STEVEN MADDEN, LTD. Q1 FY2025 earnings call

• Strong Q1 performance in a tough environment with March showing improvement due to spring fashion. Product teams created on-trend assortments and used full funnel marketing. - Moved production out of China to other countries to mitigate tariff impacts, aiming for mid-teens China sourcing for fall 2025 and mid-single digits by spring 2026. - Selectively raised prices, completed a reduction in force for $12M annual savings. - Acquired Kurt Geiger, which had £400 million revenue in 12 months ended Feb 1, 2025, and is being integrated to support its growth as a $1 billion brand.

Consolidated revenue for Q1 2025 was $553.5 million, a 0.2% increase compared to Q1 2024. Wholesale revenue was $439.3 million, up 0.2%; wholesale footwear revenue was $296.1 million, a 0.2% increase; wholesale accessories and apparel revenue was $143.2 million, up 0.4%. Direct-to-consumer revenue declined 0.2% to $112.1 million. Consolidated gross margin was 40.9%, with wholesale gross margin at 35.7% (up from 35.1% in Q1 2024) and direct-to-consumer gross margin at 60.1% (down from 61.9% in Q1 2024). Operating income for the quarter was $56.1 million or 10.1% of revenue. Net income attributable to Steve Madden Limited was $42.4 million or $0.60 per diluted share compared to $47 million or $0.65 per diluted share in Q1 2024.

Due to uncertainty related to the impact of new tariffs on goods imported into the United States, Steve Madden withdrew the 2025 financial guidance provided on February 26, 2025, and will not be providing guidance at this time.

• Impact of new tariffs on US imports, including potential revenue loss from cancellations and longer lead times. - Longer lead times due to production diversification and supply chain disruptions. - Margin pressure from higher costs in alternative sourcing countries and uncertainty around consumer demand.

Q: On aggressive moves outside China, handling orders from China, and production moving countries.

A: Ed Rosenfeld said they are taking near-completed China production with price concessions, moving components to other countries, and focusing on countries like Cambodia, Vietnam, Mexico, Brazil for faster lead times and less tariff risk.

Q: On gross margins, FX, and direction.

A: Ed Rosenfeld mentioned March's better performance, mix benefit from branded vs private label, and that tariffs will have a more significant impact in Q2.

Q: On Kurt Geiger acquisition, sourcing mix, and margins.

A: Ed Rosenfeld stated Kurt Geiger has 80% sourcing from China, priority to reduce that, and uncertainty on margin recovery timeline