Crocs lifts outlook despite drop in sales

Crocs Inc. has released its financial results for the first quarter of 2026, showing a slight decline in revenue but continued strength in its direct-to-consumer (DTC) business.

Consolidated revenues totalled $921 million (£678 million), representing a 1.7% decrease year-on-year, or a 4% decline on a constant currency basis.

Despite the overall drop, the company’s DTC channel continued to grow, with revenues increasing 12.1% (10.2% on a constant currency basis).

In contrast, wholesale revenue declined 9.9% (-12.5% on a constant currency basis), reflecting ongoing pressure in traditional retail distribution.

The core Crocs brand recorded $767 million (£564 million) in revenue, up 0.8%, though down 1.9% on a constant currency basis, indicating relatively stable performance overall.

Channel trends showed divergence:

• DTC revenue rose 12.9% to $322 million (£237 million).
• Wholesale revenue fell 6.5% to $446 million (£328 million).

Geographically, performance was mixed:

• North America revenue declined 6.1% to $346 million (£254 million).
• International revenue increased 7.2% to $421 million (£309 million).

Meanwhile, the HEYDUDE brand continued to face headwinds, with revenues falling 12.3% to $154 million (£113 million), down 13.2% on a constant currency basis.

Channel breakdown highlights a sharp contrast:

• DTC revenue increased 8.6% to $71 million (£52 million).
• Wholesale revenue declined 24.7% to $83 million (£61 million).

Looking ahead, the company provided guidance for both the second quarter and full year 2026.

For Q2 2026, the company expects overall revenue to be slightly below Q2 2025 levels, with Crocs brand revenue expected to grow 1-3%, while HEYDUDE brand revenue is expected to decline 12-14%.

For the full year 2026, expectations include revenue ranging from down 1% to up 1%, with Crocs brand growth of flat to +2% and HEYDUDE declining 5-7%.

This marks a modest improvement from prior guidance, which had anticipated slightly weaker overall performance.

CEO Andrew Rees said: "We are pleased to have started the year with better-than-expected results, fuelled by broad consumer relevance for both of our brands and disciplined execution against our strategy.

"Based on our first quarter performance, we are raising our full-year outlook. We are focused on executing against our initiatives to drive diversified growth across both brands, channels, and markets, and we remain confident in the long-term health of the business."