。

I'll finish with an update on our growing Amazon business. The significant time and resources that we have dedicated towards building our Amazon marketplace since the beginning of the pandemic have resulted in another outstanding quarter. Amazon site sales and traffic were both up triple digits in Q2 versus Q2 of 2022. We participated in July Prime Day events, resulting in TCP's largest week on Amazon in our history. It's really incredible when we compare our relationship with Amazon today versus prepandemic. The progress that we have made on both sides has been transformational. And again, the exciting part is that we believe we have significant opportunity for continued wholesale growth in the back half of this year and beyond with this important partner.

最後，我將介紹我們不斷增長的亞馬遜業務的最新情況。自大流行開始以來，我們投入了大量的時間和資源來建設亞馬遜市場，這導致了另一個出色的季度。與 2022 年第二季度相比，亞馬遜網站銷售額和流量均增長了三位數。我們參加了 7 月的 Prime Day 活動，導致 TCP 成為我們歷史上亞馬遜上最大的一周。當我們將今天與亞馬遜的關係與大流行前的關係進行比較時，這確實令人難以置信。我們雙方取得的進展是變革性的。令人興奮的是，我們相信，在今年下半年及以後，我們將有機會與這個重要的合作夥伴一起實現批發持續增長。

Thank you. And now I will turn it over to Sheamus.

謝謝。現在我將把它交給希莫斯。

Thank you, Meagan, and good morning, everyone. We were pleased that despite the continued macroeconomic pressures, the second quarter exceeded our guidance from both a top and bottom line perspective. We continue to make significant progress on our inventory levels during the quarter. We liquidated more of our spring and summer product during the second quarter than we originally planned to ensure that we started the back half in an even a cleaner inventory position. Due to our efforts, our high AUC spring/summer inventory is down 27% versus last year, and our total Q2 ending inventory is down 13% year-over-year, significantly better than our guidance of down high single-digits.

謝謝你，梅根，大家早上好。我們感到高興的是，儘管宏觀經濟壓力持續存在，但第二季度的營收和利潤都超出了我們的指導。本季度我們的庫存水平繼續取得重大進展。我們在第二季度清算了比原計劃更多的春季和夏季產品，以確保我們以更乾淨的庫存狀況開始下半年。由於我們的努力，我們的高 AUC 春夏庫存比去年下降了 27%，第二季度期末庫存總額同比下降了 13%，明顯好於我們高個位數下降的指導。

Importantly, we believe that inventory strategies that we have in place going forward will result in continued improvement in our inventory position versus last year throughout the back half of 2023 and beyond.

重要的是，我們相信，我們未來製定的庫存策略將導致我們的庫存狀況在 2023 年下半年及以後的時間裡與去年相比持續改善。

Net sales for the second quarter decreased $35 million or 9% to $346 million, which exceeded our guidance. This better-than-expected result was primarily driven by our strong e-commerce performance and a strong start to back-to-school. These favorable results were in the face of continued macroeconomic challenges, including persistent inflation, a highly promotional retail environment and concerns over the resumption of student loan payments.

第二季度淨銷售額下降 3500 萬美元，即 9%，至 3.46 億美元，超出了我們的預期。這一好於預期的結果主要是由於我們強勁的電子商務表現和返校開局強勁所致。這些良好的業績是在面臨持續的宏觀經濟挑戰的情況下取得的，這些挑戰包括持續的通貨膨脹、高度促銷的零售環境以及對恢復學生貸款支付的擔憂。

Our U.S. net sales decreased by $41 million or 13% to $275 million, and our Canadian net sales decreased by $6 million or 18% to $29 million.

我們的美國淨銷售額下降了 4100 萬美元，即 13%，至 2.75 億美元；加拿大淨銷售額下降了 600 萬美元，即 18%，至 2900 萬美元。

Comparable store sales decreased 9% for the quarter. Our comparable store traffic was down approximately 4%, while our e-commerce traffic was up low double digits. Our comp store traffic decline was driven by pressure in the month of May with an improvement as we entered the key back-to-school selling period. However, our comp store traffic versus 2019 continues to be down more than 30%.

本季度可比商店銷售額下降 9%。我們的可比商店流量下降了約 4%，而我們的電子商務流量卻增長了兩位數。我們的商品商店客流量下降是由五月份的壓力推動的，隨著我們進入關鍵的返校銷售期，客流量有所改善。然而，與 2019 年相比，我們的比較店流量繼續下降 30% 以上。

While our consolidated AUR declined approximately 5% for the quarter, driven by the liquidation of spring and summer season merchandise, our AUR and go-forward basics and back-to-school product was up year-over-year. Importantly, AURs remain significantly higher than prepandemic levels, validating the success of our restructured pricing strategies, which we believe will pay significant dividends as input and transactional costs continue to come down in the back half of 2023.

雖然受春夏季節商品清倉的推動，本季度我們的綜合 AUR 下降了約 5%，但我們的 AUR 以及未來基本款和返校產品同比增長。重要的是，AUR 仍顯著高於大流行前的水平，驗證了我們重組定價策略的成功，我們相信隨著 2023 年下半年投入和交易成本的持續下降，該策略將帶來可觀的紅利。

Gross profit margin for the second quarter decreased to 25.4% of net sales as compared to 30.2% of net sales in the prior year. This reflects the combination of an unprecedented increasing input costs, including cotton and supply chain costs, the impact of accelerating our spring/summer liquidation starting in early June in order to enter Q3 in a stronger inventory position and the significant growth of our wholesale business, which operates at lower gross margins, but also operates at lower SG&A expenses and is accretive to our operating margin.

第二季度毛利率下降至淨銷售額的 25.4%，而去年同期為 30.2%。這反映了包括棉花和供應鏈成本在內的前所未有的投入成本增加、我們從六月初開始加速春夏清算以進入第三季度的庫存狀況以及我們批發業務顯著增長的影響，該公司的毛利率較低，但銷售管理及行政費用也較低，可以增加我們的營業利潤。

Adjusted SG&A was $102 million for the second quarter as compared to $114 million in the comparable period last year. This decrease was primarily a result of reductions in store expenses, home office payroll and equity compensation. As you heard from Meagan, marketing is a critical part of our digital transformation strategy, and we are pleased to be able to self-fund our incremental marketing needs for the balance of the year through efficiencies from our transformation to a digital-first operating model.

第二季度調整後的 SG&A 為 1.02 億美元，去年同期為 1.14 億美元。這一下降主要是由於商店費用、家庭辦公室工資和股權薪酬的減少。正如您從梅根那裡聽到的那樣，營銷是我們數字化轉型戰略的重要組成部分，我們很高興能夠通過向數字優先運營模式轉型的效率，為今年剩餘時間的增量營銷需求自籌資金。

Our net interest expense was $7.6 million for the quarter versus adjusted net interest expense of $2.6 million in the prior year's quarter. The increase in interest expense was driven by higher borrowings and higher average interest rates associated with the revolving credit facility and term loan due to increases in our variable rate based upon market rate increases.

