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Operator
Good day and thank you for standing by. Welcome to the Steven Madden first quarter 2024 results conference call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 11 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star 11 again. please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Danielle McCoy, VP of Corporate Development and Investor Relations. Please go ahead.
Danielle McCoy
Thanks, C.D., and good morning, everyone. Thank you for joining our first quarter 2024 earnings call and webcast. Before we begin, I'd like to remind you that our remarks made that follow are including answers to your questions, contain statements that we believe to be forward-looking statements within the meaning of the Private Securities Litigation Reform Act. These forward-looking statements are subject to risks that could cause actual results to materially differ from those expressed or implied by such forward-looking statements. These risks include, among others, matters that we have described in our press release issued earlier today, and filings we make with the SEC. We disclaim any obligation to update these forward-looking statements, which may not be updated until our next quarterly earnings conference call, if at all. The financial results discussed on today's call are on an adjusted basis, unless otherwise noted. A reconciliation to the most directly comparable GAAP financial measure and other associated disclosures are contained in our earnings release. Joining me on the call today is Ed Rosenfeld, Chairman and Chief Executive Officer, and Zeen Mazuzzi, Chief Financial Officer. With that, I'll turn the call over to Ed.
Ed
All right. Thank you, Danielle. And good morning, everyone. And thank you for joining us to review Steve Madden's first quarter 2024 results. So we got off to a strong start to 2024, with first quarter revenue increasing 19%, and diluted EPS rising 30% compared to the same period in 2023. These results are the direct result of our team's disciplined execution of our strategy for long-term growth. The foundation of that strategy is creating deeper connections with our consumers through the combination of outstanding product and effective marketing, thereby enabling our success with our four key business drivers. Our first key driver is expanding our business in international markets. Revenue in international grew 15% in the first quarter compared to the same period in the prior year, including strong gains in each of our three international regions, EMEA, the Americas ex-US, and APAC. The EMEA region remains the biggest driver of growth. We continue to buck the trend in Europe and deliver solid growth there despite the challenging operating environment. Our Middle East JV has strong momentum and is ramping quickly. And our JV in South Africa continues to see explosive growth, driven by the exceptional brand heat we have in that market. Our second key business driver is growing our business outside of footwear. In the first quarter, overall accessories and apparel revenue rose 73%, or 28%, excluding the newly acquired Almost Famous business. Our Steve Madden handbag business continues to be outstanding. Revenue there increased more than 45% compared to the same period in the prior year for the third consecutive quarter. Steve Madden Apparel also saw strong growth, increasing 23% in the quarter, driven by additional doors and expanded assortments within key wholesale accounts. And Almost Famous contributed $41 million in revenue in its first full quarter under our ownership. A critical part of our strategy with this acquisition is to utilize the almost famous platform to introduce and build a Madden Girl apparel business. We launched Madden Girl apparel in Macy's in the first quarter, and initial sell-through performance has been very strong. Our third key business driver is expanding our direct-to-consumer business led by digital. DTC revenue grew 13% compared to the first quarter of 2023. including double-digit percentage gains in both digital and brick-and-mortar channels. We achieved these top-line results while also meaningfully expanding DTC gross margin as the combination of on-trend merchandise assortments and effective inventory management enabled us to increase full-price selling and reduce discounting. And finally, our fourth key business driver is strengthening our core U.S. wholesale footwear business. This business was under pressure in 2023, as many of our largest wholesale customers entered last year with too much inventory and reduced orders significantly in order to right-size inventory levels. Fortunately, those wholesale customers have much healthier overall inventory levels this year, and as expected, we were able to return to year-over-year growth in the U.S. wholesale footwear business in the first quarter, with revenue increasing 5% compared to Q1 of 2023. While our wholesale customers for branded product remain cautious overall, our private label business, which is primarily done in the mass channel, has improved significantly and experienced strong growth in the quarter. So overall, we delivered tangible results across each of these areas, which not only drove strong top-line performance, but also enabled us to expand our consolidated operating margin for the quarter to 11%. up from 10.3% in the first quarter of 2023, despite a headwind from the inclusion of Almost Famous. Looking ahead, our first quarter performance and the success we are seeing across each of our key strategic initiatives gives us confidence that we are not only on track to meet our financial goals for 2024, but that we are well positioned to continue to drive sustainable top and bottom line growth for years to come. And now, I'll turn it over to Zine to review our first quarter financial results in more detail and provide our outlook for 2014.
