Crocs has released its Q2 earnings report, in which the company lowered its Q3 forecast and announced plans to reduce orders for the second half of the year.
Crocs’ second quarter 2025 results showed a net loss of $492.3 million, or $8.82 per share, compared to a net income of $228.9 million, or $3.77 per share, in the same period last year.
For the third quarter of 2025, Crocs anticipates an adjusted operating margin of approximately 18% to 19%, including an estimated negative impact of around 170 basis points “pending tariffs.”
Crocs Q3 revenue is forecast to be down approximately 11% to 9% compared to Q3 2024.
Andrew Rees, Crocs CEO, told investors: “We reported a solid second quarter with both our Crocs and HEYDUDE brands contributing to our performance, while delivering the highest-ever gross profit quarter in company history. Our strong cash flow generation enabled us to return shareholder value through $133 million in share repurchases and $105 million in debt paydown.”
“While we are pleased by this performance, the current operating environment is uncertain and challenging to predict. Against this, we have chosen to focus on managing expenses including the $50 million in cost savings we have already implemented, reducing our inventory receipts, and pulling back on promotional activity to protect brand health in the marketplace. Although these actions will impact the topline of our business in the short term, they will position our business to win, drive margin dollars, and support continued cash flow generation longer term.”
During an earnings call after the Q2 report was released, Rees stated that the company’s actions would “create further headwinds to sales volume over the next several quarters.”
“We see the U.S. consumer behaving cautiously around discretionary spending. They are faced with current and implied future price increases, which we think has the potential to be a further drag on an already choiceful consumer. Against this backdrop, our retail partners are acting more carefully and reducing their open-to-buy dollars in future seasons,” he concluded.
Following Rees’ announcement, Crocs shares dropped nearly 30%.
By CEO NA Editorial Staff