本季度我們的淨利息支出為 760 萬美元，而去年同期調整後的淨利息支出為 260 萬美元。利息支出的增加是由於借款增加以及與循環信貸便利和定期貸款相關的平均利率上升所致，這是由於我們根據市場利率上漲而提高了可變利率。

Our adjusted tax rate for the quarter was approximately 19% as compared to 19% in the prior year.

我們本季度調整後的稅率約為 19%，而上一年為 19%。

For the second quarter, we reflected adjusted net loss of $26.5 million or $2.12 per share as compared to an adjusted net loss of $11.7 million or $0.89 per share in the comparable period last year. As the business has transformed from a legacy store operating model to a digital-first model, as previously announced, we implemented several planned actions, which resulted in nonoperating charges totaling approximately $12 million, consisting of approximately $6 million of employee severance, benefit costs, and professional fees associated with the workforce reduction, and approximately $5 million consisting of a lease termination payment, accelerated depreciation and other costs associated with the early termination of our corporate headquarter lease.

第二季度，調整後淨虧損為 2650 萬美元，即每股 2.12 美元，而去年同期調整後淨虧損為 1170 萬美元，即每股 0.89 美元。正如之前宣布的那樣，隨著業務從傳統商店運營模式轉變為數字優先模式，我們實施了幾項計劃行動，導致非運營費用總計約1200 萬美元，其中包括約600 萬美元的員工遣散費、福利成本、與裁員相關的專業費用，以及約 500 萬美元，包括租賃終止付款、加速折舊和與提前終止公司總部租賃相關的其他費用。

Moving to the balance sheet. We ended the quarter with cash and short-term investments of $19 million, and with $348 million of borrowings on our recently expanded revolving credit facility and a modest amount of long-term debt, which remains unchanged at $50 million. We continue to expect to decrease borrowings by more than $100 million by the end of 2023 versus the end of 2022, further positioning us for long-term sustainable growth.

轉向資產負債表。截至本季度末，我們擁有 1,900 萬美元的現金和短期投資，以及最近擴大的循環信貸額度的 3.48 億美元借款，以及少量長期債務，長期債務保持在 5,000 萬美元不變。我們仍然預計到 2023 年底，借款將比 2022 年底減少 1 億美元以上，進一步為我們實現長期可持續增長做好準備。

As I previously noted, during the quarter, we continued to make progress in our inventory reduction efforts. Q2 ending inventory levels were down approximately 13%, ahead of our expectations, enabling us to end in a healthier unit and cost position as we enter the important back-to-school selling period. We expect inventory levels to continue to be down versus last year throughout the balance of 2023, providing a significant opportunity to expand free cash flow.

正如我之前指出的，本季度我們在減少庫存方面繼續取得進展。第二季度末庫存水平下降了約 13%，超出了我們的預期，使我們能夠在進入重要的返校銷售期時以更健康的單位和成本狀況結束。我們預計 2023 年剩餘時間庫存水平將繼續下降，為擴大自由現金流提供了重要機會。

Moving on to cash flow and liquidity. We used $38 million of cash from operations in Q2 versus a use of $34 million last year. As we will discuss in our outlook, our digital-first model better positions us to generate free cash flow, which we expect will be considerable in the second half of the year. Capital expenditures in Q2 were $7 million.

接下來討論現金流和流動性。我們第二季度使用了 3800 萬美元的運營現金，而去年為 3400 萬美元。正如我們將在展望中討論的那樣，我們的數字優先模式使我們能夠更好地產生自由現金流，我們預計今年下半年的自由現金流將相當可觀。第二季度的資本支出為 700 萬美元。

During the second quarter, we closed 3 locations, ending the quarter with 596 stores. We continue to carefully evaluate our store fleet and close lower-volume, underperforming stores. With over 75% of our fleet coming up for lease action in the next 24 months, we maintain meaningful financial flexibility in our lease portfolio.

第二季度，我們關閉了 3 家門店，本季度末門店數量達到 596 家。我們繼續仔細評估我們的商店群並關閉銷量較低、業績不佳的商店。我們超過 75% 的機隊將在未來 24 個月內進行租賃行動，因此我們的租賃組合保持了有意義的財務靈活性。

As we look to the future, we remain confident that based upon our accelerated transformation to a digital-first retailer, we can operate the company with significantly less than we were able to do prior to the pandemic, less stores, less inventory, less people and less expense, resulting in more consistent and sustainable results and more operating margin.

展望未來，我們仍然有信心，在加速向數字化優先零售商轉型的基礎上，我們可以用比疫情之前大幅減少的成本、更少的商店、更少的庫存、更少的人員來運營公司。費用更少，從而獲得更一致和可持續的結果以及更高的營業利潤。

Let me cover these topics in greater detail. I will reference 2019 where appropriate, as 2019 represents the most recent prepandemic year, and for The Children's Place specifically, 2019 represents the best comparison pre our accelerated digital transformation.

讓我更詳細地介紹這些主題。我將在適當的情況下引用 2019 年，因為 2019 年代表了最近的大流行前一年，特別是對於兒童之家來說，2019 年代表了我們加速數字化轉型之前的最佳比較。

First, less stores. While we've talked at length about our real estate portfolio and our accelerated store closing strategy, I wanted to provide some hard facts that illustrate the significant financial benefits of our store closure strategy. Since 2016, we have closed 495 stores. And since 2019, we've closed 392 stores. With the expected 80 to 100 store closures this year, we will have closed almost 600 stores since 2016. We estimate that traffic to these stores that we have closed since 2019 would have been down over 30% versus 2019, resulting in significantly lower store productivity, which, when combined with higher occupancy costs, higher wage rates, significantly higher shrink and retail theft and the inflationary pressures on corporate overhead, would have resulted in these stores losing tens of millions of dollars on an annualized basis.

一是門店少。雖然我們詳細討論了我們的房地產投資組合和加速關閉商店策略，但我想提供一些確鑿的事實來說明我們關閉商店策略的顯著財務收益。自 2016 年以來，我們已經關閉了 495 家門店。自 2019 年以來，我們已經關閉了 392 家門店。預計今年將關閉80 至100 家商店，自2016 年以來我們將關閉近600 家商店。我們估計，自2019 年以來我們關閉的這些商店的客流量將比2019 年下降30% 以上，導致商店生產力大幅下降，再加上更高的入住成本、更高的工資率、顯著增加的損耗和零售盜竊以及企業管理費用的通貨膨脹壓力，將導致這些商店按年計算損失數千萬美元。

We have historically transferred more than 30% of the revenue from closed stores to adjacent locations and to our digital channel, which clearly helps mitigate the loss of revenue and provide a vehicle to retain customers. Additionally, the closed stores were significantly less effective in liquidating inventory, creating margin pressure as compared to our digital channel. We estimate that had these stores remained open, they would have required in excess of $50 million of working capital to fund a full inventory assortment, creating a significant strain on our working capital availability.

