Crocs, Inc. Piper Sandler 5th Annual Growth Frontiers Conference

Yeah, looking forward to it. Thank you. Okay. Welcome to Piper's Consumer and Tech Conference.

Yeah, great to be here.

Yeah. I think what we have been seeing recently in footwear is just a continuation of some cyclicality that you see every few years. What I would say is it specifically means to Crocs is how we compete is really through the diversification of our product offering. For those of you who may not be as familiar with the story, probably when you think about Crocs, the image that comes up in your mind is our iconic Classic Clog. It really is, Anna, we are so much more than that. If you think about our product offering, we are the industry leader in clogs. We are the globally recognized leader. Our product is iconic and recognized throughout the world. That is just the beginning of the story. The continuation of the story is that from a diversification perspective within clogs, we compete through many different silhouettes.

For example, we have our Echo Collection, which is very much more of a streetwear, kind of edgier, fashion-forward silhouette. We have Crocband, which is more collegiate, a little bit younger in nature. We also, outside of clogs, compete in sandals. Not many people know this, but we are nearly a half a billion USD a year in annual revenues in our sandal business. We have been developing this over the last few years, but really just getting to scale in the last couple. Within that, our leading silhouettes are the Getaway, the Brooklyn, the Miami. We have recently introduced the Miami silhouette, which is a little bit upscale and has done really well. We have got clogs, we have got sandals. We also have a lot of lifestyle product, which continues our diversification story.

Within lifestyle, we have a product that helps and aids in terms of recovery from athletics called the Mellow, which has been meeting with a lot of success in the space. This year we had an absolute runaway hit with our Classic Ballet Flat, which was something that we were testing into as we began the year and ended up chasing throughout the year, unable to really fulfill all the demand that was in the marketplace. That is kind of a little bit of what we have in the Crocs side of the house.

From a HEYDUDE perspective, which is our complementary brand to Crocs, we have been doing a lot of work, again, from a diversification standpoint, building on the success of our Wally, Wendy icons, and moving into all things in all ways for our consumer whether that is boating, fishing through our Hey2O franchise, as well as our work franchises and our boots franchise. We feel great about where we are. Yes, there is always some cyclicality- but we feel through the breadth and the depth of our diversification, we are well positioned within the space.

Yeah. I would say a few different things. Maybe one to address kind of the bear case- which is growth through sandals.

It is interesting. For those of you who have been around the company for a while, and I have because I have been in the footwear space for quite some time. The bear case traditionally for Crocs was always that we were overly reliant on one product, which is very much not the case today. As it relates maybe closer in, yes, there was growth certainly driven by sandals, which we absolutely love and we feel like could have been even larger just from a size of consumer adoption. We left some dollars on the table. I would say as we kind of turn the clock now, there is a few things that are at work as we move from spring, summer into holiday, fall, and winter now. Number 1 is the season for sandals is no longer kind of constrained and confined just to spring/summer.

The shoulder seasons are much longer. It is going to be 98 degrees here today. I am afraid to step outside in my suit, that is for sure. I would say number 1, that season is longer, so it gives us some ability to drive additional revenue. I would also say that from a seasonality standpoint, this is where our diversification strategy really kind of provides us a lot of strength. As we now turn into fall holiday time period, as we think about some of what is becoming iconic in terms of silhouettes within our fur-lined clogs and our slippers business, we have two silhouettes that we are really excited about. The first one is called the Unfurgettable. So think of about a play on words, furgettable, unforgettable, which is a lined silhouette, which is exceptionally comfortable, and it is also very warm. So really kind of plays counter to the seasonality.