Crocs (CROX) Q2 2025 earnings summary

Executive summary

• Q2 2025 revenues grew 3.4% year-over-year to $1,149 million, driven by Crocs brand growth and partially offset by a decline in HEYDUDE sales.

• Achieved record gross profit, with both Crocs and HEYDUDE brands contributing, and returned $133 million to shareholders via share repurchases.

• Net loss was $492.3 million, or $(8.82) per diluted share, primarily due to $738 million in non-cash impairments related to HEYDUDE trademark and goodwill.

• Implemented $50 million in cost savings, reduced inventory receipts, and limited promotions to protect brand health amid a cautious U.S. consumer environment.

• Liquidity remains strong with $201 million in cash and $784–799 million in revolver capacity.

Financial highlights

• Q2 2025 revenues: $1,149.4 million (+3.4% year-over-year); Crocs brand $960 million (+5%), HEYDUDE $190 million (-3.9%).

• Adjusted gross margin was 61.7% (up 30 bps year-over-year); adjusted operating margin 26.9% (down 240 bps); adjusted diluted EPS $4.23 (up 5.5%).

• Free cash flow for Q2 was $269 million.

• Inventory at quarter-end was $405 million, up 7% year-over-year, partly due to tariffs.

• Repurchased 1.3 million shares for $133 million; $1.1 billion remains on buyback authorization.

Outlook and guidance

• No full-year guidance reinstated due to uncertainty, but Q3 2025 revenues expected to decline 9–11% year-over-year.

• Adjusted operating margin for Q3 expected at 18–19%, including a 170 bps tariff impact.

• Management expects continued pressure on discretionary spending due to elevated interest rates, inflation, and tariffs.

• Ongoing cost-saving actions and focus on maintaining net leverage within 1x-1.5x.