Steve Madden Apparel
ZINE ZINE- Thanks, Ed, and good morning, everyone. In the first quarter, our consolidated revenue was $552.4 million, a 19.1 percent increase compared to the first quarter of 2023. Excluding Almost Famous, consolidated revenue grew 10.3 percent compared to the same period in the prior year. Our wholesale revenue was $438.2 million, up 21% to the first quarter in the prior year, or 9.7%, excluding Almost Famous. Wholesale footwear revenue was $295.7 million, a 4.7% increase from the comparable period in 2023, driven by strong growth in the private label business. Wholesale accessories and apparel revenue was 142.6 million, up 78.6% to the first quarter in the prior year, or 27.4%, excluding the almost famous. Our Steve Madden handbag business was the primary growth driver, and Steve Madden Apparel also saw a strong gain. In our direct-to-consumer segment, revenue was 112.3 million, a 12.8% increase compared to the first quarter of 2023, Brick and mortar revenue grew 15% or 8% on a comp store basis, and owned and operated e-commerce revenue rose 11%. We ended the quarter with 253 company-operated brick and mortar retail stores, including 69 outlets, as well as five e-commerce websites and 25 company-operated concessions in international markets. Turn into our licensing segment. Our licensing royalty income was $1.8 million in the quarter compared to $2.1 million in the first quarter of 2023. Consolidated gross margin was 40.7% in the quarter versus 42.1% in the comparable period in 2023. The inclusion of Almost Famous negatively impacted consolidated gross margin by approximately 120 basis points. Wholesale gross margin was 35.1% compared to 37% in the first quarter of 2023, driven primarily by the impact of Almost Famous and a mixed shift in wholesale footwear to the private label business. Direct-to-consumer gross margin was 61.9%, up 270 basis points from the comparable period in 2023, driven by a reduction in promotional activity. Operating expenses as a percent of revenue were 29.7% down from 31.8% in the first quarter of 2023. Operating income for the quarter was $61 million, or 11% of revenue, up from 47.7 million, or 10.3% of revenue in the comparable period in the prior year. The effective tax rate for the quarter was 23.5% compared to 24.2% in the first quarter of 2023. Finally, net income attributable to Steve Madden Limited for the quarter was $47 million or $0.65 per diluted share compared to $37.6 million or $0.50 per diluted share in the first quarter of 2023. Moving to the balance sheet, our financial foundation remains strong As of March 31, 2024, we had $143.1 million of cash, cash equivalents, and short-term investments, and no debt. Inventory at the end of the quarter was $202 million, up 12.2% to the prior year, or 7.2%, excluding almost famous. Our CapEx in the first quarter was $4 million. During the first quarter, the company spent $37.3 million on repurchases of its common stock, including shares acquired through the Net Settlement for Employee Stock Awards. At the end of the quarter, there was approximately $143 million remaining on the share repurchase authorization. The company's board of directors approved a quarterly cash dividend of 21 cents per share. The dividend will be payable on June 21, 2024, to stockholders of record as of the close of business on June 10, 2024. Turning to our outlook, we are maintaining our annual guidance. We continue to expect revenue for 2024 to increase 11% to 13% compared to 2023, and we continue to expect diluted EPS to be in the range of $2.55 to $2.65. Now I would like to turn the call over to the operator for questions. Didi?
Operator
Thank you. As a reminder, to ask a question, please press star 1 1 on your telephone and wait for your name to be announced. To withdraw your question, please press star 1 1 again. Please stand by while we compile the Q&A roster. And our first question comes from Paul Ledgeway of Citi. Your line is open.
Paul Ledgeway
Hey, thanks, guys. A couple questions. Curious if you can talk about what was better than planned relative to your expectations during the quarter, if anything. And then also, we'd love to hear about the comp drivers within the DTC business from the traffic, first ticket, AUR perspective, what you're seeing, and anything you can share about the start to 2Q relative to 1Q. Thanks.
