Canadian Tire Corporation, Limited

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 retail comparable sales were up 0.7% overall. Excluding Petroleum, gross margin was 35.1%, up 33 basis points, retail SG&A was $10 million lower, SG&A as a percentage of revenue was 23.3%, 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. On the bank side, GAAR grew 4.2%, aging was 3.3%, the net write-off rate was around 7.2%, the allowance was $935 million, and the allowance rate was 11.8%. Management expects Q3 and full-year 2026 growth to continue on a 52-week basis, with some moderation at SportChek as it laps prior-year events. CapEx is now expected to be $450 million to $500 million in 2026, and the full-year retail gross margin target remains 35% plus.

Greg Hicks framed the quarter as evidence that Canadian Tire can keep performing while transforming. He emphasized that the company is using AI pricing, sharper merchandising, loyalty, and digital harmonization to win in a value-driven market, and said the business is adding new assortments and playing more deliberately around customer occasions like back-to-school and holiday. His tone was upbeat and strategic, with repeated references to True North, enterprise-wide integration, and long-term omnichannel advantage.

Darren Myers said the quarter reflected disciplined execution against demand headwinds. He highlighted retail gross margin of 35.1% excluding Petroleum, retail SG&A down $10 million, stable SG&A rate at 23.3%, retail IBT of $201 million, and ROIC of 11.1%; on the financial services side he pointed to 4.2% GAAR growth, a 7.2% net write-off rate, a $935 million allowance, and SG&A trending near 28% as planned. He also said 30 store refresh projects were completed in the first half, expects more than double that by year-end, and raised 2026 CapEx guidance to $450 million-$500 million because of timing shifts and tighter capital discipline.

Analysts pressed management on eCommerce growth, free ship-to-home economics, pricing gaps versus competitors, the rise in eCTM issuance, the bank’s credit risk outlook, and whether lower CapEx is structural. Management said eCommerce growth was broad-based, with comp eCommerce sales up 12% and CTR up 14%, driven by free shipping, click-and-collect, and about 12,000 online-only items; it also said the free-shipping offer is still being tested but is producing higher conversion and almost double the AOV versus bricks-and-mortar. On the bank, management said insolvencies have not materially changed risk metrics, payment behavior remains stable, and the allowance is adequate.