Author: Thomas J. Ryan

Athletic categories again delivered strong mindshare among teens with athletic footwear gaining share among females, according to Piper Sandler’s 44th Semi-Annual Generation Z Fall 2022 Survey. Nike and Lululemon were the most popular brands among teens in the active lifestyle space. Other popular brands included Converse, Crocs, Shein, On, and PacSun, while Vans, Adidas and Under Armour lost ground with teens.

At VF Corp.’s Investor Day, Nicole Otto, global brand president, The North Face, highlighted major growth plans for trail/hike, footwear and owned stores while unveiling the brand’s new mission statement expected to guide growth over the next five years.

Cowen issued a report offering a dismal view of holiday spending as it sees trends across discretionary spending weakening and inventories reaching peak levels to drive markdown pressures. The investment firm said it’s “cautious” on third-quarter and fourth-quarter guidance for Under Armour, Burlington Stores, Adidas, Allbirds, Hanesbrands, Puma, PVH, Skechers, and Figs. 

At VF Corp.’s Investor Day, Kevin Bailey, Vans’ global brand president, said the skate brand is “far from done in our growth potential” while detailing a series of missteps that recently slowed the brand’s growth. Bailey said, “Most of the recent challenges of the brand are executional and at the brand.”

Levi Strauss reduced its guidance for its fiscal year ended November 30 while reducing inventory buys for the first half of 2023 by approximately 25 percent due to ongoing supply chain disruption and macro-economic pressures, particularly in the U.S. and Europe.

Last week Nike, Inc. warned that it would have to aggressively promote in the coming months as inventories in its latest quarter ballooned 44 percent year-over-year due mainly due to pandemic-driven supply chain disruptions. Other retailers in the active lifestyle space likewise face inventory surges, although they are hopeful of avoiding excessive markdowns.

On Helen of Troy’s second-quarter conference call, Julien Mininberg, CEO, said Hydro Flask’s market share was “down slightly” in the year-to-date period as retailers are more cautious about replenishment and orders stemming from concerns over a slowdown in consumer spending.

In a meeting at Morgan Stanley’s Global Sporting Goods Day, ​John Vandemore, Skechers’ CFO, said the company is well-positioned to gain market share in the challenging economic climate and benefitted from major footwear brands reducing their wholesale distribution to emphasize direct-to-consumer growth.

Analysts reduced their price targets for Nike after the company warned that gross margins would remain under pressure over the next few quarters as promotions would be required to clear bloated inventories. Most still held positive ratings on the stock on faith in Nike’s long-term fundamentals.

Shares of Nike Inc. are down about 12 percent in mid-day trading Friday after the company reported better-than-expected results for the first quarter ending August 31 on healthy demand but warned that gross margins would remain under pressure through the year as promotions would be required to clear bloated inventories. Inventories ended the quarter ahead 44 percent year over year, including 65 percent in North America, its largest market.

Thor Industries reported record fourth-quarter results, but warned that towable order activity had softened due to successful dealer restocking combined with lower consumer confidence and macroeconomic uncertainty.

VF Corp.’s management team forecasted healthy growth under its new five-year plan announced during Investor Day, its first since 2019. However, it slashed its outlook for the current fiscal year primarily due to continued underperformance by Vans and an expected greater promotional environment than anticipated in North America in the back half of 2022.

At its Investor Day last week, Sportsman’s Warehouse announced plans to double the pace of new store openings over the next three years to grow sales on average by 10 percent annually through 2025.

Wall Street was impressed by the consumer- and product-led strategies laid by Columbia Sportwear’s top executives last week to drive growth at its first-ever Investor Day, but several felt near-term macroeconomic pressures will present challenges to meeting goals.