Why Are Crocs Popular? The 2008 Near-Collapse

A share of Crocs cost about $1 in the spring of 2009. Two years earlier it had cost more than $75. Today the company brings in more than $4 billion a year, and teenagers pay extra to wear them. This video follows the road between those two moments: a foam clog, warehouses full of stock, a sharp fall in sales, an auditors' warning, and what brought the shoe back. It asks how a shoe goes from that first price to this. A note on sourcing: figures come from Crocs' own results release and annual reports. The 2008 loss is $183.6 million in the release and $185.1 million in the annual report, so the video says "more than $183 million". Sources date the near-collapse to 2008 or 2009 because it ran across both. The arithmetic is mine, and the closing reading of why the shoe is popular is opinion. What this covers: How Crocs sold $847.4 million of shoes in 2007 while holding $248.4 million in stock Why a falling quarter and a full warehouse are a problem together, and how Crocs cut its way through What a write-off, a credit line and a going-concern warning mean The factory closures and the share price fall from $46.80 to 79 cents The $10 million Jibbitz purchase and how charms fit into the holes Collaborations, Gen Z on TikTok and the 2021 jump to $2.3 billion The story behind the thing. Narration is computer-generated (text-to-speech); research, script and drawings are original. Wren S O U R C E S THE CRASH (2007 TO 2009) Crocs fiscal 2008 results release: revenue $721.6 million against $847.4 million in 2007; fourth quarter $126.1 million against $224.8 million; net loss $183.6 million; cash $51.7 million; inventory $143.2 million against $248.4 million, mainly through write-downs; receivables down from $153.0 million to $35.3 million; credit facility extended to April 2, 2009; job cuts and the Brazil closure. https://investors.crocs.com/news-and-... Crocs Form 10-K for 2008: the auditors' explanatory paragraphs on substantial doubt about continuing as a going concern; $22.4 million borrowed on the credit facility with no more available; a loss of $185.1 million in the narrative. https://www.sec.gov/Archives/edgar/da... SGB Online, Crocs' third quarter of 2008: $104.1 million of charges; Canadian manufacturing shut down; Brazil closure begun; shares down 97% since January 1, from $46.80 to 79 cents. https://sgbonline.com/?p=25541 Wikipedia (Crocs): the 2002 boat show debut (200 pairs sold), the April 2008 share drop of about 30%, Andrew Rees as CEO from 2017. https://en.wikipedia.org/wiki/Crocs FashionNetwork (Reuters), March 2009: shares as low as about $1, down more than 90% in a year; above $75 in 2007. https://nz.fashionnetwork.com/news/Cr... THE BOOM (2004 TO 2006) Crocs Form 10-K for 2006: the June 2004 purchase of Foam Creations with the Croslite trade secrets, and the December 2006 purchase of Jibbitz for $10 million in cash, with an earn-out of up to $10 million more. https://www.sec.gov/Archives/edgar/da... THE COMEBACK (2017 TO 2024) Business Insider: Post Malone clog collaborations from 2018. https://www.businessinsider.nl/crocs-... CBC Day 6: the 2021 comeback credited to Gen Z and Justin Bieber, and Gen Z on TikTok customising shoes with Jibbitz. https://amp.cbc.ca/radio/day6/india-s... Crocs Form 10-K for 2021, World Footwear and Retail Insight Network: revenue of $2.31 billion in 2021, up 66.9%; $1.386 billion in 2020; operating income of $683.1 million. https://www.sec.gov/Archives/edgar/da... and https://www.worldfootwear.com/news.as... and https://www.retail-insight-network.co... Crocs Form 10-K for 2024: revenue of $4.102 billion, of which the Crocs brand about $3.28 billion and HEYDUDE about $824 million. https://www.sec.gov/Archives/edgar/da... OWN ARITHMETIC $2.313 billion in 2021 is about 3.2 times the $721.6 million of 2008 revenue; $3.28 billion for the Crocs brand in 2024 is about 4.5 times it; $3.28 billion rounds to $3.3 billion. #Crocs #BusinessStory #Jibbitz #GenZ #CompanyComeback