Dive Brief:
- Sportswear giant Puma saw an adjusted sales increase of 6% to 2.3 billion euros, or about $2.4 billion at current exchange rates, in its Q3 earnings announced Tuesday.
- Puma’s wholesale and DTC business units both experienced increases in the quarter, by 3.1% and 17.4%, respectively. The company attributed its DTC strength to its “brand momentum” as well as retail store expansion and “store productivity.”
- Puma’s footwear segment remains its strongest, with an 11.3% boost in footwear sales. Its accessories business grew 4.2%; however, apparel sales declined 0.5%.
Dive Insight:
Last quarter, Puma experienced a 5.9% growth in Q2, compared with the same period last year.
Pippa Stephens, senior apparel analyst for GlobalData, said in an email to Fashion Dive that the deceleration reflects that consumers are more carefully considering their purchases amid inflation.
“One consolation [for Puma] is that its key competitors Nike and Adidas have also recently experienced slowdowns, highlighting that sportswear overall is being impacted by financial pressures, with Nike’s revenue growing by just 2.0% in its Q1 to the end of August 2023, and Adidas' declining by 6% in its Q3 to the end of September 2023,” Stephens said.
Puma’s net income for Q3 decreased by 10% to 131.7 million euros.
The company stated that its inventory had normalized to what it called an appropriate level, at about 1.87 billion euros this year, down from 2.35 billion euros in the same period last year.
Puma’s sales in EMEA increased 9.9%, while its Asia Pacific region also grew by 4.6%. Sales in the Americas region increased 2.5%, despite a decline in North America, per the release. Puma attributed the decline to “macroeconomic headwinds and PUMA’s relative dependency on the off-price Wholesale business.”
For the first nine months of the year, Puma’s wholesale and DTC businesses increased 7.3% and 22%, respectively. In that period, its footwear segment led growth with a 19% increase, while apparel and accessories grew 1.6% and 1.8%, respectively.
Puma reaffirmed its full-year outlook and anticipates currency adjusted sales growth in the high single-digit percentage range for 2023.
Puma’s earnings were released after it announced several high-profile collaborations with musicians. Earlier this week, it named A$AP Rocky creative director for its F1 partnership. The long-term creative relationship will allow for A$AP Rocky to design bespoke capsule collections. Stephens said this deal could allow the brand to draw in more consumers and “cement its fashion credentials among younger shoppers.”
Meanwhile, the collaboration between Puma and Rihanna, called Fenty x Puma, launched in September with a footwear collection. Puma boasted “strong demand” for that capsule’s Avanti shoe style in its earnings report.
