Shares of Crocs Inc., the popular American footwear company known for its distinctive rubber clogs, have fallen nearly 30% as the firm reveals a decline in anticipated revenue. The upcoming quarterly reports suggest a 10% fall in sales compared to last year, as consumers exhibit a more cautious approach to spending. Crocs' CEO Andrew Rees indicated that many shoppers are choosing to stay away from physical stores, impacting foot traffic significantly.
The company's stock is now at its lowest in nearly three years, following the largest single-day drop in 15 years. Crocs has expressed concerns about a challenging second half of 2023, citing factors like the rising cost of living and potential fallout from US trade policies. Chief Financial Officer Susan Healy mentioned that tariffs would lead to a $40 million impact for the remaining part of the year.
In response, Rees remains optimistic about mitigating tariff impacts through cost-saving measures in their supply chain. However, he acknowledged a "super cautious" segment of their customer base, resulting in lower store visits and purchases. Crocs is also reducing discounting efforts, which may further influence sales figures.
Despite these challenges, Crocs recently reported a revenue rise of 3% in the second quarter, amounting to $1.1 billion. As major sporting events loom, including the upcoming football World Cup and the Los Angeles Olympics, Rees noted a trend of consumers leaning back toward athletic footwear products.
