Amer Sports, Inc., the parent of Arc’teryx, Salomon and Wilson, among others, reported that its Ball & Racquet Sports (Wilson Sports) segment revenue increased 11 percent year-over-year to $300 million as inventories normalized in the market and replenishment orders accelerated.
Ball & Racquet Sports, primarily comprised of the Wilson Sports business, increased 11 percent y/y to $300 million in the third quarter. The growth trend represents a significant sequential increase from Q2, when sales were up only 1 percent in reported terms and 2 percent in constant-currency terms. Adjusted operating margin increased 600 basis points y/y to 6.9 percent of sales for the quarter.
“Our constant innovation and top quality products have allowed Wilson to take share during these past few quarters of inventory re-balancing,” offered Amer Sports CFO Andrew Page on a conference call with analysts. “We are very pleased with the strong rebound and continue to expect Ball & Racquet Sports to grow low- to mid-single digits long term.”
Page said the return to double-digit growth was led by its marquee racquet sports franchise, as well as the small but fast growing softgoods segment. Inflatable balls and golf also reportedly returned to growth in the third quarter.
“Our Tennis 360 strategy continues to be a key driver for the Wilson franchise, led by footwear and apparel growth, performance racquets, acceleration and expansion of Wilson Tennis 360 shops in China, as well as paddle and pickleball growth,” Page noted.
Amer Sports CEO James Zheng added that while still in its early stage, the company’s Tennis 360 strategy is proving to be a key driver for the Wilson franchise, led by apparel and fall clothing and accelerating expansion of Tennis 360 shops in China.
Zheng said growth was boosted by Wilson’s Roger Federer racquet line and the growing popularity of tennis in China following Zheng Qinwen’s Olympic gold medal.
“We saw record sales at our U.S. Open shop earlier this fall, and our new line of Roger Federer premium performance racquets, bags and accessories, launched in August, has been extremely successful in the first months, driving the strong growth in our key performance racquet segment with potential growth in Q3 as retail inventories normalize and the retail begins accelerating replacement orders,” Zheng noted.
The Ball & Racquet Sports segment’s adjusted operating profit margin increased 600 basis points year-over-year to 6.9 percent of sales. This increase was primarily driven by an increase in new product launches this year, which carried higher gross margins and were supported by lower discounting, given the inventory clearance that began last year in Q3.
“Looking ahead, we are confident that our market share and flow of innovative products positions Ball & Racquet Sports well in Q4, when we face our easiest comparison and also have our strongest pipeline of new products,” Page concluded.
The company sees Ball & Racquet Sports revenue growth of ~4 percent and segment operating margins of low- to mid-single-digit percent for the full year 2024.
Image courtesy Wilson Sports/Amer Sports, Inc.
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See below for additional SGB Media coverage of the broader Amer Sports business for the third quarter.
EXEC: Amer Sports Sees Sharp Contrast Between West and East in Q3; Provides China Update
EXEC: Arc’teryx Outperforms Once Again in Q3 Despite Tough 2023 Comps
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