Core Viewpoint - Skechers has agreed to be acquired by 3G Capital for $63 per share, representing a 30% premium over the average stock price in the last 15 trading days, with the deal expected to close in Q3 2023 [1] Group 1: Acquisition Details - The acquisition aligns with both companies' long-term growth visions, with 3G Capital focusing on long-term investments and operational management [2] - Post-acquisition, Skechers will become a private company, retaining its current leadership team [2] - 3G Capital has shifted from its aggressive past to allow Skechers' existing team to transfer equity into the new private company [2] Group 2: Business Strategy and Performance - Skechers plans to continue its current strategic initiatives, including product innovation, international market expansion, and enhancing direct-to-consumer (DTC) operations [3] - In Q1 2025, Skechers reported sales of $2.41 billion, a 7.1% increase year-over-year, with net profit rising 37% to $209 million [3][4] - Despite overall growth, the Chinese market, a key growth driver, faced a 16% decline in sales year-over-year in Q1 2025 [4] Group 3: Market Position and Future Outlook - Skechers has made strategic adjustments in product development and marketing to address market challenges, focusing on comfort technology products [5] - The company maintains a strong commitment to the Chinese market, which accounts for over 90% of its products being manufactured locally [5]

Core Insights - Skechers reported a first-quarter revenue of $2.41 billion for 2025, a 7.1% increase year-over-year, but profits slightly decreased to $202.4 million from $206.6 million in the previous year [1][3] - The Chinese market, Skechers' largest overseas market, experienced a significant sales decline of 16% year-over-year in the first quarter of 2025, following a 0.9% decline in 2024 [3][4] - Skechers aims to achieve a global annual sales target of $10 billion by 2026, with a specific goal of reaching 30 billion yuan in sales from the Chinese market [1][5] Financial Performance - In Q1 2025, Skechers' sales reached $2.41 billion, with a fixed exchange rate sales figure of $2.46 billion, reflecting a 9% increase [1] - Profit for the same period was $202.4 million, slightly lower than the $206.6 million reported in Q1 2024 [1] Market Analysis - The Chinese market's sales decline is notable, with a 16% drop in Q1 2025 and an 11.5% decline in Q4 2024 [3][4] - Skechers has opened nearly 3,500 stores in China, with over 90% of products sold being "Made in China" [3] Strategic Focus - Skechers plans to invest in product development, marketing, and infrastructure in China, emphasizing the market's growth potential [4] - The company is focusing on exploring lower-tier markets in China, targeting cities like Xi'an, Chengdu, and Wuhan, which are seen as significant opportunities [5] Product Strategy - Skechers is positioning itself as a "comfort technology" brand, differentiating from traditional sports brands by emphasizing products like Air-Cooled Memory Foam and Goga Mat [5] - The company has signed high-profile athletes in football and basketball to enhance brand visibility and expand its product line [7] Competitive Positioning - Skechers' pricing strategy places it between high-end brands like Nike and Adidas and lower-end domestic brands, providing a competitive edge, especially in lower-tier markets [6]

斯凯奇全球首席执行官Robert Greenberg认为："三十余年来，斯凯奇始终专注于提供舒适、创新、时尚 且价格合理的高品质产品，这已成为品牌成功的基石。第一季度创纪录的销售额充分印证了品牌的强大 韧性，见证全球市场的广泛需求。当前，斯凯奇差异化的价值主张将愈发重要。" 斯凯奇全球首席财务官John Vandemore也称："第一季度的业绩表现反映了斯凯奇全球业务的持续强 劲，彰显品牌创新舒适科技产品以及独特价值主张的巨大吸引力。我们依然对自身应对当前市场挑战的 能力充满信心。凭借过往在全球范围管理这一多元化品牌的成功经验，以及品牌独特而富有竞争力的产 品组合，斯凯奇将在这一时期保持坚韧，并有望蓬勃发展。" 2025年斯凯奇回归舒适初心，立足"舒适科技"核心战略定位，为全年龄段消费者提供全方位的舒适体 验，致力于通过全民运动生态建设，推动健康生活方式普及，赋能中国市场的长远发展。 斯凯奇中国 合伙人，斯凯奇中国、韩国及东南亚首席执行官陈伟利表示："中国市场对斯凯奇而言有着重要的战略 地位，我们始终对其增长潜力保持充分信心，并恪守'在中国，为中国'承诺。我们将不断加大对产品创 新、营销升级和供应链优化的投入 ...

Financial Data and Key Metrics Changes - The company achieved record first-quarter sales of $2.41 billion, a 7.1% increase year-over-year, and $2.46 billion on a constant currency basis, up 9% [8][27] - Earnings per share were $1.34, essentially flat compared to the prior year [34] - Gross margin was 52%, down 50 basis points from the previous year, primarily due to lower average selling prices from higher promotions in certain markets [31] Business Line Data and Key Metrics Changes - Direct-to-consumer sales grew 6% year-over-year to $879.4 million, with domestic growth of 11% driven by strong e-commerce performance [27][17] - Wholesale sales increased 7.8% year-over-year to $1.53 billion, with international sales up 9.5% [28][16] - The company ended the quarter with 5,318 Skechers stores worldwide, including 1,821 company-owned locations [18] Market Data and Key Metrics Changes - Domestic and international sales both increased by 7%, with EMEA growing 14% and The Americas growing 8.3% [9][14] - In the Asia Pacific region, sales decreased by 2.6%, primarily due to soft consumer spending in China, but grew 12% when excluding China [10][30] Company Strategy and Development Direction - The company views international markets as its primary growth engine, investing in retail store networks and enhancing distribution efficiencies [10][21] - Skechers aims to expand its distribution centers in the U.S., China, and Europe to manage expected growth and improve delivery efficiency [20][21] - The company is focused on evolving and innovating its footwear to meet consumer needs and drive demand globally [21][42] Management's Comments on Operating Environment and Future Outlook - Management acknowledged increasing macroeconomic uncertainty and waning consumer sentiment but expressed confidence in navigating these challenges [9][26] - The company remains committed to its strategic plan and believes it is well-positioned to thrive despite current market dynamics [26][42] - Management did not provide specific revenue or earnings guidance due to the dynamic environment but remains optimistic about growth opportunities [39][38] Other Important Information - Inventory increased by 30% year-over-year to $1.77 billion, primarily due to elongated transit times, but decreased by 7.6% compared to the prior quarter [35][36] - Capital expenditures for the quarter were $147.1 million, focusing on distribution infrastructure and new store openings [36] Q&A Session Summary Question: Can you discuss the company's production in China and tariff strategies? - Management emphasized that they are looking at sourcing optimization, vendor cost sharing, and pricing adjustments to manage tariffs, with two-thirds of the business being outside the U.S. [49][51] Question: What markets are experiencing notable volatility? - The U.S. and China are noted as presenting the most uncertainty, with robust consumer demand for Skechers products remaining strong in most other markets [60][62] Question: How do you view the potential for price increases in response to tariffs? - Management indicated that pricing is being considered but will depend on consumer receptiveness and the overall impact on the business [78][80] Question: What is the company's approach to inventory management amidst tariff changes? - The company is managing inventory closely, with a focus on minimizing at-risk inventory and ensuring high fidelity to delivery [97][99] Question: Are there specific products that are currently made in China and not in Vietnam? - Management noted that most kids' footwear is produced in China due to quality and cost considerations, but they have the ability to back up production in multiple locations [145]