Wolverine World Wide (WWW) Q1 2025 earnings summary

Executive summary

• Achieved strong Q1 2025 results with revenue, margin, and EPS exceeding expectations, driven by robust performance in Saucony and Merrell, and improved profitability in Sweaty Betty despite a revenue decline; business stabilized and portfolio rationalized, exiting low-margin sales and improving profitability.

• Revenue for Q1 2025 increased to $412.3 million, up 4.4% year-over-year (5.5% for ongoing business), with net earnings of $11.1 million compared to a net loss in Q1 2024.

• Gross margin reached a record 47.3%, up from 45.9% year-over-year, and adjusted diluted EPS rose to $0.18 from $0.05, with net debt reduced by $83–$84 million year-over-year.

• Completed divestitures of the Sperry business and Merrell/Saucony China joint ventures in early 2024, and transitioned Merrell and Saucony kids business to a licensing model.

• Strategic focus on brand health, inventory management, and disciplined distribution contributed to performance.

Financial highlights

• Q1 2025 revenue was $412.3 million, up 4.4% year-over-year (5.5% for ongoing business), surpassing the $395 million outlook, with constant currency growth of 6.7%.

• Adjusted gross margin was 47.3%, up 80–140 basis points year-over-year; adjusted operating margin was 6.0%, up 100 basis points.

• Adjusted diluted EPS was $0.18, up 260% year-over-year; diluted EPS was $0.13, up from a loss per share of $0.19 last year.

• Inventory at quarter-end was $271 million, down $83–$84 million (23.6%) year-over-year; net debt at $604 million, down $80–$84 million year-over-year.

• Operating profit was $19.7 million, a turnaround from an operating loss of $3.1 million in Q1 2024.

Outlook and guidance

• Withdrew full-year 2025 guidance due to tariff and macroeconomic uncertainty, but provided Q2 guidance: revenue of $440–$450 million (up 3.7%–6.0% YoY), adjusted operating margin of ~7.2%, and adjusted EPS of $0.19–$0.24.

• Tariff impact expected to be more significant in the second half of 2025; Q2 impact minimal.

• Management expects current seasonal sales patterns to continue and anticipates cash flow from operations will be sufficient to meet working capital needs.