Canadian Tire Corporation, Limited

Diluted normalized EPS was $3.94, up 10% year over year. Retail sales excluding Petroleum increased 2.5%, while Retail revenue declined 1.1%; overall comparable sales were up 0.7%. SportChek comparable sales increased 8.0% and Mark’s comparable sales increased 4.2%, while CTR comparable sales declined 0.8% and CTR revenue fell 3.5%. Gross margin excluding Petroleum was 35.1%, up 33 basis points year over year. Retail SG&A was $10 million lower year over year and SG&A as a percentage of revenue excluding Petroleum was 23.3%. Retail IBT increased 1.2% to $201 million, normalized retail EBITDA rose 2.2% to $498 million, and Retail ROIC improved to 11.1%. In Financial Services, GAAR grew 4.2%, aging was flat year over year at 3.3%, net write-offs were about 7.2%, and the allowance remained $935 million with an 11.8% allowance rate. Management said full-year gross margin remains on track for a 35%+ North Star target. They now expect 2026 CapEx to be $450 million to $500 million, below the original plan of 70 store refresh projects, with 30 completed in the first half and more than double that expected by year-end. Q3 should see some SG&A dollar growth from timing shifts, but management expects margin discipline to hold and early Q3 sales to improve as summer weather arrives.

Greg Hicks framed Q2 as another quarter where the company had to fight weather and cautious consumer sentiment, but still delivered by leaning on value, loyalty and execution. He emphasized that the business is “performing while transforming,” with AI-driven pricing, loyalty partnerships, digital harmonization and a new customer-occasion strategy through MOSaiC and True North. His tone was constructive and confident, especially around long-term omnichannel growth and new opportunities in back-to-school and holiday.

Darren Myers focused on the mechanics of the quarter: EPS of $3.94, retail sales up excluding Petroleum, gross margin of 35.1% excluding Petroleum, Retail IBT of $201 million and normalized retail EBITDA of $498 million. He highlighted cost discipline, including $10 million lower Retail SG&A and a stable 23.3% SG&A rate excluding Petroleum, while noting Financial Services SG&A is expected to run around 28% in the second half as investments continue. He also cited stable credit metrics, with aging at 3.3%, write-offs around 7.2%, an unchanged $935 million allowance, and a 2026 CapEx range lowered to $450 million to $500 million due mainly to timing and tighter project management.

Analysts pressed management on how much of the new “customer occasion” strategy is about filling assortment gaps versus packaging existing products differently, and Greg said it is both, citing examples like wrapping paper and lower-priced Chromebooks. Questions also centered on the 14% eCommerce growth, where management said free ship-to-home, better site traffic, buy-online-pickup-in-store, and 12,000 online-only items are broadening the addressable market rather than being driven mainly by SportChek. On the bank, management said insolvencies are being watched but payment behavior and reserves remain stable, and the higher SG&A rate reflects both growth investments and regulatory requirements.