Core Viewpoint - Weyco Group, Inc. reported a decline in financial performance for the second quarter of 2025, attributed to reduced consumer spending and increased tariffs impacting gross margins and profitability [1][15]. Financial Performance Summary - Net sales for the second quarter of 2025 were $58.2 million, down 9% from $63.9 million in the same quarter of 2024 [10]. - Gross earnings as a percentage of net sales decreased to 43.3% from 43.9% year-over-year [10]. - Earnings from operations fell to $3.9 million, a 42% decrease compared to $6.7 million in Q2 2024 [10]. - Net earnings were $2.3 million, down 60% from $5.6 million in Q2 2024 [10]. - Diluted earnings per share decreased to $0.24 from $0.59 in Q2 2024 [10]. Segment Performance North American Wholesale Segment - Wholesale net sales were $45.6 million, down 9% from $50.3 million in Q2 2024 [3]. - Sales for major brands such as Nunn Bush, Stacy Adams, Florsheim, and BOGS decreased by 11%, 10%, 5%, and 14%, respectively [3]. - Wholesale gross earnings as a percentage of net sales were 37.6%, down from 38.2% in Q2 2024 [4]. - Operating earnings in this segment totaled $4.1 million, a 30% decline from $5.8 million in 2024 [4]. North American Retail Segment - Retail segment net sales were $6.8 million, down 11% from $7.6 million in 2024 [8]. - Retail gross earnings as a percentage of net sales decreased to 66.6% from 67.5% in the previous year [9]. - Operating earnings in the retail segment fell to $0.1 million from $0.7 million in Q2 2024 [9]. Other Operations - Net sales from Florsheim Australia were $5.8 million, down 4% from $6.1 million in Q2 2024 [12]. - Operating losses in Florsheim Australia totaled $0.2 million, compared to operating earnings of $0.2 million in the previous year [13]. Tariff Impact - The U.S. government enacted incremental tariffs on imported goods, with tariffs on goods sourced from China reaching 145% before being temporarily reduced to 30% [5]. - The company has implemented measures to mitigate the impact of these tariffs, including increasing inventory ahead of tariff changes and negotiating cost reductions with suppliers [6][7]. Tax Provision - The effective tax rate for Q2 2025 was 51.1%, up from 25.1% in Q2 2024, primarily due to a valuation allowance on deferred tax assets [14]. Dividend Declaration - The Board of Directors declared a quarterly cash dividend of $0.27 per share, payable on September 30, 2025 [16].