Skechers Revenue Jumps 13% in Fiscal Q2

Core Insights - Skechers reported Q2 2025 GAAP revenue of $2.44 billion, a 13.1% increase year-over-year, exceeding analyst estimates [1][5] - Non-GAAP revenue reached $2,410 million, surpassing the estimate of $2,351.54 million, with non-GAAP earnings per share matching expectations at $0.83 [1][2] - The company experienced declining margins, with gross margin falling to 53.3% from 54.9% and operating margin decreasing to 7.1% from 9.6% year-over-year [1][7] Financial Performance - Net earnings attributable to Skechers U.S.A. increased by 21.5% to $170.5 million compared to $140.3 million in Q2 2024 [2] - International sales rose by 22.0%, with the Europe, Middle East, and Africa region showing a notable 48.5% increase to $731.5 million [5] - Domestic sales remained stable, with wholesale down 7.5% to $413.3 million, while Direct-to-Consumer sales rose 7.6% to $448.8 million [6] Business Overview - Skechers designs and markets a variety of footwear and apparel, focusing on comfort and innovation, with proprietary technologies like Hands Free Slip-ins and Arch Fit insoles [3][4] - The company has been expanding its international presence and direct-to-consumer channels, emphasizing comfort-based technologies and brand marketing [4] Operational Developments - Operating expenses increased by 15.4%, leading to operating costs rising to 46.2% of sales, driven by higher brand marketing and distribution expansion costs [8] - The impact of foreign currency movements positively affected reported results, contributing $33.9 million to sales and $0.30 to diluted earnings per share [8] Future Outlook - Management did not provide specific financial guidance due to uncertainties in global trade dynamics and consumer behavior [10] - Key issues for investors include managing margin pressure, the impact of new tariffs, and the ongoing sales slump in China [11]