Puma shares dropped 16% on Friday after the German sportswear model mentioned it now expects an annual loss as gross sales decline and US tariffs dent revenue.
Puma has been struggling to draw customers as re-released retro sneakers, such because the Speedcat, haven’t offered in addition to hoped, and CEO Arthur Hoeld, within the position since July 1, mentioned the corporate must “course-correct.”
“This year, 2025, will be a reset for Puma and 2026 will be a transition year for us,” mentioned Hoeld, previously gross sales chief at Adidas, who was appointed by Puma’s board in April to show efficiency round.
“We as a company need to take a hard look at ourselves,” he mentioned on a convention name with journalists. “We do have tremendous potential with a brand that hasn’t been unlocked yet, but a brand that also requires a reset and a new way forward.”
Hoeld mentioned he deliberate to assessment Puma’s development plan and strengthen the standard of wholesale distribution, and that he would give a broader roadmap on his technique for Puma by the tip of October.
“Puma is facing an existential identity crisis in terms of relevance in a sporting goods industry that is more competitive, and at a time when the largest player Nike is staging its comeback from Autumn/Winter ’25,” mentioned RBC analyst Piral Dadhania.
Tariff hit
US tariffs will cut back Puma’s gross revenue this 12 months by about 80 million euros ($94 million) regardless of efforts to offset the ache, together with US worth hikes within the fourth quarter, Chief Monetary Officer Markus Neubrand mentioned. He declined to say how a lot costs would go up.
Sportswear retailers like Nike, Adidas and Puma depend on Southeast Asian nations like Vietnam for the sneakers and garments they import into america, making them particularly uncovered to tariffs.
Puma frontloaded shipments of products from Asia forward of successive US tariff deadlines, Neubrand mentioned, driving stock ranges up and contributing to extra discounting.
Most Puma merchandise offered in america are made in Vietnam, Cambodia, and Indonesia, Neubrand mentioned, and the corporate goals to chop its sourcing from China to the US farther from 10% at the moment.
In preliminary earnings launched late on Thursday, Puma mentioned annual gross sales would decline by at the very least 10%, having beforehand forecast low to mid-single-digit development.
Puma’s second-quarter currency-adjusted gross sales of 1.94 billion euros had been weaker than analysts anticipated, with North America gross sales dropping 9.1% and Europe down 3.9%.
The corporate didn’t say how massive the annual loss was prone to be. It beforehand forecast earnings earlier than curiosity and tax of between 445 million euros and 525 million euros for the 12 months.
Puma additionally lower its capital expenditure plans for the 12 months to 250 million euros from 300 million euros beforehand.
