- Skechers reported record quarterly sales on Thursday.
- The earnings report slightly disappointed Wall Street.
- Executives expect “incredibly strong” demand for slippers this year.
Kizik and Nike aren’t the only brands fighting to bring laceless sneakers to store shelves.
Skechers reported record quarterly sales on Thursday, and executives said that despite some “recession signs” in the market, they expect a strong second half, buoyed by robust demand for its new slippers.
“The early signs were incredibly strong from a consumer perspective,” Chief Financial Officer John Vandemore said on a conference call with equities analysts.
Skechers already sells several models of slip-on sneakers.
Utah-based Kizik and industry leader Nike are also investing in slip-on technology to meet rising demand. Nike is an investor in Kizik and recently introduced a slip-on Jordan.
Skechers stays hot with consumers. For the quarter, it reported record revenue of $1.88 billion, up 13.5%. But the company’s stock slipped slightly after the earnings report, likely due to an outlook that fell below expectations.
The company expects first-quarter revenue of $1.8 billion to $1.85 billion, according to Factset, down from the $1.95 billion previously expected by Wall Street analysts. It expects 55 cents to 60 cents of earnings per share, also below the 86 cents previously expected by analysts.
“This year is really going to be another two-half story,” said Vandemore. “In the first half we see the challenges. In the second half we see a lot of opportunities.”
(According to a preliminary transcript compiled by AlphaSense/Sentieo, executives and analysts used the word “half” 43 times during the call.)
Challenges in the first half include: Covid-related issues in China and a US market still struggling with overstocking and supply chain hiccups.
Among the chances in the second half: slip-on shoes.
“We have…some ongoing product launch activities that I think will really drive the market for Skechers in the second half of the year, particularly our slip-in products,” said Vandemore. “That’s really when they start hitting the market with full force.”