0001628280-26-032774
SEC filingRevenue up 18% to $653M driven by Kurt Geiger acquisition and $55M IEEPA tariff refund boosting gross margin.
For the three months ended March 31, 2026, total revenue increased 18.0% to $653.1 million from $553.5 million in the prior year period. The growth was primarily driven by the acquisition of Kurt Geiger, which contributed incremental revenue across all segments. Gross profit rose to $357.4 million (54.7% of revenue) compared to $226.3 million (40.9% of revenue) in the prior year. The 1,380 basis point expansion in gross margin was largely due to a $55.1 million benefit from the expected IEEPA tariff refund, higher average selling prices, and a lower penetration of private label business, partially offset by the addition of Kurt Geiger's lower-margin mix. Operating expenses increased to $258.3 million (39.5% of revenue) from $177.3 million (32.0% of revenue), reflecting higher incentive compensation, warehouse expenses, and costs from Kurt Geiger, as well as $1.2 million in severances, $0.8 million in legal costs, and $0.3 million in acquisition-related costs. Income from operations improved to $98.7 million (15.1% of revenue) from $53.5 million (9.7% of revenue). Net income attributable to Steven Madden, Ltd. was $71.8 million, or $1.00 per diluted share, compared to $40.4 million, or $0.57 per share, in the prior year period.
Wholesale Footwear revenue decreased 5.8% to $278.9 million, primarily due to a decline in the private label business, partially offset by incremental revenue from Kurt Geiger. Gross margin improved to 48.8% from 36.7%, driven by a $28.3 million IEEPA tariff benefit and higher average selling prices. Operating margin rose to 28.8% from 21.3%.
Wholesale Accessories/Apparel revenue grew 15.1% to $164.8 million, aided by Kurt Geiger. Gross margin expanded to 49.9% from 33.6%, benefiting from a $16.2 million IEEPA tariff benefit, higher prices, and mix shift. Operating margin increased to 26.7% from 15.7%.
Direct-to-Consumer revenue surged 83.8% to $206.0 million, driven by Kurt Geiger and strong performance in the Steve Madden full-price U.S. business. Gross margin improved to 65.9% from 60.1%, reflecting a $10.6 million IEEPA benefit and Kurt Geiger mix. Operating loss improved to -$1.6 million (-0.8% of revenue) from -$6.2 million (-5.6% of revenue).
Licensing income increased to $3.4 million from $2.2 million, with operating income of $3.2 million.
Management highlighted a dynamic macroeconomic environment with uncertainties from tariffs, interest rates, and geopolitical tensions. Key strategic initiatives include product innovation, marketing investment, international expansion, non-footwear growth, digital DTC expansion, cost management, and sustainability. No specific quantitative guidance was provided. The company maintains a strong liquidity position with $77.2 million cash and a $250 million revolving credit facility, and declared a $0.21 quarterly dividend.
As of March 31, 2026, cash and cash equivalents stood at $77.2 million, down from $112.4 million at year-end 2025, primarily due to debt repayments and dividends. Short-term investments were nil. Total debt increased to $286.5 million, net of $52.3 million in new revolver borrowings after $42.0 million in repayments. The term loan of $240.0 million net of unamortized costs remains stable. Total stockholders' equity grew to $947.2 million (including noncontrolling interest of $34.1 million), driven by net income of $71.6 million partially offset by dividends and share repurchases for tax withholdings.
The company has a license agreement requiring minimum royalty and advertising payments of $34.5 million as of March 31, 2026, with the agreement extended through 2031. Additionally, there were $0.5 million in letters of credit outstanding (unrelated to the credit facility). Operating lease liabilities total $253.8 million, with near-term payments of $56.5 million in the remaining nine months of 2026.
Buyback activity was limited to tax withholding settlements of $7.4 million (187,000 shares at ~$39.39 per share); no open market repurchases were conducted under the program, leaving $85.3 million of authorization remaining. Dividends of $15.3 million were paid at $0.21 per share, consistent with the prior year. Capital expenditures totaled $5.9 million, down from $9.8 million in Q1 2025, with the majority allocated to Direct-to-Consumer ($4.2 million) reflecting retail investments.
Segment revenue for Q1 2026: Wholesale Footwear $278.9 million (-5.8% YoY), Wholesale Accessories/Apparel $164.8 million (+15.1%), Direct-to-Consumer $206.0 million (+83.9% driven by Kurt Geiger), and Licensing $3.4 million (+59.7%). Operating margins were 28.8%, 26.7%, -0.8%, and 92.5% respectively. Geographically, domestic revenue was $425.1 million (65.1%) and international $228.0 million (34.9%), with international share rising from 18.6% in Q1 2025 due to the Kurt Geiger acquisition.