Crocs, Inc. Reports Third Quarter 2025 Results

Core Insights - Crocs, Inc. reported its third-quarter 2025 financial results, highlighting a disciplined execution of brand strategies and product innovation, which led to strong profitability and cash flow [2][10] - The company repurchased 2.4 million shares and paid down $63 million of debt during the quarter, emphasizing its value creation model [2][10] - Crocs anticipates $50 million in gross cost savings for 2025 and has identified an additional $100 million in cost savings for 2026 [3] Financial Performance - Consolidated revenues for Q3 2025 were $996 million, a decrease of 6.2% year-over-year, with a 6.8% decline on a constant currency basis [11] - Direct-to-consumer (DTC) revenues grew by 1.6%, while wholesale revenues decreased by 14.7% [11] - Gross margin declined by 110 basis points to 58.5%, and selling, general, and administrative expenses increased by 3.3% to $375 million, representing 37.7% of revenues [11] Brand Performance - Crocs Brand revenues decreased by 2.5% to $836 million, with DTC revenues increasing by 2.0% and wholesale revenues decreasing by 7.9% [11] - International revenues for the Crocs Brand increased by 5.8%, while North America revenues decreased by 8.8% [11] - HEYDUDE Brand revenues decreased by 21.6%, with DTC revenues down by 0.5% and wholesale revenues down by 38.6% [11] Balance Sheet and Cash Flow - Cash and cash equivalents were $154 million, down from $186 million, while inventories increased to $397 million from $367 million [11] - Total borrowings decreased to $1,318 million from $1,422 million [11] - Capital expenditures for the full year 2025 are expected to be between $70 million and $75 million [6] Future Outlook - For Q4 2025, revenues are expected to decline approximately 8% compared to Q4 2024, with the Crocs Brand projected to decrease by about 3% and HEYDUDE Brand expected to decline by mid-20% [11] - Adjusted diluted earnings per share are anticipated to be in the range of $1.82 to $1.92 [11]