Birkenstock missed the Q2 sales estimate. Investors sent the stock down in early trading.
But the firm spent the call telling investors why nothing has really changed.
Sales rose 7.7% to €618.3 million. That's 14% in constant currency. The Street wanted €620.3 million.
The miss was thin. But it was enough to spook buyers after months of clog and sandal hype.
Net income fell 22% to €81.9 million. That's down from €105.1 million a year ago.
Adjusted EPS came in at €0.45. That's well below the €0.59 estimate.
Gross margin fell 380 basis points to 53.9% from 57.7%. Three things drove the squeeze. U.S. tariffs. A bad FX move. And a one-time markup tied to the buyout of its Aussie distributor last October.
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The Middle East war cost the firm about €6 million in lost sales in EMEA. That figure comes from a William Blair note.
Half of the hit came from missed shipments. The other half came from soft EU demand. The war pushed gas prices and inflation higher.
By region, Asia kept driving sales with growth up 22%. The Americas grew 4%. EMEA grew 10%.
So every region still grew. Even with the war hit.
DTC sales rose 4%. B2B sales rose 9%. The wholesale channel held up better than the firm's own stores in the quarter.
CEO Oliver Reichert said the firm still expects 13% to 15% sales growth in constant FX this year. That's the same range it has held all year.
Adjusted gross margin guidance also held at 57.0% to 57.5%.
Reichert's pitch has three parts. APAC is growing twice as fast as other regions. The closed-toe shoe mix keeps growing into clogs and boots. Price hikes are also starting to offset the tariff and FX hit.
Birkenstock opened five new owned stores in the quarter. The total now sits at 111.
The retail buildout is why capex guidance now runs €110 million to €130 million for the year.
The premium sandal space is one of the most-watched corners of consumer retail. The trade-down test for inflation hits high-end brands first.
So if Birkenstock can hold full-year guidance through the back half of the year, the story stays intact.
If tariff drag widens, or APAC slows, the same guidance will start to look hopeful instead of solid.
Shares of the firm have had a strong run since the 2023 IPO. So this miss is the first real bump in the road for new investors.
Sandal season is just starting in the U.S. and Europe. That gives Birkenstock a few months to make up the lost ground. The next read comes in late summer.
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