Stock Soars on New Strategy

Shares for Dr. Martens plc surged 23.6 percent on Thursday following the release of a new strategic turnaround plan in efforts to return to profit growth in fiscal 2026.

According to chief executive officer Ije Nwokorie, who took the helm earlier this year, the company’s “single focus” in fiscal 2025 was to bring stability back to Dr. Martens.

“We have achieved this by returning our direct-to-consumer channel in the Americas back to growth, resetting our marketing approach to focus relentlessly on our products, delivering cost savings, and significantly strengthening our balance sheet,” Nwokorie said in a statement.

In fiscal 2025, the U.K.-based footwear company reported that net revenue fell 10 percent to 787.6 million pounds from 877.1 million pounds in fiscal 2024. Dr. Martens noted that the results were in line with guidance, however, and came up against a challenging macroeconomic and consumer backdrop in several of its core markets.

Net debt for the year was 249.5 million pounds, down from 359.8 million pounds in fiscal 2024. Net profit stood at 4.5 million pounds in the year to the end of March, down from 69.2 million pounds the year prior.

By category, overall, pairs were down 9 percent, with DTC pairs flat and wholesale pairs down 15 percent as expected, as the company’s wholesale partners normalized their inventory levels.

“We saw a very strong performance in shoes, with DTC pairs up 15 percent with particular success in our bestselling Adrian loafer, as well as in new shoe families, the Lowell and Buzz,” the company said in its latest earnings statement. “Sandals also saw a good performance, with DTC pairs up 7 percent, and we continue to see a strong performance in our mules range, led by the Zebzag. Boots remained challenging, with DTC pairs down 9 percent, with our continuity boots weaker, as expected. This was partially offset by success in product newness, both as extensions of the core icons, for example through the Ambassador soft leather boot and through new product lines such as the Anistone biker boot.”

As a proportion of fiscal-year 2025 group revenue, boots accounted for 57 percent, shoes 26 percent, sandals 12 percent and bags and other 5 percent.

By channel, DTC revenue was down 4.2 percent to 510.7 million pounds in fiscal 2025, while wholesale fell 19.5 percent to 276.9 million pounds, as expected. Within DTC, retail revenue was down 5.6 percent to 242.4 million pounds and e-commerce was down 2.9 percent to 268.3 million pounds.

By region, EMEA revenue was down 11.0 percent to 384.2 million pounds for the year, which was driven by the U.K. In the Americas, revenue was down 11.4 percent to 288.5 million pounds, and in APAC, revenue dipped 3.8 percent to 114.9 million pounds, with a good performance in Japan and China, the company noted.

Looking closer at the Americas, Dr. Martens stated that the region delivered DTC growth in the second half of fiscal 2025 as the company pivoted its marketing to “relentlessly focus” on product.

“With new products such as Ambassador, Anistone, Buzz and Dunnet Flower performing very strongly for us and our partners; we delivered 25 million pounds of annualized cost savings, at the top end of our target, with the full benefit in fiscal 2026, and we strengthened our balance sheet through a significant reduction in inventory and net debt, as well as the successful refinancing of the group,” the company said.

As for tariffs, the company noted that the entirety of its spring 2025 stock is already in the market, and by the start of July, the majority of fall 2025 will be either in the market or in transit.

“We generate strong product gross margins, which is helpful given that tariffs are charged on cost, not retail price,” the company stated. “We will continue to assess the situation carefully, but can confirm that for spring 2025 and fall 2025 we will be keeping average prices unchanged in the market. More broadly, we continue to manage all costs tightly, working closely with our wholesale and supplier partners.”

The company also released a new strategic plan on Thursday. Dubbed “Levers for Growth,” Dr. Martens said the plan builds on the work undertaken in fiscal 2025 to stabilize the business.

The new plan focuses on four “levers” including engaging more consumers, driving more product purchase occasions, curating market-right distribution, and simplifying the operating model.

Dr. Martens said the new strategy capitalizes on the strengths of its business, including its “iconic global brand, high quality products, world-class supply chain, modern technology systems, committed wholesale and distributor partners and passionate and talented team,” and taps into the significant new markets and profit pools that are available to the company.

Over the medium-term, Dr. Martens said it expects to deliver sustainable, profitable revenue growth above the rate of the relevant footwear market, with operating leverage driving a mid- to high-teens earnings before interest and taxes margin and underpinned by strong cash generation.

“Levers for Growth will increase our opportunities by shifting the business from a channel-first to a consumer-first mindset,” Nwokorie said. “We will give more people more reasons to buy more of our products, whether that’s our boots and shoes, newer product families such as Zebzag and Buzz, or adjacent categories such as sandals, bags and leather goods. And we will tailor distribution to each market, blending direct-to-consumer and business-to-business, optimizing brand reach and ensuring a better use of capital.”

The CEO added that he is “laser focused” on day-to-day execution, managing costs and maintaining the company’s operational discipline while it navigates macroeconomic uncertainties.