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Genesco’s third quarter results were met with a sharp negative market reaction, reflecting investor concerns over profitability despite meeting revenue expectations. Management identified stronger back-to-school sales at Journeys and ongoing store optimization as key drivers, but acknowledged that heightened promotional activity in the UK and headwinds from tariffs pressured gross margins. CEO Mimi Eckel Vaughn stated that Schuh faced "heightened promotional activity" while the exit of licenses in Genesco Brands Group and the impact of tariffs added further margin pressure.

Is now the time to buy GCO? Find out in our full research report (it’s free for active Edge members).

Genesco (GCO) Q3 CY2025 Highlights:

• Revenue: $616.2 million vs analyst estimates of $617.5 million (3.3% year-on-year growth, in line)
• Adjusted EPS: $0.79 vs analyst expectations of $0.86 (8.1% miss)
• Adjusted EBITDA: $26.27 million (4.3% margin, 12.3% year-on-year growth)
• Management lowered its full-year Adjusted EPS guidance to $0.95 at the midpoint, a 36.7% decrease
• Operating Margin: 2.1%, in line with the same quarter last year
• Locations: 1,245 at quarter end, down from 1,302 in the same quarter last year
• Same-Store Sales rose 3% year on year (6% in the same quarter last year)
• Market Capitalization: $256.9 million

While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.

Our Top 5 Analyst Questions From Genesco’s Q3 Earnings Call

• Mitch Kummetz (Seaport Research): asked for clarity on Journeys’ fourth quarter comp expectations. CEO Mimi Eckel Vaughn confirmed positive comps are anticipated, driven by strong store performance but moderated e-commerce, and highlighted ongoing store closures to improve productivity.
• Joseph Vincent Civello (Truist Securities): sought insight into demand trends between athletic and canvas footwear. Vaughn explained athletic styles are seeing increased year-round demand and innovation, while canvas is less in demand with limited innovation expected.
• Mantero Valentino Moreno-Cheek (Jefferies): questioned the strategy for expanding Journeys’ brand portfolio. Vaughn said diversification is key, with new brands like HOKA and Nike supporting growth, though initial volumes start small and build over time as consumer preferences evolve.
• Mantero Valentino Moreno-Cheek (Jefferies): also asked about gross margin improvement levers. Vaughn and CFO Sandra Harris cited the exit of one-time license liquidations and ongoing actions at Schuh as main drivers, while acknowledging tariffs will remain a headwind.
• Mantero Valentino Moreno-Cheek (Jefferies): inquired about marketing spend effectiveness. Vaughn noted a shift from performance to brand marketing, with campaigns like ‘Life on Loud’ and the Peyton Manning partnership aimed at boosting awareness and customer acquisition.

Catalysts in Upcoming Quarters

Looking ahead, the StockStory team will track (1) the pace of recovery and margin improvement at Schuh as inventory and promotional strategies are adjusted, (2) continued progress in Journeys’ store remodel program and new brand partnerships, and (3) the impact of tariffs and completion of license liquidations on gross margins. We will also monitor the effectiveness of expanded marketing campaigns and new product introductions in driving customer traffic and sales.

Genesco currently trades at $24.01, down from $35.15 just before the earnings. Is there an opportunity in the stock?See for yourself in our full research report (it’s free for active Edge members).

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Let’s dig into the relative performance of Genesco and its peers as we unravel the now-completed Q3 footwear earnings season.

Before the advent of the internet, styles changed, but consumers mainly bought shoes by visiting local brick-and-mortar shoe, department, and specialty stores. Today, not only do styles change more frequently as fads travel through social media and the internet but consumers are also shifting the way they buy their goods, favoring omnichannel and e-commerce experiences. Some footwear companies have made concerted efforts to adapt while those who are slower to move may fall behind.

The 7 footwear stocks we track reported a satisfactory Q3. As a group, revenues beat analysts’ consensus estimates by 1.5% while next quarter’s revenue guidance was 7.9% above.

While some footwear stocks have fared somewhat better than others, they have collectively declined. On average, share prices are down 3.4% since the latest earnings results.

Genesco

Spanning a broad range of styles, brands, and prices, Genesco sells footwear, apparel, and accessories through multiple brands and banners.

Genesco reported revenues of $616.2 million, up 3.3% year on year. This print was in line with analysts’ expectations, but overall, it was a softer quarter for the company with full-year EPS guidance missing analysts’ expectations significantly and a significant miss of analysts’ EPS estimates.

