Crocs (CROX) Q1 2026 earnings summary

Executive summary

• Q1 2026 revenue reached $921M–$921.5M, exceeding expectations despite a 1.7% year-over-year decline, driven by strong DTC growth, innovation, and new product launches across both brands.

• Crocs brand revenue was $767M (down 2%), with international growth led by China, India, Japan, and Western Europe; HEYDUDE revenue was $154M (down 12.3%–13%), but DTC grew 8%.

• Net income was $137.6M, down 14.1% year-over-year; diluted EPS was $2.71, while adjusted diluted EPS was $2.99 (flat year-over-year).

• Inventory management improved, with inventory at $398M (+2% YoY), inventory turns above 4x, and 0.8M shares repurchased for $73.6M–$74M post-Q1.

• New product introductions, collaborations, and digital engagement drove consumer interest and brand momentum.

Financial highlights

• Q1 consolidated revenue: $921M–$921.5M, down 1.7% reported and 4% constant currency year-over-year.

• Adjusted gross margin: 56.9% (down 90 bps); reported gross margin: 56.8%.

• Adjusted operating margin: 22.3% (down 150 bps); reported operating margin: 21.8%.

• Adjusted diluted EPS: $2.99 (flat YoY); diluted EPS: $2.71 (down 4.2%).

• Free cash flow for Q1: -$98.9M; cash and cash equivalents: $130.9M–$131M.

Outlook and guidance

• FY26 revenue expected to be up 1% to down 1% reported; Crocs brand flat to +2%, HEYDUDE down 7% to 5%.

• Adjusted gross margin for the year expected slightly up vs. last year; adjusted SG&A roughly flat.

• Adjusted operating margin expected above 22.3%; adjusted diluted EPS raised to $13.20–$13.75.

• Q2 revenue expected down slightly; Crocs up 1%–3%, HEYDUDE down 14%–12%; Q2 adjusted EPS $4.15–$4.35.

• Capital expenditures for 2026 projected at $70M–$80M.