Caleres growth splits as brand portfolio outpaces Famous Footwear
Caleres lifted the low end of its full-year guidance after second-quarter earnings improved, but promotional pressure and weaker Famous Footwear demand remain significant risks.
Caleres reported second-quarter net sales of US$695.5 million, up 5.6% from a year earlier, while adjusted diluted earnings per share rose to US$0.47 from US$0.35. The footwear company also raised the low end of its full-year guidance, although it did not provide the revised range in the report reviewed by Yahoo Finance.
Growth was led by Caleres’ brand portfolio, which includes Sam Edelman, Allen Edmonds, Naturalizer, Vionic and Stuart Weitzman. Sales increased 23.6% to US$340.6 million, supported by the Stuart Weitzman integration, organic growth and stronger international sales. Adjusted gross margin expanded 880 basis points to 49.1%.
Famous Footwear delivered a contrasting result, with sales down 6.3% to US$374.4 million. The chain faced weaker demand for lifestyle athletic shoes and relied on increased promotions and clearance to adjust inventory, pushing gross margin down 100 basis points to 42.7%.
Company-wide inventory rose to US$754.2 million, including US$69 million attributed to the Stuart Weitzman acquisition. Caleres ended the quarter with US$50.9 million in cash and US$288 million in revolver borrowings, and plans to open 13 stores and close 26 this year.
Management identified a recovery in Stuart Weitzman’s China business as a major growth opportunity and is targeting breakeven for the brand in 2026. The company also cited promotional pressure, inventory adjustments and uncertainty over future tariffs as risks to results. Reported short interest stood at 11.66% of the float and the forward price-to-earnings ratio was 7.42 as of 11 September, figures that may change over time.