Ed
Sure. Yeah. In terms of first quarter, we did come in modestly ahead of our internal forecasts. I will point out that I think the street had modeled the year a little bit different from us, or I should say that the street was in line with us for the full year, but had modeled the quarters a little bit differently. And so our internal forecast was higher than the streets for first quarter. So while we exceeded Our own internal expectations, it was not by the amount that we exceeded the street expectations, but we were slightly ahead pretty much across the board. We were slightly ahead of our internal forecast on revenue, across each of wholesale footwear, wholesale accessories, and DTC, and even had slightly better gross margin performance on a consolidated basis. In terms of the comp drivers in DTC, Look, traffic has still been weak. Traffic has been negative. Conversion has been, you know, not great but a little better. But where we got some nice benefit was in AUR and also UPT, so a nice overall increase in average transaction value. And I think the last question was about the performance in April. month to date in DTC. That has been a little bit softer than what we saw in Q1, but that was expected. That's how we modeled it, in part due to the Easter shift. And we still feel that we're on track to be where we thought we'd be for DTC, not only for Q2, but for the year. And we're still looking at that high single-digit overall DTC revenue growth for the year. We had always planned that it would be slightly, you know, we did 13% in Q1. We'd always planned a little bit of a slowdown to the balance of the year.
Paul Ledgeway
Got it. Thank you. Good luck.
spk13
Thank you. One moment for our next question. And our next question comes from Sam Poser of Williams Training.
Operator
Your line is open.
Sam
Good morning. Thanks for taking my questions. Well, first of all, Ed and Zane, you were one minute off the last time, 12 minutes instead of 11 on the prepared, still very good, better than everybody else. Anyway, on the branded wholesale business, how was that? And can you tell us about sort of, you talked about caution from those retailers. Can you talk about what's going on there, and I'll probably have a follow-up to whatever you say on that, and then I have one other thing.
Ed
Yeah, the branded wholesale business remains, at least on the footwear side, remains a bit challenging. We continue to see a pretty cautious approach from the big retailers. As you know, many of our largest customers on the branded wholesale in the branded wholesale footwear business, are still comping negative and having some challenges in their own business. And I think that we're feeling the impact of that. Many of them, as we've been talking to them about their additional fall plans, I think it looks like the sentiment there is still pretty cautious. The fashion boot business was not great last year. I think people are playing that part of the business conservatively. So overall, while certainly better than last year, we're still seeing quite a bit of caution on that front.
Sam
Was that branded footwear business up in the quarter?
Ed
No, no, sorry, I should have told you that. It was down low singles in the quarter.
Sam
And is there a difference, I'm going to ask this hopefully in a way you could answer it, is there a difference between those retailers that write orders to you and your vendor-managed
Ed
program retailers? We always like to have as much input as possible with our wholesale customers about what they're bringing in, and we partner with everybody as closely as we can, and we'll continue to do that.
Sam
Did your vendor-managed partner retailers outperform the others?
Ed
Sam, there's not a lot of us. I'm not going to start telling you about how we're doing with individual customers.
Sam
All right. And then how should we think? I mean, it looks to me like, including myself, the estimates regarding the how to think about almost famous was wrong. So can you give us some idea of how to think about, you know, how big that business is again and the flow of how to think about that? I mean, you did $40 million in the quarter. How should we think about how that looks now? by quarter? I mean, just so we aren't, everybody's not way off base again.
Ed
Yeah, I think that the, you know, it's roughly, this is about the quarterly revenue that they should do throughout the quarter. It's going to bounce around a little bit. We'll do a little bit more than this going forward per quarter, but there's not heavy seasonality here where you're going to see, you know, it should still be in this kind of, you know, low to mid 40s each quarter.
Steve Madden Apparel
Sam, that applies to pretty much the expenses as well. The flow is pretty similar by quarter.
Sam
Okay. All right. Well, thank you very much. Good luck. Talk to you in a bit. Thank you.
Operator
Thank you.
spk13
One moment for our next question. And our next question comes from Jay Saul of UBS.
Operator
Your line is open.
spk06
Terrific. Thank you. Ed, you mentioned one of the company's key strategies is to expand DTC led by digital. I'm sort of curious about the stores aspect of DTC. You know, how are you feeling about the stores that come to data this year? And is there a plan to work in some of the almost famous apparel, you know, for the Steve Madden brand into the stores? Can you just maybe talk about how you're thinking about that opportunity? That'd be helpful. Thank you.