過去，我們將超過 30% 的收入從關閉的商店轉移到鄰近地點和我們的數字渠道，這顯然有助於減輕收入損失並提供留住客戶的手段。此外，與我們的數字渠道相比，關閉的商店在清理庫存方面的效率明顯較低，從而造成了利潤壓力。我們估計，如果這些商店繼續營業，他們將需要超過 5000 萬美元的營運資金來為完整的庫存分類提供資金，這對我們的營運資金可用性造成了巨大壓力。

Importantly, while the store rationalization program has resulted in the closure of underperforming stores that no longer strategically aligned with our core customer, our fleet optimization strategy has enabled us to establish a new go-forward target base of approximately 500 stores ending for the full year 2023. The composition of our new 500 store base is much more heavily weighted towards outlets versus prepandemic. Outlets are our most productive and profitable store type. And entering 2024, we expect that outlets will represent approximately 22% of our stores versus 14% in 2019, and approximately 30% of our store sales versus 20% of sales in 2019.

重要的是，雖然商店合理化計劃導致關閉了不再與我們的核心客戶戰略一致的表現不佳的商店，但我們的車隊優化策略使我們能夠建立一個新的前進目標基礎，即全年結束時約500 家商店2023 年。與大流行前相比，我們新的 500 家商店群的構成更加註重直營店。奧特萊斯是我們生產力最高、利潤最高的商店類型。進入 2024 年，我們預計直營店將占我們商店的約 22%，而 2019 年為 14%，約占我們商店銷售額的 30%，而 2019 年為 20%。

Throughout our decade-long fleet optimization initiative, the company has been laser-focused on the significant shifts taking place with respect to demographics. Birth rates have been on a decline for 15 years. And over the last decade, population shifts out of the Northeast and Midwest and into the markets in the Southeast and Southwest have been significant. It is important that our brick-and-mortar stores are positioned in markets with a population to support our product. Prepandemic, 60% of our U.S. stores were in the Northeast, Midwest and West. And entering 2024, that number will be in the low 50% range.

在我們長達十年的機隊優化計劃中，該公司一直專注於人口統計方面發生的重大變化。 15年來，出生率一直在下降。在過去的十年中，人口從東北部和中西部轉移到東南部和西南部市場的情況非常顯著。重要的是，我們的實體店定位於擁有支持我們產品的人口的市場。疫情爆發前，我們 60% 的美國門店位於東北部、中西部和西部。進入 2024 年，這個數字將處於 50% 的低水平。

Additionally, since the pandemic, many of our core millennial customers have taken advantage of work remote capabilities and migrated south and west for a better quality of life.

此外，自疫情爆發以來，我們的許多核心千禧一代客戶都利用了遠程工作能力，向南部和西部遷移，以獲得更好的生活質量。

The data is very clear. Had we not closed them, these underperforming stores would have been an untenable burden on the company. And because we closed them, we are significantly better positioned going forward from a top and bottom line perspective. For the past decade, we have been focused on transforming to a digital-first, digital-dominant retailer because unlike many other omnichannel retailers, digital is our most profitable channel, and our customer clearly prefers shopping for her kids online.

數據非常清楚。如果我們沒有關閉它們，這些業績不佳的商店將成為公司難以承受的負擔。因為我們關閉了它們，所以從營收和利潤的角度來看，我們的未來定位明顯更好。在過去的十年裡，我們一直致力於轉型為數字優先、數字主導的零售商，因為與許多其他全渠道零售商不同，數字是我們最賺錢的渠道，而且我們的客戶顯然更喜歡在網上為她的孩子購物。

Looking at other omnichannel retailers across our peer group, the average digital penetration is approximately 30%. We have an industry-leading digital penetration in excess of 50% and growing in our most profitable channel, which we believe is a significant competitive advantage that now allows us to be more flexible and more profitable versus prepandemic as the millennial and Gen Z moms continue their historic migration to the mass and online channels.

看看我們同行中的其他全渠道零售商，平均數字滲透率約為 30%。我們擁有超過50% 的行業領先的數字滲透率，並且我們最賺錢的渠道正在不斷增長，我們認為這是一個顯著的競爭優勢，隨著千禧一代和Z 世代媽媽們的繼續發展，現在使我們能夠比大流行前更加靈活、更有利可圖他們歷史性地向大眾和在線渠道遷移。

Next, less inventory. Following the pandemic, we experienced a significant spike in input costs, including cotton and supply chain costs. As we have discussed at length, these factors, combined with the challenging external environment, resulted in inflated inventory levels throughout fiscal 2022 and into the first half of 2023. And in response, we have taken several strategic steps with respect to inventory management. We liquidated seasonal inventory in Q4 of 2022 to reduce risk and enter 2023 in a stronger inventory position.

其次，減少庫存。疫情爆發後，我們經歷了投入成本大幅飆升，包括棉花和供應鏈成本。正如我們詳細討論的那樣，這些因素加上充滿挑戰的外部環境，導致 2022 財年和 2023 年上半年的庫存水平過高。為此，我們在庫存管理方面採取了多項戰略步驟。我們在 2022 年第四季度清理了季節性庫存，以降低風險，並以更強勁的庫存狀況進入 2023 年。

During the first 6 months of 2023, we have continued our focus on liquidating our high AUC inventory. And because of those efforts, we are entering the important back half of the year in a much cleaner inventory position, with carryover seasonal inventory down 26% versus last year.

2023 年前 6 個月，我們繼續專注於清算高 AUC 庫存。由於這些努力，我們進入今年下半年的重要時刻，庫存狀況更加清潔，結轉季節性庫存比去年下降了 26%。

In light of the reductions of input costs, combined with the current macro environment, and in support of our transition from a legacy store model into a digital-first model, we have significantly pulled back on our inventory investments for the balance of 2023 and into 2024.

鑑於投入成本的降低，結合當前的宏觀環境，並為了支持我們從傳統商店模式向數字優先模式的轉型，我們大幅縮減了 2023 年剩餘時間和 2023 年的庫存投資。 2024 年。

Finally, based upon the impressive results we have seen in the back half of 2022 with respect to our celebrity and influencer marketing campaigns, we have increased the inventory investments devoted to these campaigns.

最後，基於 2022 年下半年我們在名人和影響者營銷活動方面取得的令人印象深刻的成果，我們增加了專門用於這些活動的庫存投資。

Next, less people. As part of our structural transformation from a legacy store operating model to a digital-first retailer, we recently implemented a planned workforce reduction. This initiative resulted in a 17% reduction of our salaried workforce, representing 181 positions, the substantial majority of which were located at our corporate office. While our prior and current guidance reflect the financial benefit of this reduction, this was an important step that we were able to take as a direct result of our transformation, enabling us to operate our company with less headcount versus prepandemic.

