Oh, no. Things are getting ugly for Crocs (CROX) again.
The footwear maker is still growing, but not as quickly as the market would like. The company saw revenue in the third quarter climb 8% to $295.6 million, short of the $302.4 million that analysts were targeting.
Things held up far better on the bottom line where net income soared 49% to $45.1 million or $0.49 a share. Wall Street was settling for a profit of just $0.43 a share.
The market can go either way with a mixed quarter like this, but the bears are winning this round on concerns that the brand's appeal is softening.
Crocs exploded on the scene in 2002 with its colorful resin shoes. They were loud. They were tacky. However, the undeniable comfort of its odor-resistant footwear made them popular with kids and folks who have to do a lot of walking or standing on the job.
Given the faddish way the shoes hit the market a few years ago, it may come as a shock to some to learn that Crocs is still growing. It helps that the company's shoe lines have expanded. We're not just talking about rubbery shoes in gaudy hues these days. Some of them even look fashionable. Perhaps more importantly, Crocs exploded in popularity in Europe and Asia, though the European economy's woes have made that a particularly hard market for the company lately. Either way, Crocs has gone from 410 retail stores to 499 locations over the past year.
Its outlook for the holiday quarter isn't pretty. Crocs expects to merely break even on $220 million in revenue. Wall Street pros were banking on a profit of $0.10 a share on $234 million in revenue.
Other Things Worth Watching
• There's money to be made in offering paying subscribers access to reviews on local service providers, but apparently not enough to turn a profit. Angie's List (ANGI) posted another quarter of strong top-line growth, held back by widening deficit. Revenue soared 75% to $42 million, but the company's net loss of $18.5 million was larger than the $17.4 million of red ink that it posted a year earlier. Is it too late for Angie's List to use its own website to find someone that can grow this business profitably?
• Zynga (ZNGA) may finally be getting a break. The company may have posted unimpressive quarterly results on Wednesday night -- posting a small adjusted loss on an 11% decline in bookings -- but a promising gaming venture overseas and a share buyback helped push the stock higher for a change. Zynga was trading so close to its net cash balance that a buyback makes perfect sense.
Get info on stocks mentioned in this article: