Skechers Faces Market Challenges Amid Trade Uncertainties And Tariff Impacts
$SKX
Skechers USA Inc. (NYSE:SKX), a prominent player in the global footwear industry, kicked off fiscal year 2025 with its strongest Q1 performance yet, reporting record sales of $2.41 billion, up 7.1% from the $2.25 billion in Q1 2024. This growth was powered by both international and domestic momentum—international sales climbed 7.2%, while U.S. sales rose 6.9%.
The company’s wholesale segment led the charge with a 7.8% increase ($110.5M), especially in EMEA, where sales surged 13%. The Americas followed with a solid 7.3% rise, although Asia-Pacific saw a slight 0.6% dip. Volumes grew 9.1%, but average selling prices declined slightly (-1.3%).
Direct-to-consumer revenue also performed well, up 6.0% or $49.5 million. Gross profit totaled $1.25 billion, a 6.2% increase YoY, but gross margin slipped 50 basis points to 52.0% due to pricing pressures. Despite topline growth, operating earnings fell 11.3% to $265.1 million. Net income also dipped by 2% to $202.4 million, while EPS rose slightly to $1.34, compared to $1.33 last year.
CFO John Vandemore praised the brand’s continued global momentum, crediting “innovative comfort technologies” and the “distinctive value” of its product lineup. Skechers ended the quarter with 5,318 stores worldwide and recently launched its first Performance store in Canada.
The company reported a revenue of $2.41 billion, marking a 7.1% increase from the previous year but still falling short of the expected $2.44 billion. The company’s ability to adapt to these external pressures will be crucial in maintaining its competitive edge and financial stability in the challenging times ahead. As Skechers continues to adjust its business strategies, the industry will closely watch how these changes help the company stabilize and potentially regain its footing in the global market.
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