Mips AB President and CEO Max Strandwitz said in his third quarter letter to investors that the helmet technology company saw “good development” during the quarter despite the fact that the tariffs in the important U.S. market continue to create uncertainty for customers, the helmet brands, and for the retail chains.
The company reported sales grew 10 percent in its third quarter, boosted by 19 percent organic growth. The gains were achieved despite higher helmet prices resulting from U.S. tariffs. Operating earnings were said to be “down slightly” due to legal costs and currency headwinds.
“During the quarter, consumers began to experience higher prices for helmets in-store, as a result of price increases implemented by the helmet brands to manage tariff costs,” the CEO noted in his letter. “Consumer demand has despite that been good and we expect this positive trend to continue and look forward to a return to more normal levels of demand.”
“Despite the challenges consumer goods companies with significant exposure to the U.S. have faced during the year due to major and sudden tariff announcements, we have once again been able to demonstrate the strength of our business model and our offering,” Strandwitz said in his October 22nd note. “We are growing in all three of our categories and are seeing good progress in both the U.S. and Europe.
“The uncertainty surrounding tariffs for the U.S. market has challenged everyone in our industry,” he continued, noting that the company’s customers have generally navigated well in this environment. He acknowledged that customers have, among other things, implemented price increases to offset tariff related cost increases, which he said have been “received better than many expected” by retailers and consumers.
“The imposition of tariffs has meant that many of our customers have started to look into helmet manufacturing in countries other than China. This has taken up a lot of their internal development resources, and has limited their focus on product development of new and better products, which in turn has also decreased the inflow of new customer projects to Mips,” the CEO suggested.
Strandwitz said it was positive to note is that Mips was now back to the same number of started customer projects as last year after a few quarters of fewer projects being started together with customers as they were more focused on relocation rather than product development.
“In early April, the imposition of high tariffs on goods imported into the U.S. was announced,” Strandwitz explained in an earlier letter to investors and media in the company’s second quarter report in July. “The tariff package was extensive and larger than most people had expected, creating uncertainty in all our customer categories and cautious purchasing behavior among our customers, the helmet brands. As much of the rhetoric centered on China, where most helmets are currently produced, many factories had to reduce production significantly. As the brands gained more clarity, they communicated price increases to mitigate the impact of tariffs. These were relatively well received by retail and consumers, and thereby the helmet brands started producing helmets at their suppliers again. As a result, we saw an acceleration in the end of the quarter, but sales did not reach the growth we saw in the previous quarter.”
The Sweden-based maker of helmet protection technologies reported net sales increased 1 percent to SEK 135 million in the 2025 second quarter, compared to SEK 133 million in Q2 2024, due to currency fluctuations. Organic growth was pegged at 12 percent in the quarter. The U.S. dollar had a negative 8 percent impact on reported sales and the Chinese yuan had a negative 4 percent impact. While strong organic growth was exhibited, the quarter fell short of the very strong 42 percent growth posted in the 2025 first quarter.
“Operating profit decreased this quarter compared to last year, which is entirely due to legal costs and negative effects of exchange rate differences. The legal costs amounted to SEK 13m and relate to a lawsuit which one of Mips’ US customers is a party to. As previously communicated, Mips is not a party to the suit, but since the suit concerns areas where Mips has intellectual property rights, being an important cornerstone of our brand strength, Mips has chosen to engage to secure the best possible outcome. Mips’ own intellectual property rights are not part of this suit.”
Third Quarter Results
Sales increased by 10 percent to SEK 135 million (~14.3 million) in the third quarter, while organic sales growth, adjusted for currency effects, increased by 19 percent.
Mips AB reports in the Swedish krona (SEK) currency. All currency translations to U.S. dollars ($) or European Commission euros (€) were completed at the day of the report’s publishing, unless otherwise noted.
The gains were said to be mainly driven by Europe, with growth of 73 percent to SEK 45 million (~€4.1 million) and Sweden, with growth of 121 percent to SEK 15 million. North America revenues declined 8 percent to SEK 64 million (~$6.8 million). The “substantial” concentration of sales in North America was said to be due to the large number of helmet manufacturers based in the region.
Gross margins improved to 74.2 percent of net sales, compared to 73.4 percent in the year-ago period.
Operating profit amounted to SEK 44 million, down from SEK 48 million the prior year. Operating cash flow increased to SEK 41 million against SEK 36 million.
Diluted earnings per share amounted to SEK 1.29 in the quarter, down from SEK 1.37 per share in Q3 last year.
Sport Helmet Category
The helmet sports category achieved growth of 8 percent in the quarter, despite a significant negative impact from currency effects.
Strandwitz said, “It is rewarding to see that despite a challenging bike market, we have now delivered volume growth for the eighth quarter in a row in the bike sub-category. The European market continued to drive growth, but we also saw positive development of our sales within bike in the US market in spite of that the overall sales development in the helmet market has been soft.
“We saw a somewhat negative development in the snow sub-category this quarter, driven by phasing of order placements from some of our larger customers. When we sum up the progress so far this year, we still see a continued positive overall development in this sub-category as well.”
Motorcycle Helmet Category
In the Motorcycle helmet category, sales increased by 28 percent in the quarter, partly offset by negative currency effects. The quarter marked a return to positive growth.
Strandwitz said, “Both the on-road and off-road sub-categories developed well, and sales started to recover after the imposition of the US tariffs. This quarter we launched our new event concept at an MXGP competition in Lommel, Belgium. The launch was very successful and well received by our customers as well as consumers. Through our new event concept, we will have the opportunity to increase our activation towards our end consumers to a greater extent.”
Safety Helmet Category
In the Safety category, Mips achieved a 26 percent increase in sales this quarter, partly offset by negative currency effects.
Strandwitz said, “We are seeing continued uncertainty around tariffs and related cost increases in the sector. However, we consider this to be of a temporary nature and believe we will be able to maintain a high growth rate in the Safety category going forward.
“A helmet rating test for safety helmets was introduced at Virginia Tech in the U.S. this quarter, which is something we welcome. As the current design of this helmet test only addresses head impacts without significant elements of rotation, we look forward to a more comprehensive test methodology in the future that will also address more accident scenarios on construction sites. As these types of tests are refined and expanded, we believe that the importance of rotational protection will also become clearer, which we look forward to.
“We received great recognition at NSC Congress & Expo in the U.S., with four helmets equipped with Mips’ safety system listed as top ranked, of which one helmet was awarded ‘Best in Show.’ This is evidence of the great work we have accomplished in product development.”
Strong Position And Positive Outlook
Strandwitz concluded, “Despite the challenges consumer goods companies with significant exposure to the US have faced during the year due to major and sudden tariff announcements, we have once again been able to demonstrate the strength of our business model and our offering. We are growing in all three of our categories and are seeing good progress in both the US and Europe. The uncertainty surrounding tariffs for the US market has challenged everyone in our industry, but our customers have generally navigated well in this environment and, among other things, implemented price increases to offset tariff related cost increases, which have been received better than many expected by retailers and consumers.
“The imposition of tariffs has meant that many of our customers have started to look into helmet manufacturing in countries other than China. This has taken up a lot of their internal development resources, and has limited their focus on product development of new and better products, which in turn has also decreased the inflow of new customer projects to Mips. Positive to note is that we in the third quarter now are back to the same number of started customer projects as last year after a few quarters of fewer projects being started together with our customers’, since they have focused on relocation rather than product development.
“We continue to gain market share, have a stronger and broader product range than ever, a unique brand position, and we continue to invest in marketing and product development, which are our key priorities. Given all that, we look forward to an exciting end to the year and an interesting 2026.”
Image courtesy Mips AB
