Amer Sports, Inc. Q1 FY2025 earnings call

James Zheng noted Amer Sports had strong first-quarter performance with 23% sales growth (26% ex currency) and expanded adjusted operating margin. Key brands like Arc'teryx, Salomon, and Wilson showed momentum. Arc'teryx had strong growth across regions, channels, and categories, with direct-to-consumer growth driven by stores and online. Salomon sneakers saw accelerating global momentum. Wilson had solid results in various categories. Andrew Page discussed financial results, noting adjusted gross margin increased 330 basis points, adjusted operating margin expanded 490 basis points. He also talked about tariffs, mitigation strategies, and updated guidance for the full year and second quarter, highlighting low U.S. revenue exposure and financial flexibility.

Technical Apparel: Revenues increased 28% to $664 million, led by Arc'teryx. DTC expansion was 31% with a 19% omni-comp in quarter one, and adjusted operating margin expanded 110 basis points to 23.8%. Outdoor Performance: Revenues increased 25% to $502 million, driven by Salomon soft goods and good results in Winter Sports Equipment. DTC channel grew 68%, and adjusted operating profit margin expanded 990 basis points to 14.7%. Ball & Racquet: Revenue increased 12% to $306 million, driven by soft goods, racquet sports, and golf. Adjusted operating profit margin increased 270 basis points to 6.6%.

Full-year 2025 reported group revenue growth raised from 13%-15% to 15%-17%. Adjusted gross margin expected 56.5%-57%, adjusted operating margin 11.5%-12%. Adjusted diluted EPS expected $0.67-$0.72. Second quarter group revenue growth expected 16%-18%, adjusted gross margin 57%-58%, adjusted operating profit 3%-4%, adjusted diluted EPS $0.00-$0.02.

Tariff-related risks, including U.S. sourcing exposure where 26% of group revenues were from the U.S. in 2024, with sourcing from China, Vietnam, etc. Ball & Racquet has slightly more than half of tariff exposure, Technical Apparel around 30%, and the remainder in Outdoor Performance. Measures to mitigate include pricing, vendor renegotiations, and supply chain maneuvers.

Q: Matthew Boss asked about broad-based strength and competitive advantages, and momentum at Salomon.

A: James Zheng said Amer Sports has a unique portfolio, and Salomon sneakers have a unique position with technical and design attributes. Stuart Haselden added Arc'teryx had a solid 19% omni-comp with traffic-driven comp and strong store performance.

Q: Brooke Roach inquired about Salomon's growth sustainability and margin profile.

A: Andrew Page said Salomon has strong product, DTC growth, and margin inflection with potential for continued growth.

Q: Laurent Vasilescu asked about Salomon's growth and tariff impact.

A: Andrew Page stated Salomon has large market potential, and tariff impact is negligible with mitigation measures.

Q: Chad Britnell asked about Ball & Racquet store growth and profitability.

A: Andrew Page said store growth in Ball & Racquet is primarily in Asia and Greater China, and profitability will return with scaling investment in Tennis 360.

Q: Michael Binetti asked about Arc'teryx omni-comp and store strategy.

A: Stuart Haselden discussed Arc'teryx's product launches and store strategy focusing on larger formats for ROI.

Q: Jonathan Komp asked about Salomon wholesale visibility.

A: James Zheng and Andrew Page said Salomon wholesale in Europe is showing positive trends with strong sell-through and reorders.

Q: Jay Sole asked about Arc'teryx women's business.

A: Stuart Haselden said women's business is growing with potential for 50-50 split, driven by product and community engagement.

Q: Paul Lejuez asked about Salomon AUR and tariff impact.

A: Andrew Page said Salomon sports style and performance are strong, and no air pockets from tariffs were seen.