Crocs, Inc., owner of the Crocs and HeyDude brands, posted consolidated revenues of $939 million in the first quarter, an increase of 6.2 percent, or 6.9 percent on a constant-currency (CC) basis.

  • Direct-to-consumer (DTC) revenues grew 11.8 percent (+12.3 percent CC).
  • Wholesale revenues grew 3.2 percent (+4.1 percent CC).

Brand Summary

Crocs Brand revenues increased 14.6 percent (+15.6 percent) to $744 million.

  • DTC revenues increased 18.3 percent (+19.0 ) to $282 million.
  • Wholesale revenues increased 12.5 percent (+13.8 percent ) to $462 million.
  • North America revenues increased 9.0 percent to $383 million.
  • International revenues increased 21.3 percent (+23.6 percent) to $361 million.

HeyDude Brand revenues decreased 17.2 percent to $195 million.

  • DTC revenues decreased 11.0 percent to $60 million.
  • Wholesale revenues decreased 19.7 percent to $135 million.

Income Statement
Gross margin was 55.6 percent of revenues in the first quarter, compared to 53.9 percent in the prior-year Q1 period.

  • Adjusted gross margin improved 180 basis points to 56.0 percent of revenues in Q1, compared to 54.2 percent in Q1 2023.

Selling, general, and administrative expenses (SG&A) of $296 million increased 22.5 percent year-over-year from $241 million in Q1 2023, and represented 31.5 percent of revenues.

  • Adjusted SG&A of $271 million increased 16.3 percent year-over-year from $233 million in Q1 2023, and represented 28.8 percent of revenues.

Income from operations amounted to $226 million in Q1, decreasing 3.6 percent from $235 million in Q1 2023, resulting in operating margin of 24.1 percent of revenues for the 2024 Q1 period.

  • Adjusted income from operations amounted to $255 million, increasing 3.1 percent year-over-year from $247 million in Q1 2023, resulting in adjusted operating margin of 27.1 percent of revenues.

Diluted EPS was $2.50 per share in the first quarter, a 4.6 percent increase from $2.39 per share in the year-ago Q1 period.

  • Adjusted diluted earnings per share of $3.02 increased 15.7 percent from $2.61 per share in Q1 2023.

“We delivered an exceptional first quarter, led by mid-teens growth of our Crocs Brand, driven by robust consumer demand both in North America and in international markets.” said Andrew Rees, CEO, Crocs, Inc. “Our record revenue, industry-leading gross margins and the power of our diversified business enabled us to raise our full-year adjusted diluted earnings per share outlook.”

Balance Sheet and Cash Flow
(March 31, 2024 as compared to March 31, 2023)

  • Cash and cash equivalents were $159 million compared to $126 million.
  • Inventories were $392 million compared to $476 million.
  • Total borrowings were $1,727 million compared to $2,283 million.
  • Capital expenditures were $16 million compared to $28 million.

Financial Outlook
“As we continue to prioritize brand health in the North American market for HeyDude, and considering what we are seeing quarter-to-date, we are reducing our revenue expectations for the brand for the balance of the year. We are confident in the long-term opportunity for the HeyDude brand and are excited to welcome a new HeyDude President to fully unlock its future potential,” stated Rees.

Second Quarter 2024
With respect to the second quarter of 2024, CROX is forecasting:

  • Revenues to be up 1 percent to 3 percent compared to second quarter 2023, at currency rates as of the end of the last reported period.
    • Crocs Brand revenues to grow 7 percent to 9 percent compared to second quarter 2023.
    • HeyDude Brand revenues to contract in the high teens, or a range of -19 percent to -17 percent compared to second quarter 2023.
  • Adjusted operating margin of approximately 26.5 percent.
  • Adjusted diluted earnings per share of $3.40 to $3.55 per share.

Full Year 2024
For the full-year 2024 Crocs Inc. expects:

  • Revenue growth of 3 percent to 5 percent compared to 2023, at currency rates as of the end of the last reported period.
    • Revenues for the Crocs Brand to now grow approximately 7 percent to 9 percent.
    • Revenues for the HeyDude Brand to now contract between -10 percent and -8 percent.
  • Adjusted operating margin of approximately 25 percent of revenues.
  • Non-GAAP adjustments of approximately $28 million related to the implementation of a new enterprise resource planning (ERP) system for HeyDude, and costs to transition to our new HeyDude distribution center in Las Vegas, NV.
  • Combined GAAP tax rate of approximately 21.5 percent and non-GAAP effective tax rate of approximately 18.0 percent.
  • Adjusted diluted EPS of $12.25 to $12.73 per share. Adjusted diluted earnings per share guidance does not assume any impact from potential future share repurchases. As of March 31, 2024, the company had $875 million remaining on its current share repurchase authorization.
  • Capital expenditures of approximately $120 million to $130 million.

Image courtesy Crocs