Mimi E. Vaughn, Genesco's Board Chair, President and Chief Executive Officer, said, “We delivered another quarter of top and bottom-line growth, marking our fifth consecutive quarter of positive comparable sales increases. The third quarter demonstrated the power of our strategic initiatives, with Journeys delivering strong double-digit comp growth during back-to-school on top of double-digit growth last year. This performance reinforces that when consumers shop for footwear, they are increasingly choosing Journeys, underscoring the momentum of our product elevation and diversification strategy as we continue to gain market share and establish ourselves as the destination for the style-led teen.”

Unsurprisingly, the stock is down 31.7% since reporting and currently trades at $24.01.

Read our full report on Genesco here, it’s free for active Edge members.

Best Q3: Nike

Originally selling Japanese Onitsuka Tiger sneakers as Blue Ribbon Sports, Nike is a global titan in athletic footwear, apparel, equipment, and accessories.

Nike reported revenues of $11.72 billion, up 1.1% year on year, outperforming analysts’ expectations by 6.5%. The business had an incredible quarter with an impressive beat of analysts’ constant currency revenue estimates and a beat of analysts’ EPS estimates.

Nike delivered the biggest analyst estimates beat among its peers. Although it had a fine quarter compared its peers, the market seems unhappy with the results as the stock is down 5.6% since reporting. It currently trades at $65.84.

Is now the time to buy Nike? Access our full analysis of the earnings results here, it’s free for active Edge members.

Weakest Q3: Caleres

The owner of Dr. Scholl's, Caleres is a footwear company offering a range of styles.

Caleres reported revenues of $790.1 million, up 6.6% year on year, exceeding analysts’ expectations by 2.8%. Still, it was a disappointing quarter as it posted full-year EPS guidance missing analysts’ expectations significantly and a significant miss of analysts’ adjusted operating income estimates.

As expected, the stock is down 2.9% since the results and currently trades at $13.12.

Read our full analysis of Caleres’s results here.

Crocs

Founded in 2002, Crocs sells casual footwear and is known for its iconic clog shoe.

Crocs reported revenues of $996.3 million, down 6.2% year on year. This number topped analysts’ expectations by 3.3%. It was an exceptional quarter as it also logged an impressive beat of analysts’ constant currency revenue estimates and EPS guidance for next quarter exceeding analysts’ expectations.

Crocs had the slowest revenue growth among its peers. The stock is up 2.4% since reporting and currently trades at $86.75.

Read our full, actionable report on Crocs here, it’s free for active Edge members.

Steven Madden

As seen in the infamous Wolf of Wall Street movie, Steven Madden is a fashion brand famous for its trendy and innovative footwear, appealing to a young and style-conscious audience.

Steven Madden reported revenues of $667.9 million, up 6.9% year on year. This result missed analysts’ expectations by 4%. Zooming out, it was actually a strong quarter as it produced EPS guidance for next quarter exceeding analysts’ expectations and revenue guidance for next quarter exceeding analysts’ expectations.

Steven Madden had the weakest performance against analyst estimates among its peers. The stock is up 33.2% since reporting and currently trades at $43.73.

Read our full, actionable report on Steven Madden here, it’s free for active Edge members.

What Happened?

Shares of footwear, apparel, and accessories retailer Genesco jumped 4.3% in the afternoon session after the stock appeared to rebound following a steep sell-off in the previous session that was caused by a disappointing third-quarter earnings report. 

The prior plunge, which saw the stock drop by approximately 30%, occurred after the company reported a miss on profit expectations and lowered its full-year earnings guidance. While Genesco's sales met Wall Street's estimates, its non-GAAP profit per share fell 8.1% below what analysts had predicted. Furthermore, the company cut its full-year adjusted earnings per share forecast by about 37%. Following the report, Truist Securities reduced its price target on the stock to $27 from $31, citing the earnings miss and weaker-than-expected guidance. The upward move seemed to be a technical bounce after the significant prior losses.

After the initial pop the shares cooled down to $23.72, up 4.3% from previous close.

Is now the time to buy Genesco? Access our full analysis report here.

What Is The Market Telling Us

Genesco’s shares are extremely volatile and have had 42 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.

The previous big move we wrote about was 17 days ago when the stock gained 9.3% on the news that comments from a key Federal Reserve official bolstered hopes for an interest rate cut. New York Federal Reserve President John Williams stated he sees “room for a further adjustment” in the near term, sparking a significant market rally. Following his remarks, the probability of the central bank cutting rates at its December meeting jumped from 39% to over 73%, according to the CME FedWatch tool. This positive sentiment provided relief to markets amid concerns over high valuations, particularly in AI-related stocks.

Genesco is down 43.3% since the beginning of the year, and at $23.72 per share, it is trading 46.1% below its 52-week high of $43.99 from December 2024. Investors who bought $1,000 worth of Genesco’s shares 5 years ago would now be looking at an investment worth $716.68.