接下來，人就少了。作為我們從傳統商店運營模式向數字優先零售商結構轉型的一部分，我們最近實施了計劃的裁員計劃。這一舉措導致我們的受薪員工減少了 17%，共 181 個職位，其中絕大多數位於我們的公司辦公室。雖然我們之前和當前的指導反映了這種減少所帶來的財務利益，但這是我們能夠採取的重要一步，是我們轉型的直接結果，使我們能夠以比大流行前更少的員工人數來運營我們的公司。

Now let's discuss less expense. We believe the permanent structural efficiencies we have gained by moving away from our legacy store operating model, combined with our strong focus on expense optimization, will enable us to continue to operate in a significantly more effective and efficient manner. A recent example of this is the announcement of our corporate office lease termination. After rightsizing our head count, we can now operate with significantly less space, and we were not willing to accept the above-market rent escalations that were built into our previously -- previous lease. And we are now in the process of determining alternative solutions before the expiration of our reduced lease term, which expires in May of 2024.

現在我們來討論一下減少費用。我們相信，通過擺脫傳統商店運營模式而獲得的永久性結構效率，加上我們對費用優化的高度重視，將使我們能夠繼續以更加有效和高效的方式運營。最近的一個例子是我們公司辦公室租賃終止的公告。在調整了我們的員工人數後，我們現在可以在顯著減少的空間內運營，並且我們不願意接受我們之前的租約中包含的高於市場水平的租金上漲。我們現在正在縮短租賃期限（將於 2024 年 5 月到期）之前確定替代解決方案。

Our expense reduction initiatives will be further bolstered by our ongoing and rapid expansion of our second most profitable business, wholesale, driven by Amazon, which operates at a lower gross margin rate than our retail business, but at a significantly lower SG&A rate than our retail business and is accretive to our operating margins. We anticipate that the 300-plus percent increase in our wholesale business since 2019 will have an approximate 250-basis-point negative impact on our gross margin rates in 2023 versus 2019. However, the minimal fixed costs associated to run that business more than offsets the gross margin loss and is accretive to our operating margins.

在亞馬遜的推動下，我們第二大盈利業務批發業務的持續快速擴張將進一步支持我們的費用削減計劃，該業務的毛利率低於我們的零售業務，但SG&A比率明顯低於我們的零售業務業務並增加我們的營業利潤。我們預計，自2019 年以來，我們的批發業務增長了300% 以上，這將對我們2023 年的毛利率產生約250 個基點的負面影響，與2019 年相比。然而，與運營該業務相關的最低固定成本足以抵消毛利率損失，並增加我們的營業利潤。

Looking ahead to 2024, our wholesale growth is expected to outpace our retail growth. So the dynamic between gross margin and SG&A will continue to positively impact our operating margins.

展望 2024 年，我們的批發增長預計將超過零售增長。因此，毛利率和銷售、一般費用之間的動態將繼續對我們的營業利潤率產生積極影響。

Going forward, we believe the combined effects of these initiatives will enable us to operate the business with a significantly lower permanent fixed expense structure than we were able to do prepandemic, and will provide us with the opportunity to deliver improved profitability with more consistent and sustainable operating margins.

展望未來，我們相信這些舉措的綜合影響將使我們能夠以比大流行前顯著降低的永久固定費用結構來運營業務，並將為我們提供機會以更加一致和可持續的方式提高盈利能力營業利潤率。

Finally, less debt and more operating margin. While we recently announced the expansion of our revolving credit facility, which strengthens our financial position, supports our seasonal working capital needs and reduces downside risk, the combination of our reduced store fleet, decreased inventory investments, cost savings initiatives and the expected return to profitability significantly provides us the opportunity to generate meaningful free cash flow in the back half of 2023.

最後，債務減少，營業利潤增加。雖然我們最近宣布擴大循環信貸額度，以增強我們的財務狀況，支持我們的季節性營運資金需求並降低下行風險，但結合我們減少的商店數量、減少的庫存投資、成本節約舉措和預期的盈利回報為我們提供了在2023 年下半年產生有意義的自由現金流的機會。

We expect to utilize this free cash flow to pay down debt in the back half, and we continue to plan to have lower debt levels by over $100 million at the end of 2023 versus 2022.

我們預計將利用這些自由現金流來償還下半年的債務，並且我們繼續計劃到 2023 年底將債務水平比 2022 年降低超過 1 億美元。

As we enter 2024, we believe the improved balance sheet positioning will help us produce more sustainable operating margins and more consistent free cash flow throughout 2024 and beyond. As the company has previously indicated, the first 6 months of 2023 were negatively impacted by several temporary headwinds, most notably cotton. These high input costs embedded in our spring and summer fashion inventory in the first half of 2023 have now largely been liquidated. And as we have previously indicated, we expect significant gross margin and operating margin expansion in the back half of 2023.

進入 2024 年，我們相信改善的資產負債表定位將幫助我們在 2024 年及以後創造更可持續的營業利潤率和更穩定的自由現金流。正如該公司此前表示的那樣，2023 年前 6 個月受到了一些暫時性不利因素的負面影響，其中最明顯的是棉花。我們 2023 年上半年春夏時裝庫存中包含的這些高額投入成本現已大部分得到清算。正如我們之前指出的，我們預計 2023 年下半年毛利率和營業利潤率將大幅增長。

Now let me take you through our outlook. The company is providing guidance for the back half of 2023 and for the third quarter of 2023, and is narrowing its previously provided guidance for the full year. For the back half of 2023, the company continues to expect to deliver double-digit operating margins, driven by strong product offerings, decreased input costs embedded in inventory, the benefit of reduced inventory levels and strong expense discipline.

現在讓我帶您了解一下我們的前景。該公司正在提供 2023 年下半年和 2023 年第三季度的指導，並縮小了之前提供的全年指導範圍。到 2023 年下半年，在強勁的產品供應、庫存投入成本降低、庫存水平降低的好處以及嚴格的費用控制的推動下，該公司繼續預計將實現兩位數的營業利潤率。

Net sales for the combined third and fourth quarters are expected to be in the range of $910 million to $920 million, representing a decrease in the mid-single-digit percentage range as compared to the prior fiscal year. Adjusted operating income for the 6-month period is expected to be approximately 10% of net sales. Interest for the combined 6-month period is expected to be approximately $13 million, reflecting higher average borrowings than the prior year and the impact of increased rates due to the increase in interest rates over the past year.

第三季度和第四季度合併後的淨銷售額預計將在 9.1 億美元至 9.2 億美元之間，與上一財年相比，出現中個位數百分比下降。 6 個月期間調整後的營業收入預計約為淨銷售額的 10%。 6 個月期間的利息預計約為 1,300 萬美元，反映出平均借款高於上年以及去年利率上升導致利率上升的影響。

Our effective tax rate is expected to be approximately 20% to 21%. Adjusted net earnings per diluted share are expected to be in the range of $5 to $5.25.

我們的有效稅率預計約為 20% 至 21%。調整後每股攤薄淨利潤預計在 5 美元至 5.25 美元之間。

For the third quarter of fiscal 2023, the company expects the following: Net sales are expected to be in the range of $470 million to $475 million, representing an approximate 7% decrease as compared to the prior year third quarter. Adjusted operating profit for the third quarter is expected to be approximately 13.5% of net sales. Interest expense for the third quarter is expected to be approximately $7 million to $7.5 million, again reflecting higher average borrowings and the impact of increased rates due to the increase in interest rates over the past year.