Ed
Sure, yeah. We're pleased with what we're seeing out of DTC so far this year. Obviously a pretty significant acceleration from where we were in 2023. In Q1, getting to 13% overall DTC growth. And you asked about the brick-and-mortar storage in particular. We did have an 8% brick-and-mortar comp store sales gain in Q1, so that's quite healthy, and we were pleased with that. We are also adding some stores this year. Again, those are really primarily or almost all driven from international markets, and we're very pleased with the returns that we're seeing when we do open international stores right now. In fact, seeing a better return ROIC in those stores than what we're getting in the U.S. In terms of apparel in the stores, look, that's pretty limited today. We don't, you know, most of our stores are not set up for apparel, don't have dressing rooms and such. But in some of the international markets, we are starting to introduce more apparel and have seen some early success there that's pretty encouraging.
spk06
Got it. And if I could just ask one more just about Almost Famous on the margins. If we just think about big picture trajectory over this year, next year, how much opportunity do you see today to improve the margins in the Almost Famous business?
Ed
Yeah, good question. So I think you'll recall that when we acquired it, the business had about a 7% EBIT margin. And our goal was over time to get that into the high singles. And Really, I think that there is an opportunity to get into the low doubles. We're already starting to see some improvement there. So this year, we're looking at, if you're comparing apples to apples to the 7% that they were doing prior to our acquisition, we're looking at about 8%. So we've already gotten about 100 basis points this year. Now, keep in mind, in our reported financials, we're still showing more like 7% because there's some amortization of intangibles associated with the transaction that offsets that. But again, on an organic basis, we're getting about 100 basis points here. And I think that I'd like to think there's a path to getting about 100 basis points a year for the next, let's say, three years.
spk06
Got it. Okay. Thank you so much. Thanks, Jay.
Operator
Thank you. One moment for our next question. And our next question comes from Janine Stichter of BTIG. Your line is open.
Janine Stichter
Hi, good morning. So I want to ask about the AUR increases. You mentioned that being a driver of the retail business. How much of that was price increases you took on certain items versus just consumers gravitating towards higher price items? And then maybe more broadly, if you could just comment on where we are in kind of the fashion cycle, how you feel about the trends that are out there right now and how well they play into your business. Thank you.
Ed
Sure. Yeah. So in terms of the AUR, that's primarily... it's really not us taking price on like-for-like items. I think there are two things happening. One, we're getting a bit of a mixed benefit based on the products people are buying this year compared to last year. And then also because we did pull back on promotional activity in DTC channels, that's also contributing to an AUR increase. In terms of the fashion cycle and the trend environment, I think it's Certainly improved over where we were last year. There's some newness in the market, and we're pretty excited about some of the trends we're seeing, some of the things that are working for us. This spring that I would call out, we're having a lot of success with sandals, footbeds, particularly high footbeds, what we call platforms, are performing very well for us. We've also got some slides that are great. Slingbacks are working on flats as well as kitten heels. And then I think one of the things that we're having some fun with and that we're seeing a lot of success with is there's a lot going on with materials and ornamentation. So raffia, pearls, buckle treatments, flowers, mesh. There's just a lot going on there that we can capitalize on. And the design team is really executing there. So feel good about that.
Janine Stichter
Great, thank you. And then maybe just one more. When we think about the 11% operating margin for the year, can you just remind us what's happening with marketing expense in there? How is it trending as a percent of sales?
Steve Madden Apparel
Marketing expenses are, we continue to invest in marketing, both in the U.S. and globally, so that's going up high single digits.
Operator
Great, thanks so much. Thank you.
spk13
One moment for our next question. And our next question comes from Aubrey Tianello of BNP Paribas.
Operator
Your line is open.
spk01
Hey, good morning. Thanks for taking the questions. Ed, I'd love to get your take on what you're seeing from the consumer right now. Last couple of quarters, you talked about the consumer being more price conscious, more responsive to promos, outlets outperforming full price stores. Just curious how you're seeing consumer behaviors evolve so far this year.
Ed
Yeah, good question. I think that mostly the story is still the same there. So I still think that overall consumer demand for discretionary goods, fashion goods, is still relatively – it's not the most robust environment I've ever seen. It's relatively metered out there when we talk to many of our key wholesale customers and other players in the industry. And we do see a customer that still is price sensitive. So, again, we had an outlet business in the U.S. that significantly outperformed full price in terms of comps. We've been talking about roughly 1,000 basis point differential or even more, and we saw that again.
spk01
Yeah, and then if I could just follow up on the operating margin, 11% in 1Q is in line with your 2024 guidance. I know it's been a while since we've had a normal year, but historically, I think 1Q operating margins are usually a little bit lower than the full year. Just curious if there's anything abnormal to call out in terms of timing on SG&A investments or just how we should think about the phasing of EBIT margins this year.
