Core Viewpoint - Steven Madden Ltd. reported third quarter results that missed Wall Street's revenue estimates, leading to a decline in share price [1] Financial Performance - For the three months ended September 30, net income decreased by 62.9% to $20.5 million, or 29 cents per diluted share, compared to $55.3 million, or 77 cents, in the same quarter last year [4] - Total revenue increased by 6.9% to $667.9 million from $624.7 million, driven by a 6.9% rise in net sales to $664.2 million and a 4.9% increase in licensing fee income to $3.7 million [4] - For the nine months, net income was $21.5 million, or 30 cents per diluted share, down from $134.6 million, or $1.87, in the same period last year, while total revenue grew by 4.7% to $1.78 billion [7] Revenue Breakdown - Wholesale revenue fell by 10.7% to $442.7 million, with a 19.0% decline when excluding the recently acquired Kurt Geiger brand [5] - Direct-to-consumer revenue rose by 76.6% to $221.5 million, with a 1.5% increase when excluding Kurt Geiger [6] Future Outlook - The company guided adjusted diluted EPS for the fourth quarter to be in the range of 41 cents to 46 cents, expecting revenue to rise by 27% to 30% from year-ago levels [8] - The acquisition of Kurt Geiger is expected to contribute positively to financial results starting in the fourth quarter [3] Analyst Commentary - Jefferies analyst Corey Tarlowe has a "Hold" rating on the company, describing the third quarter results as "solid" and noting strong performance from the Kurt Geiger brand [9]

Core Insights - Steve Madden Ltd.'s acquisition of Kurt Geiger is viewed positively by Wall Street analysts, highlighting potential for retail growth and profitability in the U.S. market [1] - The wholesale channel presents significant opportunities for Kurt Geiger, with current U.S. wholesale accounts including major retailers like Dillards, Bloomingdales, and Nordstrom [1] - Analysts expect Kurt Geiger to contribute positively to earnings per share (EPS), with initial estimates of 10 cents in 2025, potentially increasing to over 40 cents in the following year [3][4] Retail Growth Potential - Kurt Geiger has six retail stores in the U.S. that are performing well, showcasing strong four-wall profitability [1] - There is a long runway for retail growth at Geiger, particularly as the brand can leverage its existing store performance [1] Wholesale Opportunities - The current number of retail doors in the wholesale channel for Kurt Geiger is estimated to be less than 500, compared to competitors like Coach and Michael Kors, which have between 1,200 to 2,000 [1] - The potential for gaining shelf space in retail stores is highlighted, especially as competitors like Michael Kors face challenges with inventory restocking [2] Earnings Projections - Madden's management anticipates that Kurt Geiger will be accretive to EPS, with a target of 10 cents in 2025, despite recent guidance pullbacks due to external factors [3] - Analysts project that if revenue growth can be re-accelerated to a low-double-digits percentage, Kurt Geiger could contribute over 40 cents to EPS [4] - Long-term projections suggest that Kurt Geiger could account for $1.50-$1.70 in EPS based on management's revenue assumptions of $1 billion and a mid-teens operating margin [5]

Financial Data and Key Metrics Changes - Consolidated revenue for Q2 2025 was $559 million, a 6.8% increase compared to 2024. Excluding the newly acquired Kurt Geiger, consolidated revenue decreased by 10% [9] - Wholesale revenue was $360.6 million, down 6.4% compared to Q2 2024, and down 12.8% excluding Kurt Geiger [10] - Direct-to-consumer (DTC) segment revenue increased by 43.3% to $195.5 million, but decreased by 3% excluding Kurt Geiger [10] - Consolidated gross margin was 41.9%, compared to 41.5% in Q2 2024, with tariffs impacting gross margin by approximately 230 basis points [12] - Operating income for the quarter was $22.6 million, or 4% of revenue, compared to $54.5 million, or 10.4% of revenue in the prior year [13] - Net income attributable to Steve Madden Limited was $13.9 million, or $0.20 per diluted share, compared to $41.2 million, or $0.57 per diluted share in 2024 [13] Business Line Data and Key Metrics Changes - Wholesale footwear revenue was $220.1 million, a 7.1% decrease from Q2 2024, or down 11.7% excluding Kurt Geiger [10] - Wholesale accessories and apparel revenue was $140.4 million, down 5.3% compared to the prior year, or down 14.6% excluding Kurt Geiger [10] - The apparel business saw revenue growth, being one of the few segments that performed well during the quarter [38] Market Data and Key Metrics Changes - The company ended the quarter with 392 company-operated retail stores, including 98 outlets, and 130 company-operated concessions in international markets [11] - Licensing royalty income was $2.9 