SHOO — Steven Madden, Ltd.

Summary of Steven Madden Limited Q1 2026 Earnings Call

1. Key Financial Results and Metrics

• Consolidated Revenue: $653.1 million, an 18% increase year-over-year. Excluding Kurt Geiger, revenue decreased by 4.8%.
• Wholesale Revenue: $443.6 million, up 1% YoY; down 8.2% excluding Kurt Geiger.
• DTC Revenue: $206 million, an 83.8% increase YoY; 8% increase excluding Kurt Geiger.
• Gross Margin: 46.3%, a 540 basis point improvement YoY.
• Operating Income: $46.3 million (7.1% of revenue), down from $56.1 million (10.1% of revenue) in Q1 2025.
• Net Income: $32.1 million ($0.45 per diluted share), compared to $42.4 million ($0.60 per diluted share) in Q1 2025.
• Debt: $286.5 million with $77.2 million in cash, resulting in net debt of $209.3 million.
• Dividend: Quarterly cash dividend of $0.21 per share announced.

2. Strategic Updates and Business Highlights

• Brand Performance: Strong demand for the Steven Madden brand, particularly in casuals, dress shoes, and boots. Online searches increased by 27%.
• Kurt Geiger: Revenue increased 23% on a pro forma basis. New store openings planned in the U.S. and international expansion into India.
• Dolce Vita: High single-digit revenue growth expected, with strong performance in spring assortments.
• Marketing Initiatives: Increased investment in marketing to 5.3%-5.4% of revenue, focusing on omnichannel strategies and social media.

3. Forward Guidance and Outlook

• Revenue Growth: Raised guidance to 10%-12% for 2026, up from 9%-11%.
• EPS Guidance: Expected in the range of $2.00 to $2.10 for the year.
• Earnings Recovery: Anticipated return to earnings growth in Q2 2026, driven by strong underlying demand.

4. Bad News, Challenges, or Points of Concern

• Decline in Organic Revenue: Driven by softness in private label and lower handbag sales in the U.S. wholesale channel.
• Increased SG&A Expenses: Operating expenses rose to $256 million (39.2% of revenue) due to the addition of Kurt Geiger and higher incentive compensation.
• Impact of Tariffs: Uncertainty regarding tariffs remains a concern, with expectations of 10% tariffs continuing through July and a potential increase to 15% thereafter.
• Middle East Operations: Significant revenue decline (approximately 40% down) due to regional conflicts, with an estimated $9-$10 million impact on revenue for 2026.

5. Notable Q&A Insights

• Revenue Guidance Drivers: Increased expectations for Kurt Geiger and modestly raised forecasts for Steven Madden and Dolce Vita based on strong spring performance.
• Private Label Conversations: Ongoing discussions with private label customers are productive, but the tariff situation remains uncertain.
• DTC Business Trends: Continued strength in DTC, although growth may not be as robust due to anniversarying Kurt Geiger.
• Apparel Business: Positive sell-through trends noted, with potential for comparable margins to footwear in the long term.
• Kurt Geiger EBIT Margins: Expected to improve by 100 basis points in 2026, with a long-term goal of reaching double-digit margins.

This summary encapsulates the key points from the earnings call, highlighting both the positive developments and the challenges faced by Steven Madden Limited in Q1 2026.