Caleres navigates market uncertainty as Q2 sales decline

Caleres, a portfolio of consumer-driven footwear brands, announced its financial results for the second quarter of 2025, revealing a decline in sales but signs of improving trends. The company's consolidated sales were 658.5 million dollars, a 3.6 percent decrease compared to the previous year.

The Brand Portfolio segment sales declined by 3.5 percent, while Famous Footwear sales were down by 4.9 percent, with comparable sales decreasing by 3.4 percent. Despite the sales decline, the company reported market share gains in women’s fashion footwear and in shoe chains.

President and CEO Jay Schmidt expressed confidence in the company's resilience, noting that sales trends improved in July and August. He stated that Caleres will continue to invest in growth initiatives and aims to leverage its capabilities across the portfolio to drive sustained value for shareholders.

Gross margin was 43.4 percent, a decrease of 210 basis points, primarily due to tariff-related costs and promotions. However, this was partially offset by growth in higher-margin direct-to-consumer channels within the Brand Portfolio. Caleres reported earnings of 20 cents per diluted share and adjusted earnings of 35 cents per diluted share.

Just after the quarter ended, Caleres completed the acquisition of Stuart Weitzman, which the company views as a new "Lead Brand" that aligns with its focus on premium, direct-to-consumer, and international business. The company also enhanced its financial flexibility by amending its credit agreement, which increased its borrowing capacity by 200 million dollars to 700 million dollars.

The company will continue to suspend its annual guidance due to market uncertainty. However, it anticipates ongoing gross margin pressure in the Brand Portfolio for the rest of the year due to tariffs, with improvement expected in the fourth quarter as mitigation strategies take effect.