million in the quarter, compared to $1.8 million in 2024 [11] - International business, excluding Kurt Geiger, was up about 8% in revenue or about 10% in constant currency [88] Company Strategy and Development Direction - The company is focused on diversifying sourcing out of China due to tariff impacts, with plans to source approximately 30% of US imports from China for fall 2025, down from 71% in 2024 [5] - The integration of the newly acquired Kirk Geiger is progressing well, with strong momentum and potential for significant growth [8] - Marketing efforts are being amplified to deepen consumer connections, particularly targeting Gen Z and millennials through various channels [7] Management's Comments on Operating Environment and Future Outlook - Management acknowledged that the second quarter was challenging due to new tariffs, leading to order cancellations and lost sales [4] - The company expects continued impacts from tariff-related disruptions in Q3, but anticipates improvements in Q4 [20] - Management remains optimistic about long-term growth, citing strong brand positioning and a robust balance sheet [8] Other Important Information - The company did not repurchase any shares during the quarter and declared a quarterly cash dividend of $0.21 per share [14] - Due to ongoing uncertainties regarding tariffs, the company will not provide financial guidance for 2025 [15] Q&A Session Summary Question: Which wholesale channels saw significant order cancellations? - The mass and off-price channels experienced the most significant order cancellations, with approximately 95% of the wholesale revenue shortfall coming from these areas [18] Question: What is the expected gross margin pressure for Q3 and Q4? - Continued pressure on gross margins is expected in Q3, with hopes for improvement by Q4 [20] Question: How has consumer response been to price increases? - The company is seeing a positive consumer response to average price increases of about 10%, particularly in trending categories like dress shoes and summer boots [26] Question: What is the current margin profile for Kurt Geiger? - Kurt Geiger's EBIT margins were about 9.3% prior to acquisition, expected to decrease slightly this year due to tariff pressures [71] Question: How did the Nordstrom anniversary sale perform? - The Nordstrom anniversary event performed very well, indicating strong sell-through and optimism for future sales [93]

Group 1 - KKR is set to acquire a stake in Yuanjing International, which is believed to be linked to Dayao Beverage [1][2][3] - KKR will indirectly acquire 85% of Yuanjing International through a newly established special purpose company [3] - Yuanjing International holds a market share of 5% to 10% in the carbonated beverage market in China as of 2024, with Dayao Beverage ranking third at 2.42% [3][4] Group 2 - Dayao Beverage's market share has been gradually increasing, from 2.28% in 2023 to 2.64% in the first half of 2025 [5] - The carbonated beverage market is experiencing a contraction, with major players like Coca-Cola and Pepsi also reporting declining sales [4] - The potential sale to KKR raises questions about the classification of Dayao as a domestic brand [6]

Financial Data and Key Metrics Changes - Consolidated revenue for Q1 2025 was $553.5 million, a 0.2% increase compared to Q1 2024 [15] - Net income attributable to Steve Madden Limited for the quarter was $42.4 million, or $0.60 per diluted share, compared to $47 million, or $0.65 per diluted share in Q1 2024 [18] - Operating income for the quarter was $56.1 million, or 10.1% of revenue, compared to $61 million, or 11% of revenue in the comparable period in the prior year [17] Business Line Data and Key Metrics Changes - Wholesale revenue was $439.3 million, up 0.2% compared to Q1 2024, with wholesale footwear revenue at $296.1 million, a 0.2% increase [15] - Direct to consumer segment revenue declined 0.2% to $112.1 million, with a modest increase in digital business offset by a decline in brick and mortar [16] - Licensing royalty income was $2.2 million in the quarter, compared to $1.8 million in Q1 2024 [16] Market Data and Key Metrics Changes - The company expects to reduce production sourced from China to the mid-teens for fall 2025 and to the mid-single digits by spring 2026 [9] - The effective tax rate for the quarter was 24%, compared to 23.6% in Q1 2024 [18] Company Strategy and Development Direction - The acquisition of Kurt Geiger was highlighted as a significant investment, with an enterprise value of £289 million [11] - The company is focusing on shifting production out of China to countries like Vietnam, Cambodia, Mexico, and Brazil to mitigate tariff impacts [9][26] - The company plans to continue investing in marketing and strategic initiatives to position for long-term growth despite short-term