Puma shares dive after warning of full-year loss

Puma shares dropped 16% on Friday after the German sportswear brand said it now expects an annual loss as sales decline and U.S. tariffs dent profit.

Puma has been struggling to attract shoppers as re-released retro sneakers, such as the Speedcat, have not sold as well as hoped, and CEO Arthur Hoeld, in the role since July 1, said the company needs to “course-correct”.

“This year, 2025, will be a reset for Puma and 2026 will be a transition year for us,” said Hoeld, formerly sales chief at Adidas, who was appointed by Puma’s board in April to turn performance around.

“We as a company need to take a hard look at ourselves,” he said on a conference call with journalists. “We do have tremendous potential with a brand that hasn’t been unlocked yet, but a brand that also requires a reset and a new way forward.”

Hoeld said he planned to review Puma’s growth plan and strengthen the quality of wholesale distribution, and that he would give a broader roadmap on his strategy for Puma by the end of October.

“Puma is facing an existential identity crisis in terms of relevance in a sporting goods industry that is more competitive, and at a time when the largest player Nike is staging its comeback from Autumn/Winter ’25,” said RBC analyst Piral Dadhania.

TARIFF HIT

U.S. tariffs will reduce Puma’s gross profit this year by about 80 million euros ($94 million) despite efforts to offset the pain, including U.S. price hikes in the fourth quarter, Chief Financial Officer Markus Neubrand said. He declined to say how much prices would go up.

Sportswear retailers like Nike, Adidas and Puma rely on Southeast Asian countries like Vietnam for the sneakers and clothes they import into the United States, making them especially exposed to tariffs.

Puma frontloaded shipments of goods from Asia ahead of successive U.S. tariff deadlines, Neubrand said, driving inventory levels up and contributing to more discounting.

Most Puma products sold in the United States are made in Vietnam, Cambodia, and Indonesia, Neubrand said, and the company aims to cut its sourcing from China to the U.S. further from 10% currently.

In preliminary earnings released late on Thursday, Puma said annual sales would decline by at least 10%, having previously forecast low to mid-single-digit growth.

Puma’s second-quarter currency-adjusted sales of 1.94 billion euros were weaker than analysts expected, with North America sales dropping 9.1% and Europe down 3.9%.

The company did not say how big the annual loss was likely to be. It previously forecast earnings before interest and tax of between 445 million euros and 525 million euros for the year.