US footwear company Crocs has reported consolidated revenue of $996m for the third quarter (Q3) of 2025, down 6.2% from $1.06bn a year earlier.
For the three months to 30 September 2025, operating income declined 23% to $208m from $270m, reducing operating margin to 20.8% from 25.4%.
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Net income fell to $145.8m compared with $200m in the same quarter of the previous year.
The company’s gross margin, on both a reported and adjusted basis, contracted by 110 basis points to 58.5% from 59.6% a year earlier.
Sales by channel showed contrasting trends. Direct-to-consumer (DTC) revenue edged up 1.6%, or 0.9% at constant exchange rates, while wholesale revenue dropped 14.7%, or 15.1% on a constant currency basis.
Within brand results, Crocs-branded revenue slipped 2.5% to $836m, or 3.2% in constant currency. Direct-to-consumer (DTC) sales for the brand rose 2% to $472m, or 1.2% at constant rates, while wholesale revenue decreased 7.9% to $364m, or 8.4% on a constant currency basis.
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By GlobalDataBy region for the Crocs brand, North America revenue fell 8.8% to $448m, whereas international revenue increased 5.8% to $389m, or 4.2% on a constant currency basis.
HEYDUDE brand revenue dropped 21.6% to $160m, or 21.7% on a constant currency basis. The brand’s DTC sales slipped 0.5% to $91m, or 0.7% in constant currency, and wholesale revenue fell 38.6% to $69m, or 38.7% on a constant currency basis.
During the quarter, the company bought back 2.4 million shares for $203m at an average price of $83.03 and reduced debt by $63m.
Looking to Q4 2025, the company expects overall revenue to be around 8% lower than during the same period of 2024.
It anticipates Crocs-branded revenue to decline by around 3% year-on-year, and HEYDUDE revenue to be down by the mid-20% range.
Adjusted operating margin is forecast at about 15.5%.
Separately, capital expenditure for full-year 2025 is projected between $70m and $75m.
Crocs CEO Andrew Rees stated: “The strength of our profitability and cash flow enabled us to repurchase 2.4 million of our outstanding shares and pay down $63m of debt during the quarter, both fundamental levers of our value creation model. While our results came in ahead of expectations, we believe both of our brands have greater potential, and are working to re-gain momentum in the marketplace.
“As we look forward, in addition to the $50m of gross cost savings in 2025, we have identified an incremental $100m of gross cost savings, and are committed to driving operating leverage in 2026.”
