Canadian Tire Corporation, Limited

Q2 diluted normalized EPS was $3.94, up 10% year over year. Excluding Petroleum, Retail sales were up 2.5%, Retail revenue was down 1.1%, and overall comparable sales were up 0.7%; SportChek comps rose 8%, Mark’s comps rose 4.2%, and CTR comps fell 0.8%. Excluding Petroleum, gross margin was 35.1%, up 33 basis points. Retail SG&A was $10 million lower year over year, Retail IBT was up 1.2% to $201 million, normalized retail EBITDA increased 2.2% to $498 million, and Retail ROIC was 11.1%, up 80 basis points. Financial Services GAAR grew 4.2%, the net write-off rate was around 7.2%, the allowance was unchanged at $935 million, and the allowance rate was 11.8%. For 2026, CapEx is now expected to be $450 million to $500 million, and the company still expects full-year retail gross margin to be 35% plus despite some Q3 headwinds from fuel surcharges and targeted investments.

Greg Hicks framed the quarter as one where the business performed despite poor weather and soft sentiment, with CTR pressured but Mark’s and SportChek offsetting the drag. His tone was confident and increasingly strategic, emphasizing True North, AI-driven pricing, loyalty, digital harmonization, and ‘customer occasion’ planning as the core of the next phase. He said the company is building a longer-term omnichannel advantage and sees meaningful runway in back-to-school, holiday, and cross-banner shopping.

Darren Myers focused on execution, noting normalized EPS of $3.94, Retail IBT of $201 million, retail EBITDA of $498 million, and gross margin of 35.1% excluding Petroleum. He said SG&A discipline was solid, with retail SG&A down $10 million and the SG&A rate stable at 23.3%, while Financial Services SG&A is expected to stay around 28% in the second half as investments continue. On capital allocation, he highlighted $85 million of buybacks in Q2, 30 store refreshes completed in the first half, a year-end refresh expectation of more than double that, and a lowered 2026 CapEx guide of $450 million to $500 million due mainly to timing and discipline.

Analysts focused on the new customer-occasion strategy, eCommerce growth, margin trends, CapEx, eCTM issuance, and bank risk. Management said the ‘lighthouse’ approach is a modernized form of category management using customer data to identify where the company has a right to win, and cited early examples like wrapping paper, Chromebooks, and dorm products. On eCommerce, management said growth was broad-based, with comp eCommerce sales up 12% and CTR up 14%, helped by free shipping, buy online pick up in store, and roughly 12,000 online-only items. On the bank, management said insolvencies have risen but payment behavior and risk metrics remain stable, the allowance is adequate, and profitability is at an inflection point even as SG&A stays elevated for growth and compliance.