Skechers Tanks on Weak Guidance and Earnings Miss

Shares of shoemaker Skechers USA Inc. (SKX)  fell more than 25% to $24.52 in morning trading on Friday, July 20, after earnings came in below forecasts and guidance was below estimates. 

The company reported a second-quarter sales record of $1.134 billion, a 10.6% increase over the same period last year, yielding earnings of $561 million, or 29 cents a share. However, the company earned 38 cents a share in the year-ago period

On a non-GAAP basis, Skechers earned 36 cents per share while analysts were expecting it to report EPS of 41 cents. 

The company reported double-digit growth in its largest international markets, but its operating margin fell to 7.2% from 8.4% year over year. 

More importantly, Skechers' forward-looking guidance failed to meet Wall Street's expectations. It sees revenue between $1.2 billion and $1.225 billion in the third quarter on EPS between 50 cents and 55 cents. Analysts are expecting revenue of $1.26 billion yielding earnings of 68 cents a share. 

Skechers' struggles offer a stark contrast to the strong quarter Nike Inc. (NKE) reported last month. Nike shares hit an all-time high following its earnings release. 

More from Investing

Buffett Buys More Apple, General Motors and Goldman Sachs

Buffett Buys More Apple, General Motors and Goldman Sachs

Fisker CEO: Autonomous Electric Shuttle Will Debut Soon at Major Tech Company

Fisker CEO: Autonomous Electric Shuttle Will Debut Soon at Major Tech Company

Tapestry CEO Talks Trade, Kate Spade Revival and Selena Gomez

Tapestry CEO Talks Trade, Kate Spade Revival and Selena Gomez

Rewind: Jim Cramer on Home Depot, Tapestry, Nordstrom and Square

Rewind: Jim Cramer on Home Depot, Tapestry, Nordstrom and Square

What to Expect From Nordstrom on Thursday

What to Expect From Nordstrom on Thursday