Birkenstock Holding plc Q4 FY2025 earnings call

• Since IPO in 2023, delivered strong double-digit top line growth in constant currency and consistent 30% plus EBITDA margin.
• Unlocked white space potential, deepened retail footprint with 97 stores (doubled since IPO), grew APAC business at 36% average annual rate, and increased B2B share by 10 percentage points to 38%.
• Fiscal 2025 results: Full year revenue EUR 2.1 billion, up 18% in constant currency (ahead of guidance), gross margin 59.1% (up 30 basis points), adjusted EBITDA margin 31.8% (up 100 basis points), sold over 38 million pairs, ASP up 5% in constant currency.
• White space growth: Added 30 new owned retail stores in 2025, ending with 97 stores; plan to open ~40 new stores in 2026. Closed-toe share of revenue increased 500 basis points to 38% in 2025. APAC grew 34% in constant currency, ~double mature markets' pace.

The Americas segment saw an 18% growth in constant currency. The EMEA segment had a 14% growth in constant currency. The APAC segment experienced a 34% growth in constant currency. APAC increased to 11% share of global revenue and has the highest average selling price (ASP).

• For fiscal 2026, target constant currency revenue growth of 13%-15%, resulting in reported revenue growth of 10%-12% to EUR 2.3-2.35 billion.
• Expect adjusted gross margin of 57%-57.5%, inclusive of FX and tariff pressures.
• Target adjusted EBITDA of at least EUR 700 million, implying adjusted EBITDA margin of 30%-30.5% inclusive of external pressures.
• Plan to repurchase $200 million in shares during 2026, capital expenditures EUR 110-130 million, net leverage target 1.3-1.4x by end of 2026, and open ~40 new retail doors.

• Significant FX headwinds in 2026, especially in first half, impacting revenue growth and margins.
• Tariff impacts in 2026 expected to be more significant than 2025, leading to margin pressure.
• Production capacity constraints limiting growth, especially with increased demand for premium executions and wholesale growth.

Q: Matthew Boss asks about the more conservative growth outlook for 2026 and demand slowdown.

A: Oliver Reichert states strong demand, but capacity constraints from production minutes (clogs taking more minutes than sandals) limit growth.

Q: Laurent Vasilescu asks about margin outlook, FX flow-through, and tariffs.

A: Ivica Krolo explains FX and tariff impacts on margins, flow-through of FX to P&L, and efforts to mitigate tariff impacts through pricing and efficiencies.

Q: Randal Konik asks about channel mix growth.

A: Ivica Krolo says B2B will continue to outpace D2C due to in-person shopping trends, and D2C is being accelerated via store rollout and loyalty programs.

Q: Lorraine Hutchinson asks about EMEA consumer demand.

A: Nico Bouyakhf mentions strong growth in EMEA, driven by product newness and higher price points, with closed-toe categories performing well.

Q: Michael Binetti asks about EBITDA margin guidance.

A: Ivica Krolo breaks down components of margin guidance, including capacity absorption, channel shift, and pricing.

Q: Dana Telsey asks about DTC channel performance and store locations.

A: Nico Bouyakhf discusses DTC performance with retail outpacing digital, plans for new stores, and Ivica Krolo talks about surgical pricing.

Q: Adrien Duverger asks about new products and closed-toe share.

A: Nico Bouyakhf says closed-toe is growing strongly and will continue to outpace open-toe, with diversification in products.

Q: Mark Altschwager asks about sustaining mid-teens growth.

A: Oliver Reichert talks about capacity expansion in Portugal and Dresden, and optimization of existing facilities.

Q: Samuel Poser asks about Q1 2026 details.

A: Oliver Reichert says Q1 is performing well, and Ivica Krolo mentions no pre-announcement on margins yet.

Q: Paul Lejuez asks about regional plans and distribution restrictions.

A: Oliver Reichert talks about shifting product to APAC due to high ASP, and engineered distribution to manage capacity.

Q: Janine Hoffman Stichter asks about B2B expansion.

A: Nico Bouyakhf says B2B growth is from existing doors with disciplined distribution, and plans to unlock new areas carefully.