"While the COVID-19 pandemic continues to have a negative impact on our business, we were pleased to deliver third quarter revenue and earnings that significantly exceeded our expectations. The swift actions we took to address the rapidly changing marketplace – adjusting our merchandise mix, accelerating our digital commerce initiatives and right-sizing our expense structure – have positioned us to continue to navigate the crisis and also to capitalize on market share opportunities going forward. We remain confident that our strong brands, pristine balance sheet and proven business model will enable us to drive sustainable revenue and earnings growth as conditions normalize", commented Edward Rosenfeld, Chairman and Chief Executive Officer.

During a conference call on the company’s third-quarter results, the Chairman and Chief Executive Officer, Edward Rosenfeld underlined we are living a "period of rapidly changing consumer preferences" which is reflected in growing categories like slippers and slides while reducing the penetration of down-trending categories like dress shoes.

Third Quarter Review

Steve Madden revenue decreased by 30.9% to 346.9 million US dollars compared to 502.1 million US dollars in the same period of 2019. Operating expenses as a percentage of revenue were 31.7% compared to 25.5% in the same period of 2019. Net loss attributable to Steven Madden, Ltd. was (6.9) million US dollars, or (0.09) US dollars per diluted share, compared to net income attributable to Steven Madden, Ltd. of 52.5 million US dollars, or 0.63 US dollars per diluted share, in the same period of 2019.

Segment Results

Revenue for the wholesale business decreased by 32.7% to 283.8 million US dollars in the third quarter of 2020, including a 32.5% decline in wholesale footwear and a 33.3% decline in wholesale accessories/apparel. Gross margin in the wholesale business increased 70 basis points to 34.6% compared to 33.9% in the third quarter of 2019. Retail revenue decreased by 22.1% to 59.0 million US dollars in the third quarter of 2020 due to a significant decline in the brick-and-mortar business, partially offset by strong growth in the e-commerce business. Retail gross margin rose 50 basis points to 63.8% compared to 63.3% in the third quarter of 2019.

Network of Stores

Steve Madden ended the quarter with 221 company-operated retail stores, including eight internet stores, as well as 17 company-operated concessions in international markets.

Fiscal Year 2020 Outlook

Given the continued disruption and uncertainty related to the COVID-19 pandemic, the company is not providing guidance at this time.