challenges [10] Management Comments on Operating Environment and Future Outlook - Management acknowledged meaningful headwinds and uncertainty due to new tariffs on goods imported into the U.S. [8] - The company is confident in its ability to navigate current disruptions and return to profitable growth in the future [12] - Management noted that consumer demand remains stable but is being monitored closely due to recent declines in consumer confidence [69] Other Important Information - The company withdrew its 2025 financial guidance due to uncertainty related to new tariffs [20] - The company ended the quarter with $147.2 million in cash and no debt [18] Q&A Session Summary Question: How is the company handling orders from China? - The company is taking the majority of production that was far along in the process and negotiating price concessions to mitigate damage [24] Question: What countries is the company moving production to? - Production is being moved to countries like Cambodia, Vietnam, Mexico, and Brazil, with a focus on improving speed and reducing tariff risks [26] Question: What is the impact of tariffs on margins? - The company is accepting lower margins when moving production to other countries and is experiencing price pressure due to increased demand [31] Question: How is the company managing inventory levels? - Inventory is up 18%, primarily due to longer lead times and the decision to accelerate certain shipments ahead of tariff announcements [19][46] Question: What is the outlook for the handbag category? - The company expects continued pressure in the handbag category due to excess inventory and tariff disruptions [91] Question: What are the expectations for the Kirk Geiger acquisition? - The company is looking at a more conservative revenue expectation for both the existing business and Kirk Geiger due to current market conditions [102]

Financial Data and Key Metrics Changes - Consolidated revenue for Q1 2025 was $553.5 million, a 0.2% increase compared to Q1 2024 [13] - Net income attributable to the company was $42.4 million or $0.60 per diluted share, down from $47 million or $0.65 per diluted share in Q1 2024 [17] - Operating income for the quarter was $56.1 million or 10.1% of revenue, compared to $61 million or 11% of revenue in the prior year [16] Business Line Data and Key Metrics Changes - Wholesale revenue was $439.3 million, up 0.2% compared to Q1 2024, with wholesale footwear revenue at $296.1 million, also a 0.2% increase [13][14] - Direct to consumer segment revenue declined 0.2% to $112.1 million, with a modest increase in digital sales offset by a decline in brick-and-mortar [15] - Licensing royalty income increased to $2.2 million from $1.8 million in Q1 2024 [15] Market Data and Key Metrics Changes - The company sourced 71% of US imports from China in 2024, expected to drop to mid-teens for fall 2025 and mid-single digits by spring 2026 [8] - Inventory was $238.6 million, significantly higher than $200 million in Q1 2024, driven by longer lead times and accelerated shipments [18] Company Strategy and Development Direction - The acquisition of Kurt Geiger was highlighted as a significant investment, with an enterprise value of £289 million and expected to enhance growth in international markets and accessories [10] - The company is shifting production out of China to countries like Vietnam, Cambodia, Mexico, and Brazil to mitigate tariff impacts and improve operational efficiency [7][26] - The company plans to selectively raise prices to offset increased costs, with an average increase around 10% [50] Management Comments on Operating Environment and Future Outlook - Management acknowledged meaningful headwinds due to new tariffs but expressed confidence in the company's agility and strong balance sheet to navigate challenges [11] - The company is withdrawing its 2025 financial guidance due to uncertainty related to tariffs [19] - Management noted that consumer demand remains stable but is being monitored closely due to declining consumer confidence [68] Other Important Information - The company completed a reduction in force resulting in over $12 million in annual savings [9] - The effective tax rate for the quarter was 24%, slightly up from 23.6% in Q1 2024 [17] Q&A Session Summary Question: How is the company handling orders from China? - The company is taking most production that is far along but has negotiated price concessions to mitigate damage and keep goods flowing [24] Question: What is the impact of moving production to other countries? - The company is replacing production in other countries and expects to see a revenue impact due to cancellations and delayed deliveries [28] Question: How are gross margins expected to trend? - Gross margins were better than anticipated in Q1, but significant impacts from tariffs are expected in Q2 [38] Question: What is the strategy for mitigating tariffs? - The company is moving production out of China, negotiating factory cost concessions, and raising prices [101] Question: What are the expectations for the Kirk Geiger acquisition? - The company expects a more conservative revenue outlook for both the existing business and Kirk Geiger due to current market conditions [102] Question: How is consumer behavior changing in response to price increases? - Consumer demand is holding steady, but management is cautious about potential impacts from rising prices [68]

