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    Earnings call· Jun 2026(Q2 FY26)

    WOLVERINE WORLD WIDE INC /DE/ Q2 FY26 earnings call WWW

    Aug 13, 2026 Source

    Executive summary

    Wolverine Worldwide Q2 FY26 — Strong Merrell and Saucony Performance Drives Raised Full-Year Outlook

    Wolverine Worldwide delivered strong second-quarter results, driven by robust performance from Merrell and Saucony, which continue to lead growth across the portfolio. The company raised its full-year revenue and EPS guidance, reflecting sustained momentum and effective cost management despite ongoing tariff headwinds and a strategic reset in Sweaty Betty's U.S. business. Management is focused on brand building, product innovation, and marketplace execution to drive durable, profitable growth.

    Highlights

    5

    • Revenue of $506 million exceeded the high end of outlook, growing 6% on a constant currency basis.

    • Adjusted earnings per share grew 14% year-over-year to $0.40, exceeding outlook.

    • Merrell revenue increased 10% (constant currency) with triple-digit basis point market share gains in the U.S. hike category.

    • Saucony revenue increased 9% (constant currency) on top of 40% growth last year, leading to a raised full-year outlook to mid-teens growth.

    • Adjusted operating margin expanded 80 basis points to 10%, exceeding expectations due to strong revenue growth and disciplined cost management.

    Concerns

    3

    • Gross margin decreased 70 basis points year-over-year to 46.5%, primarily due to an approximate 310 basis point unmitigated tariff headwind.

    • Sweaty Betty revenue declined 3% (constant currency) due to a planned and ongoing U.S. business reset.

    • DTC revenue was approximately flat versus the prior year, with Merrell's DTC declining due to a deliberate shift in marketing investments towards upper funnel brand building.

    Guidance & targets

    20
    CategoryTargetConfidence
    Full-year 2026 Revenue
    $1.98 billion to $2.0 billion
    high materiality
    High
    Full-year 2026 Active Group Revenue Growth
    high single digits
    medium materiality
    High
    Full-year 2026 Workgroup Revenue Growth
    approximately flat
    medium materiality
    High
    Full-year 2026 Saucony Revenue Growth
    mid-teens growth
    high materiality
    High
    Full-year 2026 Merrell Revenue Growth
    mid-single digits
    medium materiality
    High
    Full-year 2026 Sweaty Betty Revenue Growth
    decline low single digits
    medium materiality
    High
    Full-year 2026 Wolverine Revenue Growth
    approximately flat
    medium materiality
    High
    Full-year 2026 Gross Margin
    approximately 46.9%
    high materiality
    High
    Full-year 2026 Adjusted Operating Margin
    approximately 9.9%
    high materiality
    High
    Full-year 2026 Interest and Other Expense
    approximately $23 million
    medium materiality
    High
    Full-year 2026 Effective Tax Rate
    approximately 18%
    medium materiality
    High
    Full-year 2026 Adjusted Diluted EPS
    $1.55 to $1.65
    high materiality
    High
    Full-year 2026 Operating Free Cash Flow
    $115 million to $130 million
    high materiality
    High
    Full-year 2026 Capital Expenditures
    approximately $20 million
    medium materiality
    High
    Q3 2026 Revenue
    $495 million to $500 million
    high materiality
    High
    Q3 2026 Active Group Revenue Growth
    high single digits
    medium materiality
    High
    Q3 2026 Workgroup Revenue Growth
    approximately flat
    medium materiality
    High
    Q3 2026 Gross Margin
    approximately 47.4%
    high materiality
    High
    Q3 2026 Adjusted Operating Margin
    approximately 10.4%
    high materiality
    High
    Q3 2026 Adjusted Diluted EPS
    $0.42 to $0.45
    high materiality
    High

