American footwear company Caleres has posted a consolidated net sales of $658.5 million in the second quarter (Q2) of fiscal 2025 (FY25) ended August 2, down 3.6 per cent year-over-year (YoY). The decline was driven by a 4.9 per cent fall in Famous Footwear sales and a 3.5 per cent drop in the Brand Portfolio segment. Comparable sales at Famous Footwear slid 3.4 per cent, although trends improved meaningfully in July.

The direct-to-consumer (DTC) channels accounted for approximately 75 per cent of total net sales, highlighting the company’s continued focus on consumer-centric growth. The gross profit came in at $285.8 million, translating to a gross margin of 43.4 per cent, down 210 basis points (bps) YoY, pressured by tariff-related costs, selective promotions, and higher inventory markdown provisions, Caleres said in a press release.

Caleres has reported net sales of $658.5 million in Q2 FY25, down 3.6 per cent YoY, with Famous Footwear and Brand Portfolio sales declining 4.9 and 3.5 per cent, respectively.
Gross margin fell 210 bps to 43.4 per cent, and net income dropped to $6.7 million.
The company achieved $15 million in annualised cost savings and completed the Stuart Weitzman acquisition.

Segment-wise, Famous Footwear posted a gross margin of 43.7 per cent, down 130 bps, while Brand Portfolio margins fell 240 bps to 40.3 per cent. Selling, general and administrative (SG&A) expenses rose to $269.7 million, or 41 per cent of sales, up 170 bps due to deleverage from lower revenue.

The net income of the company fell sharply to $6.7 million, with diluted earnings per share (EPS) at $0.2, and adjusted net earnings stood at $11.7 million, or $0.35 per diluted share, both benefitting from a discrete tax gain of $0.07 per share.

Quarter-end inventory was $693.3 million, up 4.9 per cent YoY, reflecting tariff-related stocking and preparations for the Stuart Weitzman acquisition. Borrowings under the revolving credit facility rose to $387.5 million, an increase of $241 million from the prior fiscal, partly to support this acquisition.

To strengthen liquidity, Caleres amended its credit agreement, extending the maturity of its asset-based revolving credit facility and increasing borrowing capacity. The company also achieved annualised cost savings of $15 million through structural efficiencies.

Shortly after the quarter’s close, Caleres completed its acquisition of Stuart Weitzman, enhancing its Brand Portfolio with a globally recognised luxury footwear label, added the release.

“While we did experience headwinds due to market uncertainty, we demonstrated the strength and resilience of our company this quarter. Sales trends improved sequentially in both segments of our business, and we saw market share gains in women’s fashion footwear and in shoe chains. We experienced strength in Lead Brands, our Brand Portfolio direct-to-consumer channels, and international. We also saw significant improvement in sales trends at Famous Footwear in July and continuing through August,” said Jay Schmidt, president and chief executive officer (CEO) at Caleres.

“As we look to address the changes in the operating environment, we completed our previously announced structural cost savings initiatives that will deliver annualized savings of $15 million and support a more efficient operating structure. Just after quarter-end, we completed the acquisition of Stuart Weitzman, adding a new Lead Brand to our portfolio that aligns with our strategic focus on premium, direct-to-consumer, and international business,” added Schmidt. “Longer term, we will continue looking for ways to leverage our greatest capabilities across our portfolio, and we are confident in our ability to execute our strategic plan, invest to fuel our growth initiatives, and drive sustained value for our shareholders.”

The company continues to withhold annual guidance due to macroeconomic uncertainty. For August, Famous Footwear same-store sales rose 1 per cent, while Brand Portfolio sales excluding Stuart Weitzman increased in the low-single digits. Management anticipates persistent tariff-driven pressure on Brand Portfolio gross margins in the third quarter, similar to Q2, with improvement expected in Q4 as mitigation measures take effect.

Fibre2Fashion News Desk (SG)

Dior’s Shanghai branch has been accused by Chinese authorities of illegally transferring customer personal data to its headquarters in France, resulting in a data leak in May, according to a statement from China’s public security authority.

Officials stated that Dior failed to conduct the required data security assessments, did not notify users, and did not encrypt the data before transferring it overseas. The local public security authority imposed an administrative penalty on the firm, according to the statement. The company did not immediately respond to a Reuters request for comment.

The enforcement comes just months after Dior disclosed a separate data breach in May that compromised customer information in China and South Korea. The breach, which involved unauthorized access to databases, included contact and purchase information—but no financial details were affected, according to Dior’s previous disclosures.

FashionNetwork.com with Reuters