Crocs Inc. shares jumped more than 15 percent in pre-market trading after the shoe firm bested Wall Street’s third quarter consensus estimates and raised full-year 2026 outlook.
Notably, Hey Dude revenue marked a major milestone as the brand returned to growth in the quarter.
“We delivered a strong third quarter with growth across brands, channels and geographies, while expanding margins year over year through disciplined execution of our brand strategies,” said Andrew Rees, chief executive officer, in a statement.
Rees added that the Crocs brand delivered a record third quarter with revenues up 4 percent, “led by double-digit international revenue growth and continued momentum across our product diversification strategy.” At Hey Dude, “revenues grew 6 percent, marking an important milestone as we delivered on our commitment stated earlier in the year to return the brand to growth.”
Rees also said the strength of the business model and “exceptional free-cash-flow generation” provides the company with “significant flexibility to invest behind our brands.”
During the quarter, Crocs also returned $250 million to shareholders through share repurchases, while it continued to strengthen its balance sheet through debt pay down. The company purchased 2 million shares at the average share price of $123.32. At quarter-end, approximately $1.7 billion of share repurchase authorization remained available for future repurchases, the company said. Crocs also repaid $21 million of debt.
Net income for the third quarter spiked 48.6 percent to $216.8 million, or $4.52 a diluted share, from $145.8 million, or $2.70, in the same year-ago period. Revenues rose 4.6 percent to $1.04 billion from $996.3 million. Direct-to-consumer (DTC) revenue was up 6.9 percent, while wholesale revenue rose 1.8 percent. The company also said gross margin for the quarter was 66.2 percent versus 58.5 percent a year ago.
Wall Street was expected adjusted diluted earnings per share (EPS) of $3.31 on revenue of $1 billion. Adjusted diluted EPS in the quarter ended Sept. 30 was $3.69.
By brand, Crocs revenues rose 4.4 percent to $873 million. DTC revenues rose 8.2 percent to $510 million, while wholesale revenues slipped 0.5 percent to $382 million. North America revenues fell 2.1 percent to $438 million, while international revenues rose 11.8 percent to $434 million.
At Hey Dude, revenues rose 6.1 percent to $170 million. DTC revenue inched up 0.1 percent to $91 million, while wholesale revenues increased 14.0 percent to $79 million.
For the nine months, net income was $559.2 million, or $11.32, against a net loss of $186.4 million, or $3.38, a year ago. Revenues in the period rose nearly 2 percent to $3.14 billion from $3.08 billion.
The company said it expects revenues for full year 2026 to be up 3 percent from full year 2025 levels. That’s up from prior guidance of up 1 percent o 2 percent when the firm reported second quarter results. By brand, the company forecasted Crocs revenue to be up 4 percent, versus prior guidance of up 2 percent to 3 percent. It also guided Hey Dude revenues at flat compared to year ago levels. That’s up from previous guidance of down 2 percent to 4 percent.
Crocs also guided adjusted diluted EPS for the year in the range of $14.45 to $14.65, up from the prior range of $13.70 to $14.00.
For the fourth quarter, revenues is expected to be up 7 percent to 9 percent from 2025 levels. Crocs revenues was guided to up 6 percent to 8 percent, and Hey Dude at up 10 percent to 12 percent. Adjusted diluted EPS was guided to the range of $3.25 to $3.45.
Shares of Crocs rose 15.9 percent to $138.74 in pre-marketing trading at 9:19 am.