Dive Brief:
- Skechers reported Thursday sales of $2.02 billion during its third quarter, a 7.8% increase, according to a company press release.
- The footwear giant’s third quarter sales again marked a record for the company, after it reached similar milestones for the first and second quarters.
- However, the company experienced a $17 million decline in its wholesale business, a 1.4% decrease, while its DTC business increased 23.8%. Wholesale volume decreased 10.8%, though average selling price increased 10.3%.
Dive Insight:
In their conference call with investors, Skechers executives attributed the wholesale decline to lower distributor sales in the quarter, which sent the international wholesale business down 2%. Domestic wholesale was “significantly better than expected,” Skechers COO David Weinberg said, as it was level with the prior year’s results.
Weinberg said the company remains optimistic about growth in its domestic wholesale business in 2024, after what he called a difficult year. CFO John Vandemore said the company isn’t “convinced yet” that domestic wholesale will be down in the fourth quarter.
“[W]e haven’t yet seen the trigger of accelerated deliveries coming out of many of the wholesale accounts, some of whom are still cautiously watching the consumer spending market,” Vandemore said. “Our view is that our full-year perspective hasn’t changed much. It’s up a little, but it’s not distinctly different.”
Meanwhile, Skechers’ DTC sales grew $163.6 million for the quarter to $850.4 million, with a bulk of the increase coming from the EMEA region where sales rose 60.8%. The Americas region grew 17.3% in the category, and sales in the APAC region increased 24.2%.
“As we continue to focus on growing our international business, enhancing our Direct-to-Consumer presence and expanding our product offering, we remain confident in the strength of our brand and executing Skechers’ long-term growth strategy,” Weinberg said in the release.
Skechers’ third quarter earnings followed its announcement earlier this week that it is entering the professional basketball market. The launch includes two new mid-top style shoes meant to combine technology with comfort, per the company. Also this quarter, the brand debuted its multi-year sneaker partnership with Snoop Dogg.
