Shen Wan Hongyuan: The performance of most international sports brands exceeded expectations, and domestic outdoor and cost-effective brands performed better

The Zhitong Finance App learned that Shen Wan Hongyuan released a research report saying that according to the latest fiscal quarter, the performance of Deckers, Adidas, VF, Nike, and Lululemon exceeded expectations, and Puma's revenue and profit were still under pressure, but overall it was in line with expectations. Looking ahead to the next fiscal quarter, Nike and VF brands are cautious, but most sports brands, such as Adidas, expect annual revenue growth of about a single digit. In terms of inventory, Adidas's inventory increased significantly year over year, mainly to ensure that World Cup related products can be supplied in a timely manner. Overall, the performance of most international sports brands in 25Q3 exceeded expectations, and domestic sports brand sales margins weakened, but specialty brands, high-performance outdoor, and new sports branches nurtured structural opportunities.

Shen Wan Hongyuan's main views are as follows:

International sports brands: The performance of most brands has exceeded expectations, and sports brand earnings are generally picking up

According to the latest fiscal quarter, Deckers/Lululemon/Adidas/VF/Nike/PUMA's revenue was +9.1%/+3.0%/+1.6%/+1.1%/-15.3%, respectively, and net profit to mother was +10.7%/-12.8%/+4.1%/+263.7%/-30.8%/profit changed from profit to loss. Among them, Deckers, Adidas, VF, Nike, and Lululemon's performance exceeded expectations, and Puma's revenue and profit were still under pressure. But overall it was in line with expectations.

International sports brands are cautious about their guidance for the next fiscal quarter, and their full-year performance guidelines are neutral and optimistic

Outlook for the next fiscal quarter: Nike expects revenue for the next fiscal quarter to decline by a lower number of units, but the decline is narrower month-on-month; against the backdrop of VF's latest fiscal quarter revenue growth of 1.6% (-1% year on year after excluding exchange rate factors), revenue for the next fiscal quarter is expected to fall 1-3% year on year. The guidelines are cautious.

Annual guidance: Most sports brands expect a single-digit year-on-year revenue growth rate. Deckers expects FY26 revenue to be 5.35 billion US dollars (up 7% year over year), Adidas expects FY25 revenue to increase 9% year over year, Lululemon expects FY25 revenue to increase 4% year on year, and Puma expects FY25 revenue to drop by double digits year on year.

By region, sales in North America/US are still under pressure, and Greater China and Europe are showing a recovery trend

According to the latest fiscal quarter: North America/US: Adidas/Lulullemon/PUMA/VF/Deckers revenue -4.7%/-3.0%/-22.3%/-0.9%/-1.7% YoY, Nike revenue +4.0% YoY. Consumption in North America is sluggish, and growth of most brands is weak.

Greater China: Lululemon/Adidas/Nike was +42.4%/+0.1%/-9.2%. As demand in mainland China improved and inventory adjustments went smoothly, sales pressure on some brands in Greater China weakened sequentially. Lululemon bucked the trend by opening new stores and optimizing e-commerce channels.

Europe/EMEA: Adidas/VF/Nike's revenue was +8.2%/+6.3%/+6.0% year over year, and Puma's revenue was -9.4% year over year. The performance of each brand was divided, but the overall trend was recovering.

Inventory situation: Nike's inventory removal continues to advance, and Adidas is preparing stocks in advance for the World Cup

At the end of the latest fiscal quarter, Nike's inventory value was -1.7% year over year. Among them, the EMEA and Greater China regions went smoothly. Inventory in North America increased year on year, mainly due to the impact of US tariffs, and actual inventory volume declined year on year. The inventory value of adidas/Lulululemon/PUMA/Deckers/VF was +20.9%/+17.3%/+7.4%/-10.9% year-on-year. Among them, Adidas inventory increased significantly year-on-year, mainly to ensure that World Cup related products can be supplied in a timely manner, purchased in advance and stored in advance to ensure that retailers can replenish goods in a timely manner when demand grows and maintain supply chain reliability.

Domestic sports brands: sales margins weakened in 25Q3, and vertical outdoor and cost-effective brands performed better

The Anta outdoor brand increased, and the main brand downgraded guidelines: in 25Q3, the Anta brand and FILA grew by a low number of units, and other brands grew by 45-50%, continuing the strong trend. Considering the weak consumer environment in the third quarter, the company lowered the Anta brand guidelines from a growing number of units to a low number of units. Step's performance is steady: the omni-channel traffic of the main brand of Xtrex increased by a low number of units year-on-year, and the number of units of the Sokoni brand increased by more than 20% year-on-year in the third quarter. 361 degrees continued double-digit growth: the main brands and offline sales of children's clothing both increased by about 10% year-on-year, and e-commerce sales grew by about 20%.

Aspect of the target

Based on the global sports brand development trend, it suggests the direction of investment in the sports industry chain: global supply chain manufacturers: Shenzhou International (02313), Huali Group (300979.SZ), Xinao (603889.SH), Weixing (002003.SZ), Blum Oriental (601339.SH); sports outdoor brands: Bosideng (03998), Anta (02020), Taobo (06110), 361 degrees (01361), it is recommended to pay attention to Bosch (01361), and Li Ning (02331). International (01368).

Risk Alerts

Global demand growth falls short of expectations; brand inventory removal; industry competition intensifies; global trade uncertainty.