Skechers Q3 sales increase 20.5 percent, sets target of 10 billion dollars by 2026

Skechers U.S.A., Inc. reported a third quarter sales increase of 20.5 percent as a result of a 14.9 percent increase domestically and a 24.6 percent increase internationally, driven by strength in wholesale sales.

For the fourth quarter of 2022, the company believes it will achieve sales between 1.725 billion dollars and 1.775 billion dollars and diluted earnings per share of between 30 cents and 40 cents.

“Skechers’ ability to deliver record quarterly sales of 1.88 billion dollars was a significant accomplishment, reflecting the ongoing global demand for our comfort technology products, which resulted in double-digit growth in our wholesale and direct-to-consumer segments,” said David Weinberg, chief operating officer of Skechers.

Highlights of Skechers’ Q3 results

The company said, all segments experienced growth, with wholesale increasing 26.2 percent and direct-to-consumer increasing 11.9 percent. On a constant currency basis, sales increased 27.3 percent.

The company’s wholesale sales growth of 247.1 million dollars or 26.2 percent, was led by increases in EMEA of 58.8 percent and AMER of 18.1 percent. Wholesale volume increased 25.1 percent and average selling price increased 1.4 percent.

Direct-to-Consumer sales growth was 72.8 million dollars or 11.9 percent led by increases in AMER of 13.8 percent and APAC of 10 percent. Direct-to-consumer volume increased 11.1 percent and average selling price increased 0.6 percent.

Gross margin was 47.1 percent, a decrease of 280 basis points. Earnings from operations decreased 16.2 million dollars or 11.1 percent to 130 million dollars, while net earnings were 85.9 million dollars and diluted earnings per share were 55 cents, a decrease of 16.7 percent over the prior year.

Skechers posts 19.6 percent sales growth in the year-to-date results

The company’s year-to-date sales increased 19.6 percent reflecting a 19.3 percent increase domestically and a 19.8 percent increase internationally with the largest contribution derived from wholesale sales.

Both segments experienced increases, with wholesale increasing 25.6 percent and direct-to-consumer increasing 10 percent. On a constant currency basis, the company’s total sales increased 23.8 percent.

Wholesale sales growth of 731.4 million dollars or 25.6 percent, was led by increases in AMER of 31.7 percent and EMEA of 34.8 percent. Wholesale volume increased 20.8 percent and average selling price increased 4.4 percent.

Direct-to-consumer sales growth of 179.6 million dollars or 10 percent, was led by increases in AMER of 9.3 percent, EMEA of 27.6 percent, and APAC of 6.7 percent. Direct-to-consumer volume increased 3.4 percent and average selling price increased 6.3 percent.

Gross margin was 46.8 percent, a decrease of 290 basis points. Earnings from operations decreased 45.1 million dollars to 460 million dollars, while net earnings were 297.5 million dollars and diluted earnings per share were 1.90 dollars, a decrease of 12.4 percent over the prior year.

Commenting on the outlook, Robert Greenberg, chief executive officer of Skechers said: “As we continue to grow towards our goal of 10 billion dollars in annual sales by 2026, we remain as focused and as dedicated as we were from the year we started Skechers.”