Adjusted diluted EPS rose 5% to $4.23, supported by strong free cash flow of $269 million, enabling share repurchases and debt repayment.
Adjusted gross margin improved by 30 basis points to 61.7%, with Crocs Brand margin flat at 64.1% and HEYDUDE margin up 110 basis points to 50.2%.
Adjusted operating margin declined 240 basis points to 26.9%, driven by increased SG&A expenses and a $737 million noncash impairment charge on HEYDUDE intangible assets.
Crocs reported Q2 2025 revenues of $1.1 billion, up 3% year-over-year, with Crocs Brand revenues increasing 4% to $960 million and HEYDUDE revenues declining 4% to $190 million.
Inventory increased 7% to $405 million, partly due to elevated tariff costs, while net leverage remained at the lower end of the target range of 1x to 1.5x.
Footwear revenue declined 14% due to portfolio optimization and softer demand; apparel declined 1%, accessories grew 8%.
Gross margin improved by 70 basis points to 48.2%, driven by favorable currency, pricing benefits, and product mix, partially offset by channel mix and supply chain headwinds.
Inventory increased 2% to $1.1 billion; cash balance rose to $911 million following a $400 million senior notes issuance.
Operating income was $3 million, with adjusted operating income of $24 million after excluding restructuring and transformation charges.
Reported diluted loss per share was $0.01, adjusted diluted EPS was $0.02.
Under Armour reported Q1 2026 revenue of $1.1 billion, down 4% year-over-year, with regional declines in North America (-5%), APAC (-10%), and Latin America (-15%), while EMEA grew 10%.
Adjusted EBITDA for Q2 was $58 million, down 9.3% from last year, primarily due to the frozen and vegetables business unit.
Adjusted net income was $2.9 million or $0.04 per share, down from $6.6 million or $0.08 per share last year.
Gross profit was $87 million or 20.5% of net sales; adjusted gross profit was $89.1 million or 21%.
Net cash from operations was $17.8 million in Q2 2025, up from $11.3 million in Q2 2024; year-to-date cash flow was $70.6 million versus $46.4 million last year.
Net debt reduced to $1.957 billion at quarter end, pro forma net debt after Le Sueur sale was just over $1.9 billion.
Q2 net sales were $424.4 million, down 4.5% year-over-year, with base business net sales down 4.2%.
Segment adjusted EBITDA declined by $6.5 million in frozen and vegetables due to higher true-up costs, trade spend, and the end of Walmart rollback.
Selling, general and administrative expenses increased 9.4% to $47.2 million, driven by higher marketing and divestiture-related expenses.
Specialty business unit net sales declined 8% mainly due to lower Crisco oil pricing, but segment adjusted EBITDA improved by 3%.