Skechers announces Q3 sales increase but lowers full-year expectations

Global footwear brand Skechers has today announced financial results for the third quarter, ending 30 September 2021. The results show a year-over-year sales increase of 19.2%, reaching a total of $1.55 billion.

Third quarter sales increased 19.2% as a result of a 20.1% increase in domestic sales and an 18.6% increase in international sales. Domestic and international growth was driven by increases in both direct-to-consumer and wholesale, as COVID-19 impacts continued to ease. On a constant currency basis, total sales increased 17.1%.

Sales grew across all segments with increases to domestic wholesale of 10.1%, international wholesale of 10.6%, and Direct-to-Consumer of 44.1%. DTC sales grew across all channels, led by domestic and international retail stores.

Direct-to-Consumer comparable same store sales increased 31.0%, driven by an increase of 33.7% domestically and 25.1% internationally.

Operating expenses increased $94.5 million (17.6%). Selling expenses increased by $33.8 million due to higher global advertising costs. General and administrative expenses also increased by $60.7 million (13.5%), primarily as a result of higher labor costs as well as increased rent and warehouse and distribution expenses.

David Weinberg, Chief Operating Officer of Skechers, said: “Skechers achieved a new third quarter sales record surpassing $1.5 billion for the period, a remarkable achievement given the on-going supply chain disruptions. The record quarter was the result of double-digit improvements in both our domestic and international businesses compared to the third quarter 2020, reflecting the relevancy of our product globally and a normalising retail environment.

“As we look to the fourth quarter and into the first half of 2022, we believe supply chain constraints will remain a challenge, although we are beginning to see progress in key global ports, especially in Europe and other international markets. Nonetheless, we are proud of the execution of our global team to deliver our comfort technology footwear to retail stores and our partners around the world to meet the strong demand for Skechers products.”

Robert Greenberg, Chief Executive Officer of Skechers, added: “While we supported our business with pervasive advertising campaigns globally, we also focused on developing new product, creating what we believe is our strongest offering yet. This includes a growing seasonal collection, with styles comprised of recycled materials and building on our Fit offerings with consumers’ comfort in mind. Our accomplishments were many during the quarter—including remaining the third largest athletic footwear company in the world and achieving a new quarterly sales record for the period. That said, we believe the best is yet to come for Skechers.”

Year-to-date sales increased 41.7%, reflecting a 42.4% increase in domestic sales and a 41.2% increase in international sales - with the largest contribution derived from International Wholesale growth. On a constant currency basis, Skechers total sales increased 37.4%.

For the full 2021/22 financial year, Skechers has confirmed it now aims to reach sales between $6.15 billion and $6.20 billion, slightly below its previous target of between $6.15 billion and $6.25 billion.