Wolverine World Wide 2025 Q1 Earnings Strong Turnaround as Net Income Swings 189.1%

Wolverine World Wide (WWW) reported its fiscal 2025 Q1 earnings on May 08th, 2025. The company posted a 4.4% increase in total revenue, reaching $412.30 million compared to $394.90 million in the same quarter last year. Wolverine World Wide's CEO emphasized the company's strategic focus on product quality and operational execution. The outlook for the second quarter anticipates continued revenue growth with a forecasted range of $440 million to $450 million.

Revenue

Wolverine World Wide reported a 4.4% increase in total revenue for Q1 2025, amounting to $412.30 million. The Active Group emerged as the strongest segment, generating $326.70 million. The Work Group contributed $74.80 million, while the Other segment added $10.80 million. The Corporate segment recorded no revenue, culminating in a total of $412.30 million for the quarter.

Earnings/Net Income

Wolverine World Wide returned to profitability in Q1 2025, posting an EPS of $0.13, a significant reversal from a loss of $0.19 per share in Q1 2024, marking a 168.4% improvement. The company achieved a net income of $12.20 million, reflecting a 189.1% positive swing from the previous year's net loss of $13.70 million. This turnaround suggests a strong performance in earnings per share.

Price Action

Post-Earnings Price Action Review

The strategy of buying Wolverine World Wide (WWW) shares after a quarter-over-quarter revenue drop and holding for 30 days has historically underperformed over the past five years. This strategy yielded a return of -3.55%, significantly lagging behind the benchmark's 92.56% return. The excess return was notably negative at -96.11%, with a compounded annual growth rate (CAGR) of -0.72%, indicating substantial losses. The strategy also faced a high maximum drawdown of -81.70% and a Sharpe ratio of -0.01, pointing to heightened risk and negative returns. Investors considering this approach should be cautious due to its historical underperformance and high volatility.

CEO Commentary

"Merrell and Saucony fueled our growth with double-digit revenue increases," said Chris Hufnagel, President and Chief Executive Officer of Wolverine Worldwide. He highlighted that the company tripled its earnings year-over-year and achieved record gross margin performance. Hufnagel emphasized the focus on product quality and operational execution while acknowledging the uncertainty in the marketplace. He expressed optimism about the momentum generated and confidence in the company's positioning, supported by strong global brands and a resilient team to tackle near-term challenges.

Guidance

The outlook for the second quarter anticipates revenue of approximately $440 million to $450 million, reflecting growth of about 3.7% to 6.0% compared to the second quarter of 2024. The operating margin is expected to be around 6.7%, with an adjusted operating margin projected at approximately 7.2%. Diluted earnings per share are forecasted to range from $0.17 to $0.22, while adjusted diluted earnings per share are expected between $0.19 and $0.24. The company has chosen not to provide a full-year 2025 outlook amid macroeconomic uncertainties.

Additional News

Wolverine World Wide recently announced a collaboration between its Chaco brand and Fishwife, a female-led tinned seafood company, to launch a mermaid-inspired Z/1 sandal design. This new product, featuring vibrant colors and iconic illustrations, aligns with both companies' sustainability commitments. Additionally, Wolverine has partnered with country music star Jordan Davis for a nationwide Trades Tour, supporting American skilled tradespeople, providing $100,000 in sponsorship and gear. Lastly, Wolverine declared a quarterly dividend of $0.10 per share, maintaining the previous quarter's level, with payment scheduled for August 1, 2025.