Shares of Crocs Inc. jumped in early morning trading, after beating Wall Street’s third quarter consensus estimates even though the shoe firm forecasts a fourth quarter revenue decline.
Shares of Crocs rose 5.2 percent to $89.07 in NasdaqGS trading.
For the three months ended Sept. 30, net income fell 27.0 percent to $145.8 million, or $2.70 a diluted share, from $199.8 million, or $3.36, in the year-ago period. On an adjusted basis, diluted EPS were $2.92. Revenues were down 6.2 percent to $996.3 million from $1.06 billion a year ago. By channel, direct-to-consumer (DTC) revenue rose 1.6 percent, while wholesale revenue fell 14.7 percent.
Related Stories
Crocs easily bested Wall Street’s expectations of adjusted diluted EPS of $2.36 on revenue of $961.5 million.
You May Also Like
For the nine months, the net loss was $186.4 million, or $3.38 a diluted share, against net income of $581.2 million, or $9.62, a year ago. Revenues slipped 0.9 percent to $3.08 billion from $3.11 billion in the same year-ago period.
The company also guided adjusted fourth quarter diluted EPS to the range of $1.82 to $1.92, better than the $1.75 consensus estimates of Wall Street analysts. But the company did project a decline in fourth quarter revenue during the all-important holiday season.
The shoe and accessories firm said it expects revenue to be down 8 percent from year-ago levels. Crocs brand revenues were guided down 3 percent, while the struggling Hey Dude brand was forecasted to be down mid-20 percent from year-ago levels.
“Our third-quarter performance was driven by disciplined execution against our brand strategies, as well as greater product and go-to-market innovation,” said Crocs CEO Andrew Rees.
Rees noted that the strength of the firm’s profitability and cash flow enabled it to repurchase 2.4 million of its outstanding shares and pay down $63 million of debt in the quarter.
“While our results came in ahead of expectations, we believe both of our brands have greater potential, and are working to re-gain momentum in the marketplace,” Rees said.
For the quarter, Crocs revenue fell 2.5 percent to $836 million. By channel, DTC revenues rose 2.0 percent to $472 million, but wholesale revenues fell 7.9 percent to $364 million. Revenues in North America were down 8.8 percent to $448 million, although international revenues rose 5.8 percent to $389 million.
At Hey Dude, revenues dropped 21.6 percent to $160 million. By channel, DTC slipped 0.5 percent to $91 million. However, wholesale revenue plummeted 38.6 percent to $69 million.
Rees noted that in addition to the $50 million of gross cost savings in 2025, the company has identified an “incremental $100 million of gross cost savings.” And Crocs is also committed to driving operating leverage in 2026, the CEO added.
This past summer, Crocs opened its new Icon store in July in New York’s SoHo neighborhood at 543 Broadway. The store features immersive storytelling, and allows the brand to showcase its full collection of core Crocs shoes and growing footwear options, such as sandals.
And last month, former Nike executive Patraic Reagan became the new CFO at Crocs on Sept. 22. In merchandising news, Crocs also introduced two experimental new models, part of its Exp franchise, last month. One is a part-moccasin, part-sneaker Gallery Shoe that gets its inspiration from the sneaker loafer trend. The other is a new Ripple slip-on.