Shares of Birkenstock (BIRK 6.11%) — well-known for its contoured footbed sandals — had been up 11% this week as of three:30 p.m. ET Thursday, in accordance with knowledge offered by S&P World Market Intelligence.
The vertically built-in footwear specialist reported second-quarter earnings on Thursday, delivering gross sales and adjusted earnings-per-share progress of 19% and 34%.
Administration additionally stated that 2025 income progress ought to hit the excessive finish of its 15% to 17% steering, and it additionally elevated its expectations for profitability.
Birkenstock hopes to outrun the competitors
In virtually each measure, Birkenstock had a wonderful Q2 as the corporate:
- beat analysts’ expectations and raised steering
- improved its margin profile
- grew gross sales by double digits throughout all three of its geographic areas
- elevated each business-to-business and direct-to-consumer gross sales by 19%
- noticed its youthful closed-toe shoe class develop gross sales twice as quick as its sandals
- averted tariff considerations because of its vertical integration and manufacturing in Germany and Portugal
Picture supply: Getty Pictures.
Not solely is Birkenstock largely unaffected by tariff considerations, nevertheless it may be positioned to thrive amid the uncertainty.
So far, Chief Govt Officer Oliver Reichert defined,
We’ll navigate these unsure instances from a place of power. Our decades-long observe document of managing our model by means of a constant engineered distribution technique places Birkenstock in an enviable place to take extra shelf house and acquire share.
Stated one other means, in 1 / 4 the place most footwear shares scrambled to keep away from tariffs and keep income, Birkenstock grew its profitability whereas experiencing double-digit unit-volume progress alongside a mid-single-digit enhance in common promoting value.
Rising gross sales by 20% yearly during the last decade and sporting a 21% free-cash-flow (FCF) margin, Birkenstock deserves an extended look from buyers at an affordable 26 instances FCF.