Financial Data and Key Metrics Changes - Consolidated revenue for Q1 2025 was $553.5 million, a 0.2% increase compared to Q1 2024 [13] - Net income attributable to Steve Madden Limited was $42.4 million, or $0.60 per diluted share, compared to $47 million, or $0.65 per diluted share in Q1 2024 [17] - Consolidated gross margin increased to 40.9% from 40.7% in the comparable period of 2024 [15] - Operating income for the quarter was $56.1 million, or 10.1% of revenue, down from $61 million, or 11% of revenue in the prior year [16] Business Line Data and Key Metrics Changes - Wholesale revenue was $439.3 million, up 0.2% compared to Q1 2024, with wholesale footwear revenue at $296.1 million, also a 0.2% increase [13] - Direct to consumer segment revenue declined 0.2% to $112.1 million, with a modest increase in digital sales offset by a decline in brick-and-mortar [14] - Licensing royalty income increased to $2.2 million from $1.8 million in Q1 2024 [14] Market Data and Key Metrics Changes - The company expects to reduce production sourced from China to the mid-teens for fall 2025 and to the mid-single digits by spring 2026 [7] - The company has begun selectively raising prices to consumers and wholesale customers, with an average increase around 10% [49] Company Strategy and Development Direction - The acquisition of Kurt Geiger was highlighted as a significant investment, with the brand showing strong momentum and alignment with the company's strategic initiatives [10] - The company is focusing on diversifying production out of China to mitigate tariff impacts and has successfully negotiated discounts on products from China [6][9] - The company aims to leverage its strong balance sheet and marketing investments to navigate current challenges and capture market share [9][11] Management's Comments on Operating Environment and Future Outlook - Management acknowledged meaningful headwinds due to new tariffs but expressed confidence in the company's ability to adapt and grow [6][11] - The company has withdrawn its 2025 financial guidance due to uncertainty related to tariffs [19] - Management noted that consumer demand remains stable but is being monitored closely due to declining consumer confidence [66] Other Important Information - The company completed a reduction in force that will result in over $12 million in annual savings [9] - Inventory increased to $238.6 million, driven by longer lead times and diversification efforts [18] Q&A Session Summary Question: How is the company handling orders from China? - The company is taking most production that is far along but has negotiated price concessions to mitigate damage [23] Question: What countries is the company moving production to? - Production is being shifted to countries like Cambodia, Vietnam, Mexico, and Brazil, with a focus on Mexico and Brazil for improved speed [26] Question: What is the impact of tariffs on margins? - The company is accepting lower margins when moving production to other countries and is experiencing price pressure due to increased demand [30] Question: How is the company managing inventory growth? - Inventory growth is primarily due to longer lead times and diversification efforts, with confidence in inventory health for Q2 [45] Question: What is the company's strategy regarding price increases? - The company is raising prices selectively, with an average increase around 10%, while monitoring demand elasticity [49] Question: What is the outlook for the handbag category? - The company expects continued pressure in the handbag category due to excess inventory in the channel [87] Question: How is the company addressing private label versus branded performance? - The branded business performed better in Q1, with a focus on growing the international business due to tariff impacts [80]

