Crocs Inc CROX reported second-quarter FY23 sales growth of 11.2% year-on-year to $1.07 billion, beating the analyst consensus of $1.04 billion.
On a constant currency basis, DTC grew 26%, and wholesale grew 0.2%.
Crocs Brand North America revenues totaled $474.6 million, up 12.2% Y/Y. Crocs Brand's Asia Pacific revenues jumped 33.2%, and EMEALA revenues declined 0.2%.
HEYDUDE Brand DTC revenues grew 29.7% and digital revenues increased 36.7% as compared to 2022.
The gross margin expanded 630 basis points to 57.9%, while the adjusted gross margin improved 290 basis points to 58.1%.
Selling, general and administrative expenses increased 21.2% to $302.8 million.
Income from operations rose 28.4% to $318.5 million, and the operating margin was 29.7% versus 25.7% a year ago due to higher gross margin and significantly less HEYDUDE acquisition expenses.
The company held $166.2 million in cash and equivalents as of June 30, 2023.
Inventories decreased 7.5% Y/Y to $436.3 million.
Adjusted EPS of $3.59 beat the analyst consensus of $2.97.
Outlook: CROX raised its FY23 sales forecast to $4 billion - $4.06 billion from the prior view of $3.94 billion - $4.04 billion, against the Street view of $4.02 billion.
Crocs also raised FY23 adjusted EPS outlook to $11.83 - $12.22 (prior view $11.17 - $11.73) versus the consensus of $11.57.
It sees Q3 revenue of $1.013 billion - $1.034 billion versus the consensus of $1.06 billion. Adjusted EPS of $3.07 - $3.15 against the consensus of $3.09.
Price Action: CROX shares are trading lower by 5.06% at $113.74 in premarket on the last check Thursday.
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