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CFO Steve Fasching clarified that wholesale order books remain strong, but the company is being cautious due to macroeconomic uncertainty and the unknown impact of future price increases on U.S. consumer demand. CEO Stefano Caroti reiterated the long-term goal of a 50/50 DTC/wholesale split. Fasching added that the current wholesale expansion is a strategic response to growing brand awareness and consumer desire to try new models in physical stores, which temporarily pressured D2C comps.

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Carrie Baker, President of Brand & Commercial, explained that the focus on 'newness' includes innovating core products with new fabrics and features, not just launching entirely new items. She highlighted apparel categories like wind-wear and rainwear as key growth areas, citing the success of the Sea Mantra launch. Baker stated the product introduction will be a progressive, ongoing process throughout the year, rather than a single seasonal drop, with significant newness planned for Fall/Winter and Spring collections, supplemented by Haider Ackermann's seasonal capsules.

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CFO Sarah Oughtred explained that while reported international growth was 16%, underlying trends in Mexico, Europe, and the Middle East are healthy, driven by traffic and conversion. She attributed the guided back-half slowdown primarily to a reduced promotional cadence. CEO Trina Spear shared insights from her Australia trip, highlighting the focus on localization. Regarding pricing, Oughtred noted the company is strategically considering options across core, limited edition, and new styles but has not made a decision.

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CEO Andrew Rees identified brand penetration as the primary international driver, noting that market share in many regions is a fraction of that in the U.S. Key focus areas are China, India, and Western Europe. He explained that marketing spend is allocated to both priorities, with HEYDUDE's marketing as a percentage of sales being slightly higher than Crocs', and Crocs' budget being strategically focused on high-growth international markets.

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CEO Andrew Rees clarified that while China's growth has slowed from prior highs, it is still expected to grow, aided by a significant expansion of mono-brand stores. He identified India (once regulatory production hurdles are cleared), Germany, and France as other key growth drivers. He noted Australia and South Korea are more stable, while Japan remains a work in progress, providing a broad base of growth engines for the international business.

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Coach CEO Todd Kahn detailed the 'One Coach' strategy, which intentionally blurs the lines between retail and outlet channels to be more consumer-centric. He noted they are successfully selling historically full-price products, like the Tabby bag, in outlet locations at full price. He also cited the launch of the Soho sneaker at a single price point across all channels as an example of amplifying big ideas and resonating with younger consumers wherever they shop.

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Co-CEO Michael Mente attributed the confidence in owned brands to years of investment and strong performance on forward-leading internal metrics. Co-CEO Michael Karanikolas stated that while they could cut G&A, it is not the plan. Instead, they are focused on long-term positioning and investing through the cycle, supported by their $300 million cash balance.

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CFO Jesse Timmermans confirmed that sales accelerated through the quarter across both segments but did not provide a monthly breakdown. Regarding owned brands, he noted that strong underlying metrics have set the stage for expansion in the second half of 2025. While owned brand sales grew, the overall mix was slightly lower. He reiterated that the margin is "significantly better" than third-party brands without giving a specific figure.

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President Jen Foyle stated that basket size is a key focus and is currently holding its own, with opportunities from new dressing occasions and cross-brand selling. CFO Mike Mathias reiterated that marketing spend is planned to increase in the first half, funded by other SG&A reductions, and remains a flexible line item for the back half of the year depending on ROI and business needs.

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John Vandemore (executive) explained that the modest acceleration beyond Q1 is primarily due to lapping a stronger Q1 in China from the prior year, creating a difficult comparison. David Weinberg (executive) stated the strategy for new performance sports is to 'seed' the market with athlete partnerships and new products, expanding as market acceptance grows rather than forcing it. John Vandemore added that other sports categories will be introduced and they will continue to invest in building awareness for the performance division.

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Executive David Weinberg affirmed that the full-year expectation for global wholesale growth is accurate and likely at the low end of the previously discussed range, supported by a very strong order book. On sourcing, he stated there's been no fundamental change from the roughly 40% from China and 40% from Vietnam mix, with a significant portion of China production serving the local market. He noted that while they are diversifying, any potential future tariffs would be a market-wide issue, and the company is poised to react quickly to actual changes rather than hypotheticals.

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COO Scott Lipesky explained that the company sees an opportunity to continue reducing promotions in Q4, similar to Q3, driven by healthy inventory levels and strong product acceptance. He noted that the ability to pull back on promotions is a key factor supporting the gross margin, which sits at a strong 65%. He also stated that the impact on AUR from sales mix shifts between brands and regions is not material enough to be a significant factor.

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COO Scott Lipesky stated that the opportunity to reduce promotions in Q4 is strong, thanks to healthy inventory levels and positive product acceptance. He clarified that any AUR impact from sales mix shifts is not material, instead emphasizing the strength of the overall 65.1% gross profit rate achieved in the quarter.

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Executive Co-Chairman and Co-Founder Caspar Coppetti confirmed that Q3 apparel growth was constrained by supply, which is now easing. He highlighted a critical improvement: a complete resizing of the apparel line to ensure a consistent global fit, which is already reducing return rates. For channel strategy, he emphasized that On's own retail stores, which achieve up to 30% apparel share, are a key building block for establishing On as a premium apparel brand.

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CEO Calvin McDonald clarified that the key issue that became more pronounced in Q2 was a lack of newness in silhouettes and styles, compounding the ongoing opportunity in color and print. Regarding accessories, he noted the category grew 7% and that the team is successfully diversifying beyond the Everywhere Belt Bag with new products like backpacks, seeing significant long-term growth potential from its current low market share.

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CEO Calvin McDonald explained that the primary issue that became more pronounced in Q2 was a lack of newness in silhouettes and styles, on top of the ongoing need for more color and print options. Regarding accessories, he noted the category grew 7% and is successfully diversifying beyond the Everywhere Belt Bag with new styles like backpacks, expressing confidence in future growth given low market share and a strong innovation pipeline.

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