SHOO Q2 Earnings Lag Estimates, Wholesale Revenues Decline Y/Y

Steven Madden, Ltd. SHOO reported second-quarter 2025 results, wherein the top and bottom lines lagged the Zacks Consensus Estimate. Total revenues increased and earnings decreased from the year-ago period. Wholesale revenues declined year over year. As a result, SHOO shares fell 9.3% yesterday.

The company faced a challenging second quarter due to the impacts of new tariffs on goods imported into the United States. Despite these pressures, it remains focused on long-term growth, responding with agility to near-term disruptions while continuing to execute its strategy of strengthening consumer engagement through compelling products and effective marketing.

The integration of Kurt Geiger is progressing smoothly, and the company is increasingly confident in its potential to serve as a significant growth driver in the years ahead. 

While tariffs have introduced added uncertainty, the company’s strong brand portfolio, solid balance sheet and proven business model provide a firm foundation to navigate the current environment and deliver sustainable growth over time.

Steven Madden’s Quarterly Performance: Key Insights

SHOO posted adjusted quarterly earnings of 20 cents per share, which missed the Zacks Consensus Estimate of 24 cents. The metric plummeted 64.9% from 57 cents in the prior-year period. 

Total revenues rose 6.8% year over year to $559 million. Net sales of $556.1 million grew 6.6%, and licensing fee income of $2.9 million increased 57.8% from the year-ago period. The top line missed the consensus estimate of $576 million.

Adjusted gross profit rose 7.8% year over year to $234.3 million, which surpassed our estimate of $228.1 million. We note that the adjusted gross margin expanded 40 basis points (bps) to 41.9%. 

The company’s adjusted operating expenses increased 30% year over year to $211.6 million. As a percentage of revenues, adjusted operating expenses increased 680 bps year over year to 37.9%.

Steven Madden reported an adjusted operating income of $22.6 million, down 58.5% from the prior-year quarter. The adjusted operating margin decreased 640 bps to 4%. We expected an adjusted operating margin of 4.7% for the quarter.

SHOO’s Segmental Performance

Wholesale revenues for the quarter were $360.6 million, representing a 6.4% decline from the second quarter of 2024. Excluding the impacts of the recently acquired Kurt Geiger, wholesale revenues fell 12.8%. Within this segment, wholesale footwear revenues decreased 7.1%, or 11.7% excluding Kurt Geiger, while wholesale accessories and apparel revenues dropped 5.3%, or 14.6% excluding the acquisition. The adjusted gross margin in this segment was 30.9%, down 220 basis points due to the effects of newly implemented tariffs on goods imported into the United States.

Direct-to-consumer revenues reached $195.5 million, marking a 43.3% increase from the year-ago period. However, when excluding Kurt Geiger, direct-to-consumer revenues declined 3%, with decreases observed in both brick-and-mortar stores and e-commerce platforms. The adjusted gross margin was 61.3%, down 300 basis points year over year. These decreases were led largely by the inclusion of the Kurt Geiger concessions business and the impacts of new import tariffs.

At the end of the second quarter, the company operated 392 brick-and-mortar retail stores, which included 98 outlets. Moreover, it ran seven e-commerce websites and 130 company-operated concessions in international markets. Of these, Kurt Geiger accounted for 73 brick-and-mortar stores, including 27 outlets, two e-commerce websites and 72 concessions.

SHOO Stock Past 3 Months' Performance

SHOO’s Financial Health Snapshot

Steven Madden ended the quarter with cash and cash equivalents of $111.7 million, short-term investments of $0.1 million and stockholders’ equity of $863.4 million, including non-controlling interest of $30.1 million.

In the second quarter, the company did not repurchase any shares of its common stock in the open market.

SHOO announced a cash dividend of 21 cents per share, payable Sept. 23, 2025, to its shareholders of record as of Sept. 12.

Due to ongoing macroeconomic uncertainty stemming from the impacts of newly imposed tariffs on goods imported into the United States, the company has decided not to issue the financial guidance for 2025 at this time.

In the past month, shares of this Zacks Rank #5 (Strong Sell) company have gained 14.2% compared with the industry’s 33.6% growth.

Stocks to Consider

Some better-ranked stocks are Levi Strauss & Co. LEVI, Stitch Fix SFIX and Sportsman's Warehouse Holdings, Inc. SPWH.

Levi designs and markets jeans, casual wear and related accessories for men, women and children. It flaunts a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for Levi’s current fiscal-year earnings indicates growth of 4% from the year-ago actual. LEVI delivered a trailing four-quarter average earnings surprise of 25.9%.

Stitch Fix delivers customized shipments of apparel, shoes and accessories for women, men and kids. It has a Zacks Rank #2 (Buy) at present. 

The Zacks Consensus Estimate for Stitch Fix’s fiscal 2025 earnings indicates growth of 71.7% from the fiscal 2024 reported level. SFIX delivered a trailing four-quarter average earnings surprise of 51.4%.

Sportsman's Warehouse is an outdoor sporting goods retailer. It presently has a Zacks Rank of 2.

The Zacks Consensus Estimate for Sportsman's Warehouse’s current fiscal-year earnings and sales indicates growth of 30.2% and 1.2%, respectively, from the year-ago actuals. SPWH delivered a trailing four-quarter average earnings surprise of 72.3%.

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This article originally published on Zacks Investment Research (zacks.com).

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