Steven Madden(SHOO) - 2025 Q2 - Quarterly Results

Second Quarter 2025 Financial Results Executive Summary Q2 2025 was challenging due to new U.S. tariffs, resulting in a net loss despite revenue growth driven by the Kurt Geiger acquisition - Q2 performance was significantly impacted by new U.S. tariffs[4] - Integration of Kurt Geiger is smooth, expected to drive future growth[4] - Company focuses on core strategies and consumer connections to navigate current environment[4] Financial Performance Q2 2025 revenue grew 6.8% to $559.0 million, but GAAP net loss was $39.5 million due to tariffs and acquisition costs Consolidated Results Q2 2025 Consolidated Financial Highlights (GAAP) | Metric | Q2 2025 | Q2 2024 | Change | | :--- | :--- | :--- | :--- | | Total Revenue | $559.0M | $523.6M | +6.8% | | Gross Profit Margin | 40.4% | 41.5% | -110 bps | | (Loss) / Income from Operations | ($40.3M) | $46.9M | N/A | | Net (Loss) / Income | ($39.5M) | $35.4M | N/A | | Diluted (Loss) / EPS | ($0.56) | $0.49 | N/A | Q2 2025 Consolidated Financial Highlights (Adjusted) | Metric | Q2 2025 | Q2 2024 | Change | | :--- | :--- | :--- | :--- | | Adjusted Gross Profit Margin | 41.9% | N/A | N/A | | Adjusted Income from Operations | $22.6M | $54.5M | -58.5% | | Adjusted Net Income | $13.9M | $41.2M | -66.3% | | Adjusted Diluted EPS | $0.20 | $0.57 | -64.9% | Channel Performance - Wholesale revenue decreased 6.4% to $360.6 million, with gross margin contracting to 30.0% due to tariffs[5] - DTC revenue grew 43.3% to $195.5 million driven by Kurt Geiger, though gross margin fell to 58.7% due to tariffs[7] - Company ended Q2 with 392 company-operated stores and 130 concessions, including Kurt Geiger additions[8] Balance Sheet and Cash Flow As of June 30, 2025, cash was $111.9 million, total debt $293.5 million, resulting in $181.6 million net debt Balance Sheet Summary (as of June 30, 2025) | Metric | Amount | | :--- | :--- | | Cash, Cash Equivalents & Short-term Investments | $111.9M | | Total Debt Outstanding | $293.5M | | Net Debt | $181.6M | - No share repurchases were made during Q2 2025[10] Shareholder Returns Board approved a quarterly cash dividend of $0.21 per share, payable in September 2025 - A quarterly cash dividend of $0.21 per share was approved, payable September 23, 2025[11] Business Outlook Company refrains from providing 2025 financial outlook due to ongoing macroeconomic uncertainty and new U.S. tariffs - No 2025 financial guidance provided due to macroeconomic uncertainty and new tariffs[12] Financial Statements Condensed Consolidated Statements of Operations Q2 2025 revenue grew to $559.0 million, but increased operating expenses led to a $40.3 million operating loss and $39.5 million net loss Q2 Statement of Operations Highlights (In thousands) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | | :--- | :--- | :--- | | Total revenue | $559,000 | $523,553 | | Gross profit | $226,027 | $217,129 | | (Loss) / income from operations | $(40,258) | $46,870 | | Net (loss) / income attributable to Steven Madden, Ltd. | $(39,477) | $35,376 | | Diluted (loss) / income per share | $(0.56) | $0.49 | Condensed Consolidated Balance Sheets Total assets grew to $1.90 billion as of June 30, 2025, with liabilities rising to $1.03 billion due to acquisition-related debt Balance Sheet Highlights (In thousands) | Metric | June 30, 2025 | June 30, 2024 | | :--- | :--- | :--- | | Cash and cash equivalents | $111,714 | $180,457 | | Inventories | $436,968 | $241,643 | | Total Assets | $1,895,078 | $1,375,064 | | Long-term debt | $287,865 | $— | | Total Liabilities | $1,031,715 | $542,708 | | Total stockholders' equity | $863,363 | $832,356 | Condensed Consolidated Statements of Cash Flows Net cash from operations was $62.5 million, while investing activities used $392.8 million for acquisitions, resulting in a $78.2 million cash decrease Six-Month Cash Flow Summary (In thousands) | Metric | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $62,530 | $93,801 | | Net cash used in investing activities | $(392,751) | $(10,185) | | Net cash provided by / (used in) financing activities | $249,466 | $(105,508) | | Net decrease in cash and cash equivalents | $(78,210) | $(24,183) | Non-GAAP Reconciliation Reconciliation Summary Non-GAAP adjustments for Q2 2025, primarily acquisition-related, reconciled GAAP loss to $22.6 million adjusted operating income Q2 2025 GAAP to Non-GAAP Reconciliation (In thousands) | Metric | GAAP | Adjustments | Non-GAAP (Adjusted) | | :--- | :--- | :--- | :--- | | Gross Profit | $226,027 | $8,251 | $234,278 | | (Loss) / Income from Operations | $(40,258) | $62,887 | $22,629 | | Net (Loss) / Income Attributable to Steven Madden, Ltd. | $(39,477) | $53,357 | $13,880 | Detailed Non-GAAP Adjustments Q2 2025 pre-tax adjustments included $38.8 million for acquisition compensation and $8.3 million for inventory fair value - Key pre-tax adjustments for Q2 2025 included: - $38.8 million in acquisition-related compensation expense - $8.3 million expense for purchase accounting fair value adjustment of inventory - $8.1 million expense for acquisition and joint venture formation - $9.3 million benefit from the settlement of a foreign exchange hedging contract[26] - Q2 2024 adjustments were smaller, including a $6.6 million pre-tax expense for contingent consideration valuation change[27]