Puma SE saw a significant drop in its shares, the largest in decades, after the German sportswear giant reduced its full-year forecast due to weak global demand. Jefferies described the preliminary earnings report as a “major profit warning,” while RBC warned of an “existential identity crisis” as Puma struggles to maintain relevance in international markets.
The key points from the preliminary earnings release include lower-than-expected second-quarter sales, a revised full-year outlook, and concerns about the impact of U.S. tariffs. Inventories are on the rise as demand for Puma products continues to decline.
The revised guidance for fiscal year 2025 paints a troubling picture for the company, with expected negative EBIT including tariffs and restructuring costs. Sales are now projected to decline by a low double-digit percentage, a significant departure from previous guidance of low-to-mid single-digit growth.
Analyst Natasha de la Grense from Goldman Sachs noted that Puma’s second-quarter performance and revised forecast for the year indicate worsening trends in the second half of the year. The company may face wholesale order cancellations and inventory repurchases, leading to significant challenges in the coming months.
Other analysts from Jefferies, RBC, and Citi also expressed concerns about Puma’s performance and outlook, highlighting issues such as weak sales in key regions, an identity crisis in the industry, and significant foreign exchange headwinds.
In response to the news, Puma shares in Germany experienced their largest drop since 1991. The company’s future looks uncertain as it grapples with changing market dynamics and growing competition.