對於2023財年第三季度，該公司預計：淨銷售額預計在4.7億美元至4.75億美元之間，比去年第三季度下降約7%。第三季度調整後營業利潤預計約為淨銷售額的13.5%。第三季度的利息支出預計約為 700 萬至 750 萬美元，再次反映了平均借款的增加以及由於過去一年利率上升而導致利率上升的影響。

Our effective tax rate for the third quarter is expected to be approximately 20% to 21%. Adjusted net earnings per diluted share for the third quarter are expected to be in the range of $3.55 to $3.65. We anticipate that Q3 2023 gross margin rate will increase by approximately 200 to 300 basis points versus last year, reflecting the anticipated decrease in input costs on goods expected to be sold during the quarter, partially offset by a decrease of approximately 100 basis points due to the significant growth of our wholesale business, which operates at lower gross margins.

我們第三季度的有效稅率預計約為20%至21%。第三季度調整後每股攤薄淨利潤預計在 3.55 美元至 3.65 美元之間。我們預計2023 年第三季度的毛利率將比去年增加約200 至300 個基點，反映出預計本季度銷售商品的投入成本預計會下降，但部分被由於以下原因導致的約100 個基點的下降所抵消我們的批發業務顯著增長，但毛利率較低。

SG&A expenses are expected to be down slightly versus last year, reflecting reductions in store payroll due to lower store count, reduced home office payroll and other expense rationalization initiatives, partially offset by planned increases in marketing expense and an increase in incentive compensation.

SG&A 費用預計將比去年略有下降，反映出由於商店數量減少、家庭辦公室工資減少和其他費用合理化舉措導致商店工資減少，但計劃中的營銷費用增加和激勵薪酬增加部分抵消了這一影響。

At the end of the third quarter, inventory is expected to be down in the low-double-digit percentage range versus the prior year third quarter.

到第三季度末，庫存預計將比去年第三季度低兩位數百分比下降。

To provide some color on the fourth quarter, we expect the fourth quarter SG&A dollars to be down significantly versus last year and will be down versus Q3, which reflects the impact of our expense reduction initiatives. We expect our fourth quarter gross profit margin will expand by 1,300 to 1,400 basis points compared to last year. Our gross margin projections take into account the significant expansion of our wholesale business, which we estimate will negatively impact our Q4 gross margin rate by more than 100 basis points versus last year's fourth quarter. But as we previously discussed, this business operates at lower SG&A and is accretive to our operating margin.

為了給第四季度提供一些色彩，我們預計第四季度的銷售及管理費用將比去年大幅下降，並且比第三季度也會下降，這反映了我們削減開支計劃的影響。我們預計第四季度毛利率將比去年擴大 1,300 至 1,400 個基點。我們的毛利率預測考慮到了批發業務的大幅擴張，我們估計這將對我們第四季度的毛利率產生比去年第四季度超過 100 個基點的負面影響。但正如我們之前所討論的，該業務的銷售費用及行政管理費用較低，並且可以增加我們的營業利潤。

In addition, we expect our margins will also be negatively impacted by the continuation of the challenging macroeconomic environment as our core customers are expected to continue to feel the impact of inflation for the remainder of the year.

此外，我們預計我們的利潤率也將受到持續充滿挑戰的宏觀經濟環境的負面影響，因為我們的核心客戶預計將在今年剩餘時間內繼續受到通脹的影響。

The company is narrowing its previously provided guidance for the full year 2023, and now expects net sales to be in the range of $1.575 billion to $1.585 billion, adjusted operating profit ranging from 2.7% to 3% of net sales, and net earnings per diluted share expected to be in the range of $1 to $1.25 per share. These projections include the impact of the 53rd week in 2023 based upon our retail calendar. This week occurs during a low-volume, nonpeak clearance period, and as a result, is expected to have a very modest impact on revenues and an insignificant impact on operating results.

該公司正在縮小之前提供的2023年全年指引，目前預計淨銷售額將在15.75億美元至15.85億美元之間，調整後營業利潤將占淨銷售額的2.7%至3%，攤薄後淨利潤將在2.7%至3%之間。預計每股價格在 1 美元至 1.25 美元之間。這些預測包括根據我們的零售日曆對 2023 年第 53 週的影響。本周正值成交量低、非高峰清倉期，因此預計對收入的影響非常小，對運營業績的影響微乎其微。

We have also significantly reduced our planned capital expenditures for the full year, which are now expected to be in the range of $20 million to $25 million, primarily to support our digital initiatives and the enhancement of our fulfillment capabilities. We anticipate closing 80 to 100 stores as part of our ongoing fleet optimization initiative, with the bulk of the closures happening at the end of 2023, leaving us with approximately 500 stores.

我們還大幅減少了全年計劃的資本支出，目前預計在 2000 萬美元至 2500 萬美元之間，主要用於支持我們的數字計劃和增強我們的履行能力。作為我們正在進行的車隊優化計劃的一部分，我們預計將關閉 80 到 100 家商店，其中大部分關閉發生在 2023 年底，這樣我們就只剩下大約 500 家商店。

Thank you, and we will now open the call to your questions.

謝謝您，我們現在將開始回答您的問題。

(Operator Instructions) Our first question comes from Jim Chartier with Monness, Crespi and Hardt.

（操作員說明）我們的第一個問題來自 Jim Chartier 以及 Monness、Crespi 和 Hardt。

I just want to talk about the guidance for a second. So it looks like, by my math, that at the midpoint, your operating income guidance is actually up a little bit from before. So can you just talk about what changed in terms of your outlook for interest expense or the tax rate?

我只想談談指導。因此，根據我的計算，在中點，您的營業收入指導實際上比之前有所上升。那麼您能談談您對利息支出或稅率的展望發生了什麼變化嗎？

Yes. Jim, I think you're generally correct. I think in terms of our operating profit guidance, we do feel strongly about, obviously, the 10% operating margin that we continue to believe that we'll be able to achieve in the back half of the year, driven by our margin expectations on a gross margin level, which, as we talked in my prepared comments, we did experience some pull forward of some clearance merchandise into July, which will benefit us versus our expectations in the back half of the year. And then obviously, our cost controls and initiatives that we continue to accelerate are helping us from an SG&A perspective, which are all helping us to improve operating profits slightly versus our previous guidance.

是的。吉姆，我認為你基本上是正確的。我認為，就我們的營業利潤指導而言，我們確實對10% 的營業利潤率有強烈的感覺，顯然，我們仍然相信，在我們的利潤率預期的推動下，我們將能夠在今年下半年實現這一目標。毛利率水平，正如我們在我準備好的評論中談到的那樣，我們確實經歷了一些清倉商品提前到 7 月份的情況，這將使我們受益於我們今年下半年的預期。顯然，我們繼續加速的成本控制和舉措從銷售、管理及行政費用的角度來看正在幫助我們，這都有助於我們比之前的指導略有提高營業利潤。

We did experience an increase in interest rate and interest costs associated with borrowings. So that partially offset some of those increases. So that's what you're seeing in terms of the bottom line result. I think tax rate is generally where we would have expected. But essentially, you're seeing some of the operating profit improvements that we've been able to project slightly offset by increased interest rate due to higher borrowings and higher market-based rates.

