Steven Madden Rethinks Supply Chain Strategy As Tariffs Bite

As global trade tensions continue to reshape manufacturing strategies, companies like Steven Madden, Ltd. (NASDAQ:SHOO) face mounting pressure to adapt. The fluctuating tariff landscape has prompted the footwear giant to alter its production plans and financial outlook, reflecting broader economic uncertainties that have left investors and analysts closely monitoring its next moves.

Steven Madden shares are trading relatively flat on Thursday, after the company announced that it will not be providing 2025 financial guidance this time.

• SHOO stock is ticking upward. Check the price action here.

Here are the key analysts’ takes on the stock:

• Needham analyst Tom Nikic reiterated the Hold rating on the stock.
• Telsey Advisory Group analyst Dana Telsey maintained the Market Perform rating on the stock, raising the price forecast from $24 to $26.

Also Read: QUALCOMM Stock Is Trading Lower Thursday: What’s Going On?

Needham’s Take

Nikic noted that while estimates for FY25 and FY26 EPS have been slightly raised to $1.48 and $1.90, respectively—up from $1.40 and $1.64—due to previously underestimating the firm’s tariff mitigation efforts, the analyst remains cautious on the stock amid ongoing external challenges. Nikic pointed out that quarterly revenue growth of 7% missed the Street's 11% estimate and included a ~17-point lift from the Kurt Geiger acquisition, implying a 10% organic decline.

Nikic recalled that during the prior earnings call in May, China faced a steep 145% tariff, prompting management to shift production away, aiming for only a mid-teens percentage of Fall '25 orders from China, down from 58% for Spring '25.

However, with tariff rates now converging—30% for China and 15%–20% for many other countries—management has had to revise their strategy, ultimately sourcing 30% of Fall '25 orders from China, more than initially planned.

Telsey’s Viewpoint

Telsey highlighted that Steven Madden took several steps to mitigate tariff impacts, including diversifying its supply chain away from China, negotiating supplier discounts, and applying targeted price increases. Despite these efforts, the company faced shipment delays in the second quarter due to the onset of tariffs, which led to lost sales and pushed deliveries into the third quarter and fourth quarter, pressuring quarterly sales and margins.

The tariffs weighed on second-quarter consolidated gross margins by 230 basis points. With China's tariff rate now at 30%—down from the previous 145%—Steven Madden shifted some Fall 2025 production back to China, leveraging better quality and turnaround times.

Management indicated that tariff-related headwinds will persist into the third quarter, with no substantial margin relief expected.

The FY25 sales forecast has been lowered to $2.47 billion, reflecting 8.3% growth but below the previous $2.51 billion estimate, while FY25 EPS is now expected at $1.42, down from $1.70 and below last year's $2.67. FY26 EPS remains at $2.00, slightly below the $2.02 consensus.

SHOO Price Action: Steven Madden shares were up 0.78% at $24.05 at the time of publication on Thursday, according to Benzinga Pro data.

See Also: 

• Examining the Future: Exxon Mobil's Earnings Outlook

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