Crocs(US:CROX) GlobeNewswire News Roomยท2025-02-10 13:44Core Viewpoint - A securities class action lawsuit has been filed against Crocs, Inc. for allegedly misleading investors regarding the performance and demand for HEYDUDE products following its acquisition in February 2022 [1][3]. Company Overview - Crocs, Inc. is headquartered in Bloomfield, CO, and is known for marketing casual footwear. The company acquired HEYDUDE, another casual footwear brand, in February 2022 [2]. Allegations of Misleading Information - The lawsuit claims that Crocs concealed the fact that the strong revenue growth of HEYDUDE was primarily due to Crocs' decision to aggressively stock third-party wholesalers with HEYDUDE products, irrespective of actual retail demand [3]. - After retail partners began to destock excess inventory, Crocs allegedly misled investors by not disclosing that declining demand for HEYDUDE shoes would negatively affect the company's financial results [4]. Disclosure of Financial Performance - Investors became aware of the true situation regarding HEYDUDE's performance through a series of partial disclosures, culminating in a significant announcement on October 29, 2024. Crocs reported that HEYDUDE revenues fell short of expectations and acknowledged that it would take longer than anticipated for the business to recover [5]. - The CEO of Crocs admitted to shipping excessive product quantities and recognized that a lack of demand worsened the inventory issue [5]. Impact on Stock Price - Following the disclosure of HEYDUDE's disappointing performance, Crocs' share price dropped by $26.47, or 19%, from $138.05 on October 28, 2024, to $111.58 on October 29, 2024 [6].