Skechers U.S.A. (SKX) Q3 2024 earnings summary

Executive summary

• Achieved record quarterly sales of $2.35 billion in Q3 2024, up 16% year-over-year, with EPS of $1.26, a 35.5% increase, driven by strong global demand and growth across all channels and regions.

• Wholesale sales rose 21% to $1.42 billion; Direct-to-Consumer sales increased 9.6% to $931.7 million.

• International sales grew 16.4% and domestic sales 15.3% year-over-year; EMEA led with 30% growth.

• China sales declined 5.7% due to macroeconomic pressures, but long-term confidence in the market remains.

• Repurchased $90 million of Class A common stock in Q3; $910 million remains under repurchase authorization.

Financial highlights

• Q3 2024 gross margin was 52.1%, down 80 bps year-over-year due to higher promotional activity and lower average selling prices.

• Operating margin for Q3 was 9.9%, down 60 bps year-over-year; operating income was $233.4 million, up 9.5%.

• Net earnings attributable to Skechers were $193.2 million, up 32.9% from $145.4 million.

• Inventory rose to $1.71 billion, up 24% year-over-year and 11.9% from December 31, 2023.

• Ended quarter with $1.6 billion in cash and $2.42 billion in liquidity.

Outlook and guidance

• FY2024 sales expected at $8.925–$8.975 billion, EPS at $4.20–$4.25, up 12% and 21% respectively at midpoint.

• Q4 sales guided to $2.165–$2.215 billion, EPS $0.70–$0.75.

• Effective tax rate for the year expected at 18–19%; capital expenditures forecasted at $375–$400 million.

• Management reaffirms confidence in achieving $10 billion in sales by 2026.

• Liquidity remains strong with $1.35 billion in cash and $571.1 million unused credit capacity.