我們確實經歷了與借款相關的利率和利息成本的增加。因此，這部分抵消了其中的一些增長。這就是您所看到的底線結果。我認為稅率總體上是我們預期的。但從本質上講，您會看到一些營業利潤的改善，我們預計這些改善會被由於借款增加和市場利率上升而導致的利率上升所略微抵消。

Great. And then if I could ask a follow-up. Just -- you've moved up the marketing campaign by a month for back-to-school. Others have kind of talked about the back-to-school extending into September, late this year. How are you thinking about the back-to-school season? Are you continuing to invest in marketing in August and September at the same rate as last year? And then just overall, are you pleased with kind of back-to-school in August to date?

偉大的。然後我是否可以詢問後續情況。只是——您將返校營銷活動提前了一個月。其他人也談到了今年晚些時候的返校活動將持續到九月。您如何看待返校季？八月和九月您是否會繼續以與去年相同的速度進行營銷投資？總的來說，您對八月份迄今為止的返校情況感到滿意嗎？

Yes. Jim, it's Jane. I think clearly, based on our prepared remarks, we're very excited about back-to-school. We launched early. We were first-to-market, and I think that you can tell through our results, particularly digital, that, that was a successful strategy. Just to refresh everyone, the lion's share of the back-to-school business happens between [$7.15] and [$8.15]. So 60% of our back-to-school business is between that time period. And I'm sure it's similar for others. I'm always a little surprised when people talk about extending back-to-school to September. We don't have a back-to-college business. But considering all the kids are pretty much already back on campus, I would assume that business is heavily front-loaded as it is for us. And when you think about our business at TCP, by 8/28, which is 1.5 weeks from now, 80% of our kids in our markets are back in school. So like I said, August is really where this happens for us. And August, as you all know who follow us, is an outsized month and represents usually historically about 40% of the quarter.

是的。吉姆，是簡。我清楚地認為，根據我們準備好的發言，我們對重返校園感到非常興奮。我們很早就推出了。我們是第一個進入市場的公司，我認為您可以通過我們的結果（尤其是數字結果）看出，這是一個成功的策略。為了讓大家耳目一新，返校業務的大部分發生在 [7.15 美元] 到 [8.15 美元] 之間。因此，我們 60% 的返校業務都發生在這段時間之間。我確信其他人也有類似的情況。當人們談論將返校時間延長到九月時，我總是感到有點驚訝。我們沒有重返大學的業務。但考慮到所有的孩子幾乎都已經回到了校園，我認為業務對於我們來說是很重要的。當你想到我們 TCP 的業務時，到 8 月 28 日，也就是 1.5 週後，我們市場上 80% 的孩子都回到了學校。就像我說的，八月確實是我們發生這種情況的時候。關注我們的人都知道，8 月是一個非常大的月份，歷史上通常佔該季度的 40% 左右。

And so what's happening now is really the big businesses in uniform, denim, graphics, that's what's really driving the sales in that 07/15 to 09/01 time period, if you will. Fashion business has been very strong for us in stores as well as on our digital channels. So we're happy to see that. And also Halloween has been -- we always launched that around 07/01, but that has been particularly strong for us. And I think as Meagan mentioned in her prepared remarks, our digital shopper shops earlier than our store shopper. And so we're seeing really positive response to that. And we'll continue to spend on marketing, as we discussed in our prepared remarks through the balance of the season.

所以現在發生的事情實際上是製服、牛仔布、圖案方面的大企業，如果你願意的話，這才是真正推動 2015 年 7 月到 2001 年 9 月期間銷售的因素。我們的時尚業務在商店和數字渠道上都非常強勁。所以我們很高興看到這一點。還有萬聖節——我們總是在 07/01 左右推出萬聖節，但這對我們來說特別強烈。我認為正如梅根在她準備好的講話中提到的那樣，我們的數字購物者比實體店購物者更早購物。所以我們看到了非常積極的回應。正如我們在本賽季剩餘時間準備好的評論中所討論的那樣，我們將繼續在營銷上投入資金。

But I just want to make it clear that, as we leave August behind, we quickly move into selling seasonal products in the start of holiday and really leave back-to-school behind.

但我只是想明確表示，當我們告別八月時，我們很快就會在假期開始時開始銷售季節性產品，真正告別返校季。

We'll take our next question from Jeff Lick with B. Riley Financial.

我們將回答 B. Riley Financial 的 Jeff Lick 提出的下一個問題。

Congrats on a great quarter. By my math here, if I use Sheamus' data with U.S. and Canada, it appears your digital business was down mid-single digits. Obviously, you said it was up for June, July, which implies a pretty significant acceleration. I'm just wondering, I'm assuming your guidance implies digital will be up for the year -- or for -- up for the second half. And I'm just kind of wondering, do you -- are there things with regards to the marketing and that you're seeing that kind of give you even more confidence in that guidance, the digital guidance?

恭喜您度過了一個出色的季度。根據我的數學計算，如果我使用希莫斯在美國和加拿大的數據，您的數字業務似乎下降了中個位數。顯然，你說的是六月、七月，這意味著相當顯著的加速。我只是想知道，我假設您的指導意味著數字化將在今年或下半年上升。我只是想知道，您是否 - 是否存在與營銷有關的事情，並且您所看到的這些事情讓您對數字指南更有信心？

Yes. Jeff, it's Sheamus. I think, first, from a trend perspective, I think generally in the ballpark, our digital business was -- in Q2 was in the low-single-digit percentage range. And as you said, and as we talked about in our prepared remarks, that was an improving trend throughout the quarter where we saw that flip to positive in the last 2 months of the quarter. I think as we look at our guidance and our expectations for the back half of the year, I think we have some different perspective by channel, and it's probably best to understand it by looking at the different channels.

是的。傑夫，我是希莫斯。我認為，首先，從趨勢的角度來看，我認為總體而言，我們的數字業務在第二季度處於較低的個位數百分比範圍內。正如您所說，正如我們在準備好的發言中所討論的那樣，整個季度的趨勢都在改善，我們看到這種趨勢在本季度的最後 2 個月轉為積極。我認為，當我們審視下半年的指導和預期時，我認為我們對不同渠道有一些不同的看法，最好通過觀察不同的渠道來理解它。

I think, first, as we look at the wholesale business, as we've discussed and commented on a number of occasions, we expect the wholesale business to be up significantly in the back half of the year, contributing to positive results on the top line and helping us, obviously, from a comp perspective. Secondarily, from a brick-and-mortar standpoint, given the macro pressures, coupled with continued expectations on our part for declines in mall traffic, we do expect the brick-and-mortar business to continue to be challenged during the back half of the year. And I'm really not anticipating any improvement in that trend at all.

