Skechers U.S.A. (SKX) Q2 2024 earnings summary

Executive summary

• Achieved record Q2 sales of $2.16 billion, up 7.2% year-over-year, with strong global demand and growth in both Wholesale and Direct-to-Consumer segments; constant currency sales up 8.7%.

• International Direct-to-Consumer and domestic Wholesale led growth, increasing 15% and 14% respectively, with all regions seeing sales increases.

• Gross margin improved to 54.9%, up 220 bps year-over-year, driven by lower freight costs and favorable DTC mix.

• Diluted EPS was $0.91, down 7.1% year-over-year, due to higher operating expenses and a higher effective tax rate.

• Announced a new $1 billion share repurchase program, replacing the previous authorization.

Financial highlights

• Q2 sales reached $2.16 billion, up 7.2% year-over-year; constant currency sales were $2.19 billion, up 8.7%.

• Gross profit increased 11.7% to $1.18 billion; gross margin up 220 bps to 54.9%.

• Operating income was $206.5 million, down 5.1% year-over-year; operating margin was 9.6%, down from 10.8% last year.

• EPS was $0.91, down 7.1% year-over-year; constant currency EPS was $0.97, flat year-over-year.

• Ended the quarter with $1.55 billion in cash and over $2.3 billion in liquidity.

Outlook and guidance

• Raised full-year 2024 guidance: sales expected at $8.875–$8.975 billion and EPS at $4.08–$4.18.

• Q3 2024 sales expected at $2.3–$2.35 billion and EPS at $1.10–$1.15.

• Capital expenditures for 2024 anticipated at $325–$375 million.

• Management remains committed to achieving $10 billion in annual sales by 2026.