Puma expects Q2 sales growth below full-year target

German sportswear maker Puma (PUMG.DE) on Wednesday said it expected second-quarter sales to grow at a low- to mid-single-digit percentage rate, below its full-year target, due to high inventory levels and ongoing challenges in the market.

The company said it expected its profit and margins to be under more pressure in the first half of 2023 than in the second half. It added currency effects, promotional activity and raw material prices would keep weighing on profitability through the year.

Like other consumer brands and retailers, including rivals Adidas (ADSGn.DE) and Nike (NKE.N), Puma has focused on getting rid of excess inventory amid slowing demand, which have put pressure on margins in the sporting goods sector.

Puma’s revenue rose to 2.19 billion euros ($2.41 billion) in the first quarter from 1.91 billion euros in 2022, ahead of the 2.15 billion expected by analysts, according to Refinitiv Eikon data.

The company said strong growth globally, including Greater China, helped it offset a weaker performance in the over-inventoried U.S. market.

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