Cherokee Global Brands reported quarterly earnings that missed Wall Street expectations, while also announcing that Target stores are dropping one of its apparel lines.
The Sherman Oaks fashion licensing company on Thursday reported net income of $1.93 million (22 cents a share) for the fiscal second quarter ending Aug. 1, compared to net income of $2.25 million (27 cents) for the same quarter a year ago. Revenue fell 3 percent to $8.5 million.
Analysts on average expected net income of 24 cents on revenue of $8.62 million, according to Thomson Financial Network.
The company also announced that that Target Corp. did not renew its license for the Cherokee brand in the U.S., which will expire in January 2017.
“The company does not expect the non-renewal to have any material impact on Cherokee Global Brands' revenue in fiscal 2016. Cherokee Global Brands anticipates that it will establish new channels for Cherokee branded products in the U.S.,” the company said in a statement.
Results were announced after market close. Shares closed down 71 cents or 2.9 percent to $24.11 on the Nasdaq.