Dive Brief:
- Birkenstock Holding reported second quarter revenue of 481 million euros, or about $521 million at current exchange, marking a 22% year-over-year increase, according to a news release Thursday.
- The company’s DTC and B2B segments each saw revenue grow by 30% and 19%, respectively. The company, which has been focused on global expansion, saw similar results in each of its geographic regions, with the Americas growing by 19%, Europe by 22%, and the Asia Pacific Middle East and Africa region growing by 39%.
- In response to the results, the company now expects revenue of about 1.78 billion euros, an overall increase of about 19% in the fiscal year. It previously expected revenue to range between 1.74 billion and 1.76 billion euros for the year.
Dive Insight:
Thursday’s results marked the second quarterly earnings report since the Germany-based footwear company became publicly traded.
When Birkenstock last reported in January, it experienced a 20% revenue increase, yet its shares dropped 10% following the announcement. At the time, analysts said these kinds of results weren’t unexpected given the nuances of becoming a public company, and noted that financial results were a better indicator of a brand’s success.
In the latest report, CEO Oliver Reichert said the company was seeing growing demand for its products.
“Given our engineered distribution model, demand continues to outpace supply in all segments, channels and categories,” Reichert said in Thursday’s release. “We see strong demand growth in largely untapped white space areas we have identified across geographies, channels, categories and usage occasions.”
As part of its expansion plan, Birkenstock is opening a new plant in Pasewalk, Germany. The company said this facility will provide them with the bandwidth and flexibility “to expand its footprint into underpenetrated segments and categories.” Birkenstock also expects a financial impact from this plant in reduced gross margin and Adjusted EBITDA margin by 220 basis points, per the release.
Birkenstock additionally attributed some of Q2’s revenue growth to increased sales of its closed-toe shoes, which increased to more than 25% of total revenue compared to the high-teens a year ago, per the release.