我認為，首先，當我們看批發業務時，正如我們在多個場合討論和評論的那樣，我們預計批發業務將在今年下半年大幅增長，為頂部帶來積極的業績顯然，從補償的角度來看，這對我們有幫助。其次，從實體角度來看，考慮到宏觀壓力，加上我們對商場客流量下降的持續預期，我們預計下半年實體業務將繼續面臨挑戰。年。我真的不期望這種趨勢有任何改善。

And then finally, in the back half of the year, to the point of your question, with respect to e-commerce, we are expecting a slight improvement in trend due to a combination of factors. Obviously, we've experienced positive traffic trends based upon the success of our marketing strategies. We're not anticipating that those trends will dramatically improve from where we are now, but they are positive. So we're still anticipating the success of those marketing investments as we move into the back half of the year.

最後，在今年下半年，就你所問的問題而言，由於多種因素的綜合作用，我們預計電子商務的趨勢會略有改善。顯然，基於我們營銷策略的成功，我們經歷了積極的流量趨勢。我們預計這些趨勢不會比現在的情況顯著改善，但它們是積極的。因此，當我們進入今年下半年時，我們仍然預計這些營銷投資會取得成功。

And then I think we see some opportunity for increased or improved conversion as we move into the back half of the year as we're better positioned in certain key items for the holiday season. And those key items importantly are further supported by some of our marketing initiatives. So I think that gives us an opportunity in the back half of the year relative to last year to see an even more improved trend in the e-commerce business versus what we saw in Q2.

然後，我認為，隨著進入下半年，我們看到了一些增加或改善轉化的機會，因為我們在假日季節的某些關鍵項目上處於更好的位置。重要的是，這些關鍵項目得到了我們的一些營銷舉措的進一步支持。因此，我認為，與去年相比，這使我們有機會在今年下半年看到電子商務業務的趨勢與第二季度相比更加改善。

I think from an AUR perspective, we're anticipating still a challenging environment and not really anticipating an improvement in the trend in terms of AUR. But overall, our digital business is expected to improve slightly based upon that improvement in conversion and that continued success of the marketing investment in terms of driving traffic.

我認為從 AUR 的角度來看，我們預計仍然是一個充滿挑戰的環境，並且並沒有真正預計 AUR 的趨勢會有所改善。但總體而言，基於轉化率的提高以及營銷投資在推動流量方面的持續成功，我們的數字業務預計將略有改善。

Our next question comes from Dana Telsey with Telsey Group.

我們的下一個問題來自 Telsey Group 的 Dana Telsey。

Nice to see the progress. As you think about the business model shifting to digital and then certainly, every indication as it becomes a more efficient business model, how do you think of the expense structure going forward? And does it get leaner than what it is given, obviously, the balancing act of marketing investment driving customer growth and transaction, but also the expense structure internally?

很高興看到進展。當您考慮商業模式轉向數字化，當然，每一個跡像都表明它成為一種更高效的商業模式時，您如何看待未來的費用結構？它是否比它所給出的更精簡，顯然，營銷投資驅動客戶增長和交易的平衡行為，以及內部的費用結構？

And then, Jane, you just announced the hiring of Mary Beth on the Chief Merchant side. What do you see that opportunity in enhancing the merchandise assortment, whether through The Children's Place brand or the other brands?

然後，簡，您剛剛宣布聘請瑪麗·貝絲擔任首席商人。無論是通過 The Children's Place 品牌還是其他品牌，您認為增強商品種類的機會是什麼？

Sure. Mary Beth is a very seasoned merchant and has worked in a lot of different channels in a lot of different businesses. And so she's only been here a couple of weeks, but she has immediately hit the ground running, which is not surprising, as I had mentioned in the press release. I've worked with Mary Beth in the past so I think she's going to bring a level of discipline and a level of urgency around the opportunities in the brands, and to your point, not just TCP, but how do we continue to get the momentum going in Gymboree, how do we break through on Sugar & Jade and really make that business more important as we look to 2024 and beyond. And like I said, she's worked on a lot of different businesses. So I think that she can look across the brands and think about incrementality.

當然。瑪麗·貝絲（Mary Beth）是一位經驗豐富的商人，曾在許多不同的企業的許多不同渠道工作過。因此，她來到這裡才幾週，但她已經立即開始工作，這並不奇怪，正如我在新聞稿中提到的那樣。我過去曾與 Mary Beth 合作過，所以我認為她會圍繞品牌機會帶來一定程度的紀律和緊迫感，就你的觀點而言，不僅僅是 TCP，而是我們如何繼續獲得隨著金寶貝( Gymboree) 的發展勢頭，我們如何在Sugar & Jade 上取得突破，並在展望2024 年及以後時真正使該業務變得更加重要。就像我說的，她從事過很多不同的業務。所以我認為她可以審視各個品牌並思考增量。

I think what it also does is it really frees Meagan up to really focus her energies on marketing and on our wholesale business directly mostly from Amazon. So having Meagan be able to spend a lot more focused time on growing the Amazon business and the potential offshoots of that Amazon business, be it international or what have you, and then also to see what Meagan and her team have been able to do on the marketing front, it's just absolutely incredible when you think about where we were prepandemic and where we are now. And you look at just things like our digital business comping positive in June and July and double-digit traffic increases. We haven't heard a lot of reports so far, but from the ones we have, we are certainly a significant outlier in how strong our digital results are.

我認為它的作用還在於，它真正讓梅根真正將精力集中在營銷和直接來自亞馬遜的批發業務上。因此，讓梅根能夠花更多的時間專注於發展亞馬遜業務和亞馬遜業務的潛在分支，無論是國際業務還是其他業務，然後看看梅根和她的團隊在這方面能夠做些什麼在營銷方面，當你想想我們在大流行前的情況和現在的情況時，這絕對是令人難以置信的。你會看到我們的數字業務在 6 月和 7 月取得積極進展，流量出現兩位數增長。到目前為止，我們還沒有聽到很多報告，但從我們掌握的報告來看，我們的數字化成果無疑是一個顯著的異常值。

And obviously, that's where our eggs are in the basket and continue to move on that. So I think that, that will really free Meagan up for that as well. And the rest of it, I'll turn it over to Sheamus.

顯然，這就是我們的雞蛋放在籃子裡的地方，並繼續前進。所以我認為，這也能讓梅根真正解放出來。剩下的事情，我會把它交給希莫斯。

Yes. So in terms of the first part of your question, as far as our digital acceleration, we do see the opportunity to have a permanent reduction in our expense structure. As I commented and Jane commented in our prepared remarks, in terms of operating efficiencies, we believe that the digital acceleration will enable us to obviously, as we commented, have less stores, less inventory, less people, less expense, less debt, less interest as a result of that debt. So there's a whole host of efficiencies.

是的。因此，就您問題的第一部分而言，就我們的數字加速而言，我們確實看到了永久減少費用結構的機會。正如我和簡在我們準備好的發言中評論的那樣，就運營效率而言，我們相信數字化加速顯然將使我們能夠減少商店、減少庫存、減少人員、減少開支、減少債務、減少運營成本。該債務產生的利息。因此，效率得到了很大提高。

On the expense side, we've obviously executed a number of initiatives this year, which are reducing expenses. We've commented in our guidance in terms of expectations for expense reductions relative to last year. And those are not a onetime thing that are temporary benefits. We believe that's a resetting of the expense structure as we shift to a more digital business, as we layer in more wholesale, which, as I commented earlier, comes with less SG&A expense. And I think it's also important to note, within that SG&A expense, as we've talked on numerous occasions, we're also investing in marketing.