Core Insights - The company announced the completion of the acquisition of Kurt Geiger, which is expected to enhance growth and align with strategic initiatives [4][11] - The first quarter of 2025 showed a slight revenue increase of 0.2% year-over-year, with total revenue reaching $553.5 million [8] - The company is facing near-term challenges due to new tariffs impacting imported goods, but remains optimistic about long-term growth opportunities [3][12] Financial Performance - Revenue for the wholesale business was $439.3 million, a 0.2% increase compared to the first quarter of 2024, with gross profit margin improving to 35.7% from 35.1% [5] - Direct-to-consumer revenue decreased by 0.2% to $112.1 million, with gross profit margin declining to 60.1% from 61.9% due to increased promotional activity [6] - Net income attributable to Steven Madden, Ltd. was $40.4 million, or $0.57 per diluted share, compared to $43.9 million, or $0.60 per diluted share, in the same period of 2024 [8][20] Balance Sheet and Cash Flow - As of March 31, 2025, cash and cash equivalents totaled $147.2 million, while inventory increased to $238.6 million from $202.0 million a year earlier [7][22] - The company ended the quarter with a total asset value of $1.427 billion, reflecting a slight increase from $1.411 billion at the end of 2024 [22] - The company did not repurchase any shares in the open market during the first quarter but spent $7.8 million on share repurchases through net settlements of employee stock awards [9] Acquisition Details - The acquisition of Kurt Geiger was completed for an enterprise value of approximately £289 million, funded through a new credit agreement and cash on hand [11] - Kurt Geiger reported revenue of £400 million for the twelve months ended February 1, 2025, indicating a strong market presence [11] Future Outlook - The company has withdrawn its 2025 financial guidance due to macroeconomic uncertainties related to new tariffs and is not providing guidance at this time [12]

Financial Data and Key Metrics Changes - For the fourth quarter of 2024, consolidated revenue was $582.3 million, a 12% increase compared to Q4 2023 [19] - Full year revenue for 2024 increased 15.2% to $2.3 billion compared to $2.0 billion in 2023 [22] - Diluted EPS for Q4 2024 was $0.55, down from $0.61 in Q4 2023, while full year diluted EPS increased to $2.67 from $2.45 in 2023 [22][23] - Consolidated gross margin was 40.4% in Q4 2024, down from 41.7% in Q4 2023 [21] Business Line Data and Key Metrics Changes - Wholesale revenue for Q4 2024 was $402.9 million, up 13.6% year-over-year, with footwear revenue increasing by 1% to $227.4 million [19] - Accessories and apparel revenue surged 35.4% to $175.4 million in Q4 2024, driven by strong growth across categories [19] - Direct-to-Consumer (DTC) revenue was $176 million, an 8.4% increase compared to Q4 2023, with Steve Madden DTC revenue up 6% and Dolce Vita DTC revenue growing 36% [12][20] Market Data and Key Metrics Changes - International revenue grew 12% in 2024, with EMEA region revenue increasing 18% [9] - Revenue in the Americas excluding the U.S. grew 9%, supported by a new joint venture in Latin America [9] Company Strategy and Development Direction - The company aims to expand its international presence and diversify production away from China, targeting a reduction in goods sourced from China to the low 40% range by November 2025 [14][28] - The acquisition of Kurt Geiger is expected to enhance growth in international markets and accessories categories, aligning with the company's strategic initiatives [15][44] Management's Comments on Operating Environment and Future Outlook - Management expressed caution regarding the outlook for 2025 due to new tariffs and inventory pressures in the handbag business [14] - The company anticipates revenue growth of 17% to 19% in 2025, including contributions from Kurt Geiger, but expects low single-digit growth excluding the acquisition [24] Other Important Information - The company returned nearly $160 million to shareholders through dividends and share repurchases [14] - Inventory at the end of 2024 was $257.6 million, up 12.5% year-over-year, attributed to longer transit times [23][96] Q&A Session Summary Question: Can you talk about gross margin pressure and plans to mitigate it? - Management acknowledged tariff pressures and outlined strategies including diversifying production and selective price increases [26][28] Question: How is the DTC business performing in January versus February? - Management noted a slow start to the year, particularly in spring product sales, attributed to weather and consumer confidence [38][40] Question: Why is now the right time for the Kurt Geiger acquisition? - The acquisition is seen as an opportunity to leverage Kurt Geiger's growth potential and align with strategic initiatives [43][44] Question: What are the expectations for organic growth in 2025? - Management expects low single-digit growth in wholesale and high single-digit growth in DTC, with specific pressures noted in the handbag segment [54][55] Question: How is inventory health and performance of boots? - Inventory is considered healthy, with a strong boot season reported, but management is focused on transitioning consumers to spring styles [94][98]