    Segment performance

    9
    SegmentRevenueYoYQoQMargin
    Total Company
    Exceeded revenue and EPS expectations, driven by strong performance in Active Group. Disciplined cost management contributed to operating margin expansion.
    Adjusted Operating Margin: 10% (+80 bps YoY)Adjusted EPS: $0.40 (+14% YoY)
    		$506M7% reported, 6% constant currency——
    Wholesale
    Reflecting strong international performance and continued growth in the U.S.
    		—8% constant currency——
    Direct-to-Consumer (DTC)
    Merrell's DTC declined due to a deliberate shift in marketing investments towards upper funnel brand building.
    		—approximately flat constant currency——
    Active Group
    Performance across the segment exceeded expectations.
    		—8% constant currency——
    Merrell
    Growth in all regions, outsized internationally. It Starts Outside marketing platform creating brand consistency and lifting purchase intent. DTC revenue declined due to deliberate marketing shift.
    U.S. Hike Market Share Gain: triple-digit basis pointsMoab 3 Growth: significant double-digitMoab Speed 2 Growth: significant double-digitAgility Peak 6 Growth: double digits globallyWrap Franchise Growth: more than doubling year-over-year at U.S. retail
    		—10% constant currency——
    Saucony
    Driven by growth in both wholesale and DTC, led by international markets. Momentum across performance and lifestyle categories.
    Brand Search Interest Growth (Global): almost two times fasterBrand Search Interest Growth (UK): more than tripledU.S. Run Specialty Market Share: gained
    		—9% constant currency (on top of 40% growth last year)——
    Sweaty Betty
    Reflecting planned U.S. business reset. Encouraging consumer response to broader product assortment. New store design lifts performance.
    UK DTC Growth: mid-single digitsInternational Wholesale Growth: strong double digits
    		—down 3% constant currency (overall), up 3% constant currency (excluding U.S. reset impact)——
    Workgroup
    Modestly ahead of expectations. Actions to enhance product offerings and improve marketplace health are gaining traction.
    		—down 2% constant currency——
    Wolverine
    Focused on managing a cleaner marketplace and elevating positioning. Recalibration of marketplace ongoing, leading to some volatility.
    Market Share: added (3rd consecutive quarter)Tradesman Wedge Growth: double-digit at retailLoader II Growth: double-digit at retailRancher Growth: double-digit at retailWheatland Growth: double-digit at retail
    		—high single digits constant currency——

    Operational metrics

    9
    Adjusted Operating Margin
    10%up 80 bps YoY
    Q2 FY26

    50 basis points above expectations. Improvement driven by strong revenue growth and disciplined management of operating expenses.

    Adjusted Diluted EPS
    $0.40up 14% YoY
    Q2 FY26

    Above outlook of $0.35 to $0.38.

    Net Debt
    $443Mdown $125M YoY
    Q2 FY26

    Balance sheet is meaningfully stronger than two years ago.

    Foreign Currency Benefit
    $14M
    FY26

    Assumption unchanged versus prior year.

    53rd Week Revenue Contribution
    70 bps
    FY25

    Contributed to full-year 2025 revenue growth, primarily within DTC business.

    SG&A Growth
    2%
    Q2 FY26

    Tightly managed dollars, contributing to adjusted EPS growth.

    SG&A as % of Revenue
    largely consistent with May outlookdecrease of around 130 bps to last year
    FY26

    Reflects continued investment in brands and digital initiatives while maintaining discipline across the rest of the cost structure.

    Merrell Lifestyle Business % of Total
    less than a quarter
    current

    Viewed as an opportunity for growth, with focus on broader outdoor lifestyle and female consumers.

    Saucony Lifestyle Door Counts
    approximately flatto first half
    H2 FY26

    No change from prior guidance. Implies stronger productivity within existing accounts.

    Industry KPIs

    8
    MetricValueDetails
    Effective tax rate18%%
    Inventory position—
    Revenue by channel—
    Operating margin sg a10%%
    Store fleet door investment—
    Share buyback capital return—
    Tariff cost exposure recovery—
    Franchise product cycle performance—

    Product announcements

    8
    ProductTypeDetails
    Endorphin Elite 3launch
    Triumph 24launch
    Hurricane 26launch
    Ride Onelaunch
    Kinvara Onelaunch
    ProGrid Paramountlaunch
    Saucony Apparel Capsule Collectionlaunch
    New Endorphin Modelroadmap

    Deals & partnerships

    2
    Metallica ScholarsCollaboration for limited edition boot and workwear collection.

    Benefits trades education.

    Paramount+Partnership for brand awareness through the series Landman.

    Upper funnel investment to accelerate growth of consumer interest.

    Risks & headwinds

    5
    Unmitigated tariff headwindQ2 FY26, FY26

    310 basis points impact on Q2 gross margin; $2 million reduction in estimated unmitigated impact for FY26 outlook

    Mitigation: Mitigation actions offset most of the impact in Q2; supply chain efficiencies and marketplace execution also help.

    Elevated oil prices on freight costsQ2 FY26, Q3 FY26

    modest impact on Q2 gross margin; modest headwind for Q3 gross margin

    Mitigation: Mitigation actions and other business initiatives offsetting majority of impacts.

    Planned and ongoing reset of Sweaty Betty's U.S. businessQ2 FY26, ongoing

    3% constant currency revenue decline for Sweaty Betty in Q2 FY26

    Mitigation: Strategic decision for long-term health; UK DTC and international wholesale showing growth.

