Steven Madden's Q4 2024: Unpacking Contradictions in Margins, DTC Sales, and Acquisition Strategy

These are the key contradictions discussed in Steven Madden's latest 2024Q4 earnings call, specifically including: Gross Margin Pressure, DTC Sales Growth, Kurt Geiger Acquisition Strategy, and Tariff Impact on Gross Margins:



Revenue and Earnings Growth:
- Steven Madden, Ltd. reported revenue of $582.3 million for Q4 2024, up 12% compared to Q4 2023, and a 15% increase in revenue for the full year.
- The growth was driven by strong performance in international markets and within accessories and apparel divisions.

International Market Expansion:
- International revenue grew 12% in 2024 compared to the prior year, with significant gains in EMEA, South Africa, and the Americas.
- Expanding business through joint ventures and transitions to ownership models contributed to this growth.

Accessories and Apparel Growth:
- Overall accessories and apparel revenue increased 53%, with the Steve Madden handbag business crossing $300 million in revenue for the first time.
- This growth was supported by strong demand for Steve Madden handbags and apparel, as well as the performance of the Almost Famous division.

Challenges and Strategic Initiatives:
- The company faces challenges from new tariffs and inventory pressures in handbag accessories, which will impact 2025 earnings.
- The acquisition of Kurt Geiger is seen as a strategic move to add a powerful growth engine, which is expected to contribute to future growth and synergies.

Direct-to-Consumer Performance:
- Direct-to-consumer (DTC) revenue was $550 million, up 9% year-over-year, with growth in both Steve Madden and Dolce Vita brands.
- The performance was attributed to successful marketing campaigns and the expansion of DTC channels.