(Reuters) - Crocs Inc’s (CROX.O) second-quarter profit plummeted 42 percent as the shoemaker resorted to discounting to offset soft sales in colder weather, sending its shares tumbling 23 percent in extended trade.
The company, known for its colorful clogs, also forecast third-quarter earnings of 20 to 23 cents per share. Analysts on average were expecting earnings of 39 cents per share.
“We expect gross margins in the third quarter to be consistent with the prior year as discounting in the second quarter was primarily the result of late spring and weather conditions,” Chief Financial Officer Jeff Lasher said on the company’s post-earnings call.
Gross margins fell 4.1 percentage points to 55.2 in the second quarter ended June 30.
Net income in the second quarter fell to $35.4 million, or 40 cents per share, from $61.5 million, or 68 cents per share, a year earlier.
Adjusting for the impact of a statutory tax audit in Brazil and the implementation of a new ERP system, the company earned 48 cents per share.
Revenue for the second quarter rose 10 percent to $363.8 million.
Analysts on average had forecast earnings of 64 cents per share, on revenue of $365.1 million.
Crocs shares were trading at $13.10 in after hours trade. They closed at $16.98 on the Nasdaq on Wednesday.
Reporting by Chris Peters and Maria Ajit Thomas in Bangalore; Editing by Anthony Kurian