Steve Madden Apparel
I think if you recall last year, we had some timing of expenses on the SG&A side, and we think we were up about 10% versus 2022 in Q1, and that's kind of causing most of that shift.
Ed
Yeah, and I think just to follow up on that, yeah, I still think that that 11% is the right way to think about the full year.
spk01
All right, thank you.
spk13
Thank you. One moment for our next question. And our next question comes from Corey Charlo of Jefferies.
Operator
Your line is open.
Easter
Good morning and thanks for taking my questions. I was just wondering if you could perhaps dimensionalize how much the Easter shift impacted your business in the quarter. And then you also made some pretty encouraging commentary about your private label business in Mass. I was wondering if you could provide a little bit more detail about what you're seeing there.
Ed
Sure. In terms of the Easter shift, it really wasn't that meaningful for us. We did also move a friends and family promotion back a couple weeks, which offset part of that Easter shift for us. So it wasn't a big needle mover in the quarter. And then in terms of the private label footwear business, yeah, we're pretty pleased about what we're seeing there. Again, that's almost all done in the mass channel. And as we've talked about on previous calls, that was the channel where the big customers identified they had too much inventory in discretionary categories earliest and pulled back and so we felt the pain there first, but we're also feeling the recovery there first, and we've seen a nice bounce back in that business, and our private label footwear business is up about well north of 30% in Q1, and we expect to see another very strong quarter in that business in Q2.
Easter
That's great. And then just one quick follow-up to an earlier question. I think you mentioned that your almost famous margins have increased about 100 basis points. What was driving that? I'm curious what the reasoning behind that is.
Ed
Yeah, most of that's coming in the form of gross margin. As you know, one of the strategies that we, or one of the part of the rationale, a big part of the rationale for doing the deal was to use almost famous as the platform to do Madden Girl Apparel and Madden NYC Apparel. And as we build those businesses, which are obviously associated with a billion-dollar-plus brand and with pricing power, we think there's some opportunity to get some margin, and we're starting to see that.
Easter
Great. Super helpful. Thank you so much.
Operator
Thank you.
spk13
One moment for our next question.
Operator
And our next question comes from Laura Champine of Loop. Your line is open. Thanks for taking my question.
Laura Champine
Your handbag business is just showing great growth, and I'm wondering if that growth is weighted significantly to any given channel or if it's more broad-based?
Ed
We're really seeing strength across all the channels that we have Steve Madden handbags in. So that's something that we're pretty excited about. And look, we've been talking about this for a number of years on these calls now, but this is an area that we have made a lot of investment in and put a lot of focus on over the last several years. And we're just really pleased that we think that's really paying dividends. I think it all, for us, really always starts with product. And I think that we have worked very hard to build a product engine in Steve Madden handbags that rivals what we have in shoes and is really consistently creating a trend-right product with great styling and quality that has a great price-value proposition that the customer is responding to. And so that is translating to success really across channels. So it's the You know, the U.S. wholesale channel is great, but we're also seeing growth in DTC. It's been a big driver of our international growth. And, you know, look, this is a business that over the last five years is up high teens on a compounded annual growth basis in revenue. So this is not something that's necessarily just, you know, we didn't just start having some success here. You know, this has been a multi-year growth journey.
Laura Champine
are there any points of distribution where you really are under-penetrated in handbags, where you can use the success you've had in same doors to open new doors for handbags, or do you think that you're fully penetrated at retail?
Ed
Well, look, I mean, I think that there's tons of runway internationally, and we've got great momentum there, so there's lots of opportunity for new distribution points there. In the U.S., we're probably in most of the the channels that we want to be in, but we can grow within those channels. But I think that our number one focus in the U.S. is going to be growing in our own direct-to-consumer channels. Got it. Thank you. Thanks, Laura.
Operator
Thank you.
spk13
One moment for our next question.
Operator
And our next question comes from Dana Telsey of Telsey Advisory Group. Your line is open.
Dana Telsey
Yeah, good morning, everyone. As you think about the wholesale channel returning to growth, how did off-price do? And are we continuing to see the strength in the off-price retailers? Any change there in that particular channel? And then on the stores, you had mentioned last time beginning a remodel process. Where are you in that? Is it beginning? And lastly, Ed, do you see acquisitions out there? What would you be looking for? What would be attractive? Thank you.
