Core Viewpoint - Crocs Inc. experienced a decline in sales of its namesake brand for the first time in five years, leading to a drop in share prices and expectations of continued sales decline as customer preferences shift [1] Company Summary - The footwear maker's sales decline marks a significant change in its performance trajectory, indicating potential challenges ahead for the brand [1] - The decline in sales is attributed to changing customer behaviors, suggesting a need for the company to adapt its strategies to maintain market relevance [1] Industry Summary - The footwear industry may be facing shifts in consumer preferences, which could impact sales for brands similar to Crocs Inc. [1] - The decline in sales for a leading brand like Crocs could signal broader trends within the industry that warrant close monitoring [1]

Q2 2025 Financial Performance - Crocs, Inc reported solid Q2 results, with both Crocs and HEYDUDE brands contributing to the performance[5] - The company achieved its highest ever gross profit quarter in company history[5] - Q2 2025 revenues reached $1,149 million, a 3% increase compared to the previous year[35] - Adjusted gross margin was 61.7%, a 30 bps increase year-over-year[35] - Adjusted operating income was $309 million, a 5% decrease year-over-year[35] - Adjusted diluted EPS was $4.23, a 5% increase year-over-year[35] Brand Performance - Crocs brand revenues were $960 million, a 4% increase year-over-year[35] - HEYDUDE brand revenues were $190 million, a 4% decrease year-over-year[35] - Crocs brand international revenue grew 16%[36] - HEYDUDE direct-to-consumer sales grew 7%[40] Capital Allocation and Outlook - The company repurchased $133 million in shares and paid down $105 million in debt[5] - Q3 2025 total revenue is expected to decline by 11% to 9% year-over-year[24] - Q3 2025 adjusted operating margin is projected to be 18% to 19%, including an estimated 170 bps tariff headwind[24] - The company has $1.1 billion remaining for share repurchases[29]

Investors who choose to actively manage their portfolios, picking individual businesses in the process, probably want to beat the market over the long term. To achieve this goal, perhaps it's a good idea to look at past winners. Maybe the good times will continue.Artificial intelligence might be getting all the attention. However, there's one booming footwear stock that has skyrocketed 465% in the past five years (as of May 14). That kind of stellar performance deserves a closer look.Is this the smartest st ...