    Recalibration of the marketplace to optimize assortments and inventory at key retailers for Wolverine brandnear-term

    expected choppiness and near-term volatility at retail

    Mitigation: Inventory is getting cleaner; new distribution and segmentation strategies are sharper.

    External environment uncertaintyongoing

    unquantified

    Mitigation: Confidence in the business continues to grow due to strong financial position and progress across the portfolio.

    What to watch in Q3 FY26

    5

    Sweaty Betty U.S. Reset Impact

    next quarter (Q3 FY26)
    Current3% constant currency revenue decline in Q2 FY26 (overall), but grew 3% excluding U.S. reset impact
    TargetReduced negative impact on overall brand growth

    Why it matters

    The U.S. reset began in Q3 FY25, so Q3 FY26 will be the first quarter to lap the initial impact, potentially revealing underlying growth.

    The U.S. reset that really began to happen in the third quarter of last year. And we will shortly lap that, which will provide some easier comparisons.

    Q&A highlights

    6

    Asked about competitiveness and discounting in the running market, and factors driving Saucony's implied acceleration in the second half, beyond easier comparisons.

    Chris Hufnagel acknowledged fierce competition but highlighted Saucony's strong product pipeline and global growth story, not just U.S. The acceleration is partly due to easier comparisons but also strong international performance and continued momentum in both performance and lifestyle categories.

    “The run category is obviously a very attractive and growing category and we're thrilled that we have one of the original running brands in Saucony performing the way it has and the trajectory we see. But certainly fiercely competitive and we've got sort of great respect for the competition that's out there.”

    asked by Jonathan Komp · answered by Chris Hufnagel

    2 min read7 chapters

    Detailed Narrative

    01

    Merrell's Sustained Growth and Market Share Gains

    Merrell continued its strong performance with double-digit revenue growth across all regions, particularly internationally. The brand gained triple-digit basis points in U.S. hike market share, with key franchises like Moab 3 and Moab Speed 2 driving significant double-digit growth. Marketing efforts like "It Starts Outside" and engagement at Paris Fashion Week are elevating its global lifestyle profile, with plans to accelerate this segment in 2027.

    02

    Saucony's Global Momentum and Innovation

    Saucony achieved solid growth in both performance and lifestyle running categories globally, building on 40% growth from the prior year. Its "Key City Playbook" in Europe (London, Berlin, Paris) has fueled strong brand heat and consumer demand, with search interest accelerating significantly. The brand continues to innovate with new models like the Endorphin Elite 3 and upcoming Endorphin model in 2027, alongside successful lifestyle collaborations and a planned apparel capsule collection with Sweaty Betty.

    03

    Sweaty Betty's Strategic Reset and International Expansion

    Sweaty Betty's revenue declined low single digits overall, but grew approximately 3% when excluding the impact of its U.S. market reset. The UK direct-to-consumer business grew mid-single digits, supported by new store designs and product diversification into bottoms and outerwear. International wholesale and distribution partners in Europe and Asia Pacific are expanding, with revenue up strong double digits, indicating positive response to the brand's updated strategy.

    04

    Wolverine Brand's Turnaround and Market Share Recovery

    The Wolverine brand returned to high single-digit revenue growth and gained market share for the third consecutive quarter, driven by a focus on cleaner marketplace management and elevated positioning. New product innovations like the Tradesman Wedge and Loader II, along with targeted marketing campaigns (e.g., Metallica Scholars, American Dream contest), are driving double-digit growth in key retail franchises and increasing consumer interest.

    05

    Gross Margin Headwinds and Mitigation

    Consolidated gross margin decreased 70 basis points year-over-year to 46.5%, primarily impacted by an approximate 310 basis point unmitigated tariff headwind🌐 and modest freight cost increases from elevated oil prices. However, mitigation actions and other business initiatives offset most of these impacts, contributing to the gross margin exceeding expectations by 10 basis points.

    06

    Operating Leverage and Profitability Improvement

    Despite gross margin pressures, adjusted operating margin expanded 80 basis points year-over-year to 10%, exceeding expectations by 50 basis points. This improvement was driven by strong revenue growth and disciplined management of operating expenses, demonstrating the effectiveness of the company's operating model and strategic investments in brands and capabilities.

    07

    Balance Sheet Strengthening

    The company significantly improved its financial position, with net debt reduced to $443 million, down $125 million compared to the prior year. This strengthening of the balance sheet provides increased financial flexibility and reinforces confidence in the company's long-term earnings potential.

    AI-generated summary of the company’s earnings call. Not investment advice.