Quarterly report [Sections 13 or 15(d)]

Segment and Geographic Information

v3.25.1
Segment and Geographic Information
 3 Months Ended
Mar. 31, 2025
Segment Reporting [Abstract]  
Segment and Geographic Information
(9)
Segment and Geographic Information

The Company has two reportable segments, Wholesale and Direct-to-Consumer. Wholesale includes Skechers-branded stores operated by third-party franchisees and licensees, family shoe stores, specialty athletic and sporting goods retailers, department stores and big box club stores, and distributors in select international markets. Direct-to-Consumer includes Company-owned Skechers-branded stores, Company-owned e-commerce sites and leading third-party marketplaces and digital platforms. The Company’s Chief Operating Decision Maker ("CODM") is its Chief Operating Officer, who evaluates segment performance based on sales and gross margin. This information is used by the CODM to analyze the growth of each segment and then makes decisions about how to allocate capital and other resources to each segment. Other costs and expenses of the Company are analyzed on an aggregate basis and not allocated to the segments. The following summarizes the Company’s operations by segment and geographic area:

Segment Information

 

Three Months Ended March 31,

 

(in thousands)

2025

 

 

2024

 

Wholesale sales

$

1,532,208

 

 

$

1,421,698

 

Cost of sales

 

857,038

 

 

 

785,658

 

Gross profit

 

675,170

 

 

 

636,040

 

Gross margin

 

44.1

%

 

 

44.7

%

 

 

 

 

 

 

Direct-to-Consumer sales

$

879,363

 

 

$

829,889

 

Cost of sales

 

300,159

 

 

 

284,295

 

Gross profit

 

579,204

 

 

 

545,594

 

Gross margin

 

65.9

%

 

 

65.7

%

 

 

 

 

 

 

Total sales

$

2,411,571

 

 

$

2,251,587

 

Cost of sales

 

1,157,197

 

 

 

1,069,953

 

Gross profit

 

1,254,374

 

 

 

1,181,634

 

Gross margin

 

52.0

%

 

 

52.5

%

 

(in thousands)

 

As of
March 31, 2025

 

 

As of
December 31, 2024

 

Identifiable assets

 

 

 

 

 

 

Wholesale

 

$

4,107,238

 

 

$

3,915,362

 

Direct-to-Consumer

 

 

4,546,277

 

 

 

4,540,396

 

Total

 

$

8,653,515

 

 

$

8,455,758

 

 

 

Three Months Ended March 31,

 

(in thousands)

2025

 

 

2024

 

Additions to property, plant and equipment

 

 

 

 

 

Wholesale

$

102,534

 

 

$

32,763

 

Direct-to-Consumer

 

44,567

 

 

 

24,324

 

Total

$

147,101

 

 

$

57,087

 

 

 

Geographic Information

 

Three Months Ended March 31,

 

(in thousands)

2025

 

 

2024

 

Geographic sales

 

 

 

 

 

Domestic Wholesale

$

496,167

 

 

$

475,950

 

Domestic Direct-to-Consumer

 

357,536

 

 

 

322,854

 

Total domestic sales

 

853,703

 

 

 

798,804

 

 

 

 

 

 

 

International Wholesale

 

1,036,041

 

 

 

945,748

 

International Direct-to-Consumer

 

521,827

 

 

 

507,035

 

Total international sales

 

1,557,868

 

 

 

1,452,783

 

 

 

 

 

 

 

Total sales

$

2,411,571

 

 

$

2,251,587

 

 

 

Three Months Ended March 31,

 

(in thousands)

2025

 

 

2024

 

Regional Sales

 

 

 

 

 

Americas (AMER)

$

1,104,370

 

 

$

1,019,467

 

Europe, Middle East & Africa (EMEA)

 

718,211

 

 

 

627,652

 

Asia Pacific (APAC)

 

588,990

 

 

 

604,468

 

Total sales

$

2,411,571

 

 

$

2,251,587

 

 

 

 

 

 

 

China sales

$

268,661

 

 

$

319,514

 

 

(in thousands)

 

As of
March 31, 2025

 

 

As of
December 31, 2024

 

Property, plant and equipment, net

 

 

 

 

 

 

Domestic

 

$

1,309,973

 

 

$

1,236,882

 

International

 

 

627,628

 

 

 

598,048

 

Total

 

$

1,937,601

 

 

$

1,834,930

 

 

 

 

 

 

 

 

China property plant and equipment, net

 

$

319,163

 

 

$

303,607

 

 

CONCENTRATIONS OF RISK

The Company’s sales to its five largest customers accounted for approximately 8.6% and 8.5% of total sales for the three months ended March 31, 2025 and 2024.

Assets located outside the U.S. consist primarily of cash, accounts receivable, inventory, property, plant and equipment, and other assets. Assets held outside the U.S. were $5.7 billion and $5.6 billion as of March 31, 2025 and December 31, 2024.

The Company performs regular evaluations concerning the ability of customers to satisfy their obligations and provides for estimated credit losses. Domestic accounts receivable generally do not require collateral. Foreign accounts receivable are generally collateralized by letters of credit. The Company’s additions to the provision for expected credit losses for the three months ended March 31, 2025 and 2024 were $1.7 million and $1.3 million.

The Company’s accounts receivables, excluding allowances for credit losses and chargebacks, by geography are summarized as follows:

 

(in thousands)

 

As of
March 31, 2025

 

 

As of
December 31, 2024

 

Domestic accounts receivable

 

$

420,286

 

 

$

345,488

 

International accounts receivable

 

 

900,335

 

 

 

711,686

 

 

 

The Company’s top five manufacturers produced the following:

 

 

Three Months Ended March 31,

 

(percentage of total production)

2025

 

 

2024

 

Manufacturer #1

 

20.7

 

 

 

20.0

 

Manufacturer #2

 

5.9

 

 

 

8.9

 

Manufacturer #3

 

5.1

 

 

 

5.4

 

Manufacturer #4

 

4.1

 

 

 

5.1

 

Manufacturer #5

 

3.8

 

 

 

3.7

 

Total

 

39.6

 

 

 

43.1