Williams Trading analyst Sam Poser has reduced estimates for Crocs Inc. ahead of the shoe firm’s fourth quarter earnings report on Thursday.
The Wall Street consensus is adjusted diluted earnings per share (EPS) at $1.91 on revenue of $917.1 million. Poser believes Crocs’ EPS will be within company guidance, but still miss the current consensus estimates.
When Crocs reported third quarter results on Oct. 30, the company estimated fourth quarter EPS in the range of $1.82 to $1.91.
Poser estimated that fourth quarter revenue for the Crocs brand could be down 3.2 percent, with Hey Dude revenue down 25.0 percent.
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Based on proprietary checks at retail, Poser concluded: “Fiscal Year ’26 guidance is likely to be cautious, below consensus estimates, and not necessarily conservative.”
The Williams Trading analyst believes that sales in North America for both the Crocs and Hey Dude brands for Fiscal Year ’26 are likely to “remain challenged.”
He is forecasting Hey Dude sales to be down double-digits, on top of a double-digits decline in Fiscal Year ’25. Poser believes Crocs sales will be down low-single digits, with weak sales in North America offset by growth in international markets. He also expects tariffs will remain a headwind through the second quarter of ’26, although foreign exchange tailwinds should provide a partial offset.
According to Poser, one of the issues for the brand is that he sees waning demand in the U.S. One possible reason is that U.S. consumers continue to gravitate to athletic brands and Birkenstock, “which offer more comfort, are more expensive than Crocs (and Hey Dude), and offer a better price/value proposition,” the analyst concluded.
Poser also said that Crocs pricing hasn’t been consistent across channels, and therefore the brand wasn’t able to drive full-price selling. Also, the analyst said the brand has become “too reliant” on collaborations. Some, such as the one with South Park, offered compelling product, but had too many pairs placed in the market, resulting in markdowns. Other collaborations last year include one with Hello Kitty, Bape (Japanese streetwear brand A Bathing Ape), and Haribo.
A new Crocs collaboration for 2026 is Crocs x Lego, which is set to be released on Feb. 16 and priced at $150. But Poser noted that even if the Brick Clog from the collaboration does well, it won’t be enough to move the needle. The analyst said the core Crocs product continues to need a refresh, and a narrower number of stock-keeping units (SKUs). “Over the past few months, the number of colorways of the Classic Clog has been reduced from over 35 to 25, which is still too much,” Poser concluded.
At Hey Dude, Poser said he continues to see ongoing issues for the brand. “Almost every retailer with whom we have spoken is planning Hey Dude down double-digits in fiscal year 2026,” he noted. “The brand remains meaningful, but there are few new items out there that will move the needle. As with Crocs, Hey Dude is losing share more [to] athletic brands.”
Williams Trading’s proprietary checks indicate that over 40 percent of Hey Dude SKUs within the family footwear channel are being discounted.
One plus at Hey Dude is the parent firm’s elevation of Rupert Campbell as executive vice president and brand president of Hey Dude in November. Campbell, a former Adidas executive, joined the brand last March as senior vice president and chief commercial officer. Campbell’s role gives him oversight for leading the brand’s product, marketing and commercial go-to market strategy.
According to Poser, supply chain efficiencies are expected to drive operating leverage in Fiscal Year ’26, but that could be harder to achieve if revenue growth is negative in the quarter. Cost-cutting initiatives are expected to drive $100 million in savings from vendors, factories and other services.
