Crocs store in New York City.
Michael Brochstein | SOPA Images | LightRocket | Getty Images
Crocs shares shot up more than 11% in Tuesday’s premarket after the shoemaker increased its revenue outlook for the full year and reported record first-quarter sales.
CEO Andrew Rees said demand for the Crocs brand is “stronger than ever” across the world. Some have called Crocs the “it” shoe of the pandemic, as the clog became a closet staple for consumers seeking comfort at home. But it had seen momentum growing even before Covid, thanks to popular collaborations and limited-edition drops with celebrities including Justin Bieber, Post Malone and Priyanka Chopra.
Here’s how the shoemaker did for its quarter ended March 31, compared with what analysts were anticipating, using data from a Refinitiv survey:
- Earnings per share: $1.49 adjusted vs. 89 cents expected
- Revenue: $460.1 million vs. $415 million expected
Crocs’ first-quarter net income grew to $98.4 million, or $1.47 per share, compared with $11.1 million, or 16 cents per share, a year earlier. Excluding one-time adjustments, the company earned $1.49 a share, solidly outpacing the 89 cents that analysts surveyed by Refinitiv were anticipating.
Revenues grew a whopping 64% to $460.1 million from $281.2 million a year earlier. That topped Street expectations for $415 million.
Crocs said its digital sales surged 75.3% to represent 32.3% of revenue, compared with 30.1% in the year-earlier period.
Direct-to-consumer sales from its stores or website grew 93.3% to $170.1 million. Wholesale revenues were up 50.1% year over year to $290 million. During a post-earnings conference call, management said Crocs recently decided to cut ties with some of its wholesale partners in North America, though it didn’t name names, in order to keep tighter control over its brand.
“Looking forward, we remain focused on strategically important accounts comprised of leading e-tailers, sporting goods and family footwear and specialty footwear retailers,” Rees said.
For the second quarter, Crocs is now calling for sales to grow by 60% to 70% year over year. Analysts had been looking for growth of 39.2%, according to Refinitiv.
For the year, it now expects sales to be up 40% to 50%. In February, its guidance for revenue growth was 20% to 25%. Analysts had been calling for a 25% increase.
While Crocs said it’s seeing strong and continued momentum in the Americas, it sees the biggest long-term growth opportunity in Asia, which it says is the second-largest footwear market in the world.
It continues to experiment with new designs that build on its classic clog, including platform Crocs for women. The company also told analysts and investors Tuesday it will be launching more sandals. Sandals sales were up 17% in the first quarter, and the company said they will one day outpace growth of its core clogs.
Over the past 12 months, Crocs shares have rallied more than 260%, making it one of the best-performing stocks in the retail industry during the health crisis. It has a market cap of $5.5 billion.