Steven Madden (SHOO) Q3 2024 earnings summary

Executive summary

• Q3 2024 revenue rose 13% year-over-year to $624.7M, driven by accessories, apparel, international, and direct-to-consumer channels, with handbags and the Almost Famous division contributing significantly.

• Net income attributable to Steven Madden, Ltd. was $55.3M ($0.77 per diluted share), down from $64.4M ($0.87) last year; adjusted net income was $64.8M ($0.91).

• Gross margin declined to 41.5% (adjusted 41.6%) from 42.1% last year, impacted by the Almost Famous acquisition.

• Operating expenses increased to 28.6% of revenue, reflecting higher payroll, marketing, and e-commerce investments.

• Significant events included the launch of a global marketing campaign, GREATS® divestiture, and impairment of the Almost Famous trademark.

Financial highlights

• Consolidated Q3 revenue was $624.7M, up 13% year-over-year; excluding Almost Famous, revenue grew 5.5%.

• Wholesale revenue rose 14.4% to $495.7M; excluding Almost Famous, up 4.8%.

• Wholesale accessories and apparel revenue increased 54.2% (21.6% excluding Almost Famous); handbags up 27%.

• Direct-to-consumer revenue grew 7.8% to $125.5M; e-commerce outperformed brick-and-mortar, and gross margin in this channel improved to 64%.

• Net income for Q3 was $55.3M ($0.77 per diluted share); adjusted net income was $64.8M ($0.91).

Outlook and guidance

• Fiscal 2024 revenue expected to increase 13%-14% over 2023; diluted EPS forecasted at $2.36–$2.41, adjusted diluted EPS at $2.62–$2.67.

• International revenue on track for mid-teens % growth; EMEA expected up over 20% for 2024.

• DTC revenue projected to grow high single digits for the year.

• Management expects ongoing macroeconomic and geopolitical headwinds, including inflation, high interest rates, and global conflicts, to impact consumer demand and supply chain costs.

• Strategic focus remains on product diversification, digital expansion, sustainability, global market penetration, and operational efficiency.