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Weyco: Weyco Group's 2025 Earnings: Navigating Tariffs and Consumer Sentiment

Weyco Group reported fourth quarter net sales of $76.8 million, a 5% decline from $80.5 million in 2024, with earnings from operations down 12% to $10.2 million. The company's gross margin was 44.1% of net sales, compared to 47.9% in 2024. Net earnings totaled $8.7 million, down 13% from $10 million last year. For the full year 2025, the company's overall sales were down 5%, with gross margins compressed by 200 basis points due to incremental tariffs. The actual EPS came out at $0.21, below estimates of $0.25.

WEYS

USD 31.06

-0.77%

A-Score: 6.4/10

Publication date: March 4, 2026

Full Report

Author: Analystock.ai

📋 Highlights
  • Q4 Net Sales Decline: Net sales dropped 5% to $76.8M in Q4 2025 from $80.5M in 2024, with full-year sales also declining 5%.
  • Gross Margin Compression: Gross margin fell to 44.1% (vs. 47.9% in 2024), driven by 19-50% price hikes from US retaliatory tariffs and $16M in incremental tariff costs.
  • Florsheim Brand Growth: Florsheim achieved record $92M sales in 2025, a post-pandemic growth leader among non-athletic men’s footwear brands.
  • Wholesale & Retail Performance: North American wholesale sales fell 6% to $56.7M (Q4), while retail sales declined 5% quarterly and 8% annually.
  • Supply Chain Diversification: 65-70% of products sourced from China, but the company diversified to Cambodia and Vietnam to mitigate tariff risks and enhance flexibility.

Segment Performance

The North American wholesale segment net sales totaled $56.7 million for the quarter, down 6% from $60.4 million last year. The retail segment net sales declined 5% for the quarter and 8% for the year. In contrast, Florsheim Australia's net sales increased 12% for the quarter and 11% in local currency. The Florsheim brand achieved record sales of $92 million in 2025, driven by sustained post-pandemic growth.

Tariff Impact and Mitigation

The company faced significant challenges due to the U.S.-imposed retaliatory tariffs on imported goods, resulting in gross margin compression. The company paid approximately $16 million in incremental tariffs in 2025. According to Thomas W. Florsheim, the 10% price increase only covered a small percentage of the tariff, and the company is seeking a refund for the amounts paid through a lawsuit. The company has diversified its manufacturing base, sourcing around 65-70% of its products from China, but has also established a better footprint in Cambodia and Vietnam.

Valuation and Outlook

With a P/E Ratio of 12.85 and a Dividend Yield of 9.81%, Weyco Group's valuation suggests a relatively stable outlook. The company's ROE is 9.35%, indicating a decent return on equity. Given the challenges related to tariffs and consumer sentiment, the company's ability to maintain historical margins and adjust its pricing strategy will be crucial. The estimated 2026 annual capital expenditures are between $1 million and $3 million, indicating a cautious approach to investment.

Weyco's A-Score