在費用方面，我們今年顯然執行了許多減少費用的舉措。我們在指導中評論了與去年相比費用減少的預期。這些並不是一次性的事情，而是暫時的好處。我們認為，隨著我們轉向更加數字化的業務，隨著我們進行更多的批發業務，這是對費用結構的重置，正如我之前評論的那樣，這會帶來更少的銷售、管理和行政費用。我認為還需要注意的是，正如我們在很多場合談到的那樣，在 SG&A 費用中，我們也在營銷方面進行了投資。

So we're able to achieve SG&A expense reductions despite the fact that we're making investments in marketing to drive our digital business, which are extremely important to our growth initiatives, but we're, in essence, able to self-fund those marketing investments with the restructuring of our business and the expense reductions that we see across the business. And some of that hits in SG&A expense. Some of it is also coming through occupancy cost reductions, as Meagan talked about in her comments, where we're shifting from billboards or nameplates on brick-and-mortar locations to more digital marketing initiatives.

因此，儘管我們在營銷方面進行投資以推動我們的數字業務（這對我們的增長計劃極其重要），但我們仍能夠實現 SG&A 費用的削減，但從本質上講，我們能夠自籌資金通過業務重組和整個業務的費用削減來進行營銷投資。其中一些影響到銷售、管理及行政費用。其中一些還來自入住成本的降低，正如梅根在她的評論中談到的那樣，我們正在從實體店的廣告牌或銘牌轉向更多的數字營銷舉措。

That digital marketing ends up in SG&A expense, where some of that occupancy cost was actually in our margin structure. So I think we're certainly getting more efficient, more effective with our expense structure, and that's not a temporary benefit. That's an ongoing benefit that will cascade into 2024 and beyond, enabling us to have more sustainable growth and more sustainable increases in terms of operating profits.

數字營銷最終會產生SG&A費用，其中一些佔用成本實際上包含在我們的利潤結構中。因此，我認為我們的費用結構肯定會變得更加高效、更加有效，而且這不是暫時的好處。這是一項持續的效益，將持續到 2024 年及以後，使我們能夠實現更可持續的增長和營業利潤的更可持續增長。

We will take our next question from Jay Sole with UBS.

我們將回答瑞銀傑伊·索爾 (Jay Sole) 提出的下一個問題。

Great. Jane, I want to ask just about third quarter versus fourth quarter and just how the business has evolved because the guidance for third quarter sales looks like it's implying sales for third quarter to be a lot bigger than they will be for fourth quarter. Although if you go pre-pandemic in the past, fourth quarter was always bigger than third quarter given it's holiday. Is the change just around the wholesale business and its growth? Or is there something else going on that would really make structurally third quarter bigger now? And then if you kind of maybe just talk about Gymboree, and as that business grows, how that should impact fourth quarter, that would be super helpful.

偉大的。簡，我想問一下第三季度與第四季度的情況，以及業務的發展情況，因為第三季度銷售的指導看起來意味著第三季度的銷售額將比第四季度大得多。儘管如果你回顧過去的大流行前，第四季度總是比第三季度大，因為它是假期。變化只是圍繞批發業務及其增長嗎？或者是否還有其他事情正在發生，確實會讓第三季度的結構性變得更大？然後，如果您只是談論金寶貝，隨著該業務的增長，這將如何影響第四季度，那將非常有幫助。

Yes. I'll turn it over to Sheamus for the first part, and then I'll take it back for Gymboree.

是的。第一部分我會把它交給 Sheamus，然後我會把它拿回來給 Gymboree。

Yes. I think as Jane said earlier, in terms of the importance of back-to-school, it is a critically important time period for us where we do see a significant amount of revenue uptick in Q3. So that has definitely driven more revenue and a disproportionate amount of revenue into Q3. So it's a critically important quarter for us because of that. I think that, that's what you're seeing in our expectations in terms of the performance split between the quarter.

是的。我認為正如簡之前所說，就返校的重要性而言，這對我們來說是一個至關重要的時期，我們確實看到第三季度的收入大幅增長。因此，這肯定會在第三季度帶來更多的收入和不成比例的收入。因此，這對我們來說是一個至關重要的季度。我認為，這就是您在我們對本季度業績分配的預期中看到的情況。

And then from a Gymboree perspective, I can take that part of the question. Gymboree, we're planning when we think about Q3 into Q4, Gymboree, we've talked about before, is a very holiday-centric business. So we're going to continue to see really exciting growth from the Gymboree brand as we head into Q4. And a lot of that is going to be surrounded by an incredible marketing campaign. We had announced Mandy Moore. We've continued to see really positive success with her throughout the year. And really where it kicks into gear as the tail end of Q3 heading into Q4 as we bring in our expanded holiday assortment. This is where we had a lot of opportunity last year where we saw very early selling. We oversold our inventory so when we head into December, we have a lot of opportunity in the November, December time period. So we're very optimistic about the continued growth of Gymboree, especially as we kick into the key holiday selling time period.

然後從金寶貝的角度來看，我可以回答這部分問題。 Gymboree，當我們考慮第三季度到第四季度時，我們正在計劃，我們之前談到過，金寶貝是一個非常以假期為中心的業務。因此，進入第四季度，我們將繼續看到金寶貝品牌真正令人興奮的增長。其中很多都將被令人難以置信的營銷活動所包圍。我們宣布了曼迪·摩爾的消息。在這一年裡，我們繼續看到她取得了真正積極的成功。隨著第三季度末進入第四季度，隨著我們推出擴大的假日品種，它真正開始發揮作用。這是我們去年有很多機會的地方，我們看到了很早的銷售。我們超賣了我們的庫存，因此當我們進入 12 月時，我們在 11 月、12 月期間有很多機會。因此，我們對金寶貝的持續增長非常樂觀，尤其是在我們進入關鍵的假日銷售時間段之際。

I think the last thing I would just add to the first part of that, as stores have become less penetration for us, I think that in earlier years, when stores were a higher penetration, I think they do have a slightly better performance relative between Q3 and Q4 because of some of the events and a longer, a longer time period. But as we've shifted to more digital, we do see a little bit more volume in Q3 versus Q4.

我想我要在第一部分中添加的最後一件事是，由於商店對我們的滲透率越來越低，我認為在早些年，當商店的滲透率較高時，我認為相對於Q3和Q4因為一些事件而變得更長、時間週期更長。但隨著我們轉向更加數字化，我們確實看到第三季度的銷量比第四季度有所增加。

Thank you for joining us today. If you have further questions, please contact investor relations at (201) 558-2400, extension 14500. You may now disconnect your lines.

感謝您今天加入我們。如果您還有其他疑問，請聯繫投資者關係部：(201) 558-2400，分機號 14500。您現在可以斷開線路。