Ed
Great. Thanks, Dana. So in terms of the off-price channel, yeah, that remains, obviously, at least in the U.S., maybe the healthiest channel. Certainly, if you look at their comp store sales from those big retailers, they're exceeding what you're seeing from a lot of the other channels. And, yeah, the demand there for our products and our brands remains very strong. So that is definitely an area where we are seeing growth. Obviously, just want to always remind you that we also make sure that we keep the distribution balanced and don't get overweighted in that channel as well. In terms of remodels, yes, that is in progress and we're going to be continuing to remodel stores throughout the year. And pretty excited for you all to see what we've got coming, especially in some of our flagship locations in places like New York City. And then in terms of acquisitions, look, we're always going to keep our eyes and ears open and we'll be opportunistic. I don't know that there's a lot of color I can tell you on exactly what acquisitions what we would do. But if we find another brand to add to the portfolio that's complementary to what we do and where we can add value and make a difference, that's certainly something we would look at.
Dana Telsey
Got it. And then just one follow-up on international. Where are you seeing the strength there? Do you see the type of increase you had, the 40s increasing going forward? Is it wholesale? Is it DTC? And any particular regions that you'd call out with accelerated growth? Thank you.
Ed
Yeah, so the nice thing about, in particular, what we saw in first quarter was it was really balanced growth. We saw strong growth across each of our big international regions, again, those being EMEA, the Americas, XUS, and APAC. But the biggest driver of growth has really been EMEA. And as we pointed out in the prepared remarks, we continue to grow in Europe, despite the fact that it's a challenging operating environment over there, and a lot of folks are seeing... Their business has declined. We're still growing there. We're pretty excited about our new Middle East joint venture, and we're getting a lot of traction there and excited about the growth plans we have in that market. And we've been calling out South Africa. It's obviously not a huge market, but we're seeing really explosive growth there, and so that's a nice contributor as well. In terms of wholesale versus DTC, we're seeing expansion in both channels, But we are more penetrated in DTC in international relative to the U.S. And we think more of the growth will come from DTC channels in the coming years.
Operator
Thank you. Thank you.
spk13
One moment for our next question.
Operator
And for our next question, we have a follow-up from Sam Poser of Williams Trading. Your line is open.
Sam
Thanks for taking my follow-up. This is some follow-ups to everybody's questions. One about international, and then two about private label competition at wholesale and DTC. I mean, it looks to me like your DTC business is showing off the strength of the Steve Madden footwear brand. And my guess is your outlet business isn't all giving stuff away, given the margins. But on the wholesale side, retailers seem unwilling to step up to the degree the product may be selling through relative to your DTC business. So the question is, with international and DTC, how do you get the penetration high enough How long is it going to take to get the penetration high enough to offset the big wholesale customers not stepping up appropriately?
Ed
Well, look, we're on a path to, and we have been making each of those businesses considerably more important and bigger pieces of our pie. I mean, if you go back to to 2019, I think international was about 11% of our business, and now it's around 19, 20% of our business. If you look at direct-to-consumer in 2019, I think it was 18% of the business, and now it's about a quarter of the business, or maybe a little higher. So we are increasing the penetration, It takes time, and we've got to go step by step here, but we do anticipate that each of those businesses will continue to increase in penetration and become more important to the overall over time.
Sam
Does it take more marketing? I mean, does it mean maybe coming out with a bigger campaign to drive people to you and to the brand overall and, you know, stepping up some, you know, you know, just some really new, you know, enticing advertising, you know, which you've had great success in the past, you know, of doing?
Ed
Well, look, we have, you know, we have been significantly increasing the marketing investment over the last several years. You know, if you go back a handful of years, we were down below 2% of revenue in marketing, and you've seen that number rise consistently. year after year, and now we're around 4.5% of revenue, and we've indicated we think that'll continue to go north. Whether that entails much bigger, splashier marketing campaigns or whether we deploy those dollars differently is something that we're continually looking at, but we are committed to investing in the brands and investing in enhanced marketing for our brands.
Sam
Thanks very much.
Ed
Thanks, Sam.
Operator
Thank you. I'm showing no further questions at this time. I'd like to turn it back to Ed Rosenfeld for closing remarks.
Ed
Great. Well, thanks so much for joining us today. Have a great day, and we look forward to speaking with you on the second quarter call.
Operator
This concludes today's conference call. Thank you for participating and you may now disconnect.
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