Skechers has reported record Q2 (second quarter) results thanks to a 17.9% increase in international sales and a 29.1% increase in direct-to-consumer sales, however its domestic sales were down by 4.6%.
Skechers chief financial officer John Vandemore commented: “Despite anticipated headwinds in the domestic wholesale market, we successfully navigated the challenges and achieved record quarterly sales in addition to a new second-quarter earnings record.”
Direct-to-consumer channels experienced significant growth, reaching $212m, with noteworthy increases in the Americas (28.2%), APAC (25.1%), and EMEA (47.2%).
However, wholesale sales decreased by 5.9% to $67.3m, primarily due to a decline in the Americas (18.7%). However, this was partially offset by increases in APAC (14.3%) and EMEA (7.4%).
Summary of Skechers Q2 results
- Net earnings for the quarter were $152.8m
- Operating expenses increased by 13.4% to $842.8bn compared to last year which was at $743.4bn and operating margin was 10.8% compared to 8.3% the year prior.
- Gross margin was 52.7%
David Weinberg, chief operating officer at Skechers added: “Our strong gross margin of 52.7% was primarily driven by a higher proportion of direct-to-consumer sales, which grew 29%. We were able to deliver our product more effectively and improve our inventory levels, which enabled robust sales across our comfortable, innovative, stylish and high-quality collections.”
Looking ahead, The company anticipates sales between $1.95bn and $2.0bn in the third quarter of fiscal 2023 and reiterated its future goal of $10bn in annual sales by 2026.
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“The second quarter marked yet another sales record and a new milestone as we made the Fortune 500 list of largest companies, a testament to the strength of our brand and the dedication of our entire organisation to consistently create, innovate and meet the footwear needs of consumers,” added Robert Greenberg, Skechers’ chief executive.