Birkenstock shares soared 17% to $46.30 after the company reported better-than-expected fiscal third-quarter results, reaching a three-week high on the NYSE. The German footwear manufacturer reported third-quarter revenue of €720 million, representing a 13% increase from €635.0 million in the same year-ago period. The company's adjusted earnings per share came in at ₹0.60 euro, though this was slightly below estimates of ₹0.76 euro (0.78 euro). Despite a 15.2% decline in net profit to €109.6 million from €129.2 million in the prior year, adjusted figures showed significant improvement with adjusted net profit rising 19% year-on-year and adjusted EPS increasing 19% to ₹0.74 year-on-year. The adjusted EBITDA margin stood at 33.7%, better than the consensus estimate of 33.1%, demonstrating operational efficiency despite margin pressures from foreign exchange and tariff impacts. According to MarketBeat, the depreciation in the US dollar, Canadian dollar, and Asian currencies like the Indian rupee and the Japanese yen compared to the third quarter of 2025 cost a 180 basis points headwind to revenue growth in the quarter, with the average euro to US dollar rate at 116, up from 113 in Q3 of fiscal 2025.
Based on the strong quarterly performance, Birkenstock has raised its annual sales growth forecast to 15% on a constant currency basis, up from its earlier projection of 13% to 15% growth. As reported by Investing.com, this implies a revenue of as much as €2.35 billion for the fiscal year ending September. The company maintained its annual profit forecast of ₹16.50 to ₹19.10 euros per share at ₹1.90 to ₹2.05 euros per share and also sees adjusted earnings before interest, taxes, depreciation, and amortisation of at least €710 million. This upward revision reflects the company's confidence in sustained demand for its premium footwear products, with management noting that foreign exchange pressure and a higher tax rate related to refinancing activities were partially offsetting operational improvements. The company also lifted its adjusted EBITDA guidance to at least €710 million from the previous target. CEO Oliver Reichert stated that the company was raising its outlook for fiscal 2026 due to the third-quarter performance, citing continued execution across the business and accelerated direct-to-consumer growth.
The company's direct-to-consumer (DTC) business emerged as a key growth driver, with DTC revenue growth accelerating to 16% in constant currency, marking the fastest pace in two years and outpacing wholesale for the first time in that period. According to Investing.com, this expansion in the DTC channel demonstrates Birkenstock's successful digital transformation strategy and strengthened brand loyalty among affluent consumers. The company now operates 124 stores after adding 13 new locations in the quarter, with DTC revenue totaling €278 million, representing 39% of total sales—a 20-basis-point increase in DTC penetration from the prior year. The acceleration in DTC growth to 16% in constant currency marked a notable improvement from the 12% pace in the prior quarter. Management noted that the improvement was driven by both owned retail expansion and stronger digital performance from refined content, improved user experience, and enhanced checkout options. The company is benefiting from growing appetite for its closed-toe sneakers, boots, clogs, and slippers, which often command higher prices than the classic sandals. CEO Reichert highlighted that the firm's closed-toe share of the business continues to expand, led by newness in both clogs and shoes, with the company noting very strong full-price sell-through even in the second quarter. According to MarketBeat, non-Boston closed-toe executions up more than 50% and Naples units increasing more than fourfold, while sandals still growing at a mid- to high-single-digit rate.
Revenue growth remained in double digits across all regions, with Asia-Pacific sales increasing 18% on a reported basis, Americas growing 11%, and EMEA rising 15% on a constant-currency basis. As reported by Investing.com, the Americas region generated €347 million in revenue, up 11% on a reported basis and 14% in constant currency, while EMEA revenue reached €297 million, growing 15% both reported and in constant currency. The Asia-Pacific region showed the strongest growth at 18% reported and 23% in constant currency, reaching €75 million—though it remains the smallest of the three regions. This broad-based regional growth demonstrates the strength of Birkenstock's global footprint and the resilience of demand for its premium sandals and closed-toe shoes, with the company noting that China remains a major growth market with sales up 50% in the quarter. Chief Executive Oliver Reichert said the company "performed exceptionally well in Q3" and that the results showed "the strength of our brand."
Adjusted EBITDA increased 11% to €242 million, though the adjusted EBITDA margin stood at 33.7%, down 70 basis points from 34.4% in the year-ago period. According to Investing.com, the margin decline was primarily due to unfavorable currency translation, which impacted margins by 60 basis points, and incremental US tariffs, which had a 70-basis-point impact. These factors were partly offset by improved capacity absorption. The company completed a €230 million accelerated share repurchase programme on June 30, 2026, reducing its outstanding share count by approximately 6 million shares. Net leverage increased to 1.8 times last-twelve-months adjusted EBITDA from 1.5 times at the end of September 2025, driven primarily by cash outflows related to the accelerated share repurchase program. With €694 million in cash and cash equivalents and an additional €500 million in available liquidity, Birkenstock maintains financial flexibility for future buybacks or refinancing activities. The adjusted gross margin contracted 130 basis points to 59.2% from 60.5% in the prior-year period, with management noting that foreign exchange pressure and a higher tax rate related to refinancing activities were partially offsetting operational improvements. The company invested €26 million in capital expenditures during the third quarter to add production capacity and expand retail operations globally.
