Birkenstock Benefits From Growing Demand for Clogs and Boots

Birkenstock Holding Plc saw robust holiday demand for its clogs, boots and high-end shearling-lined footwear as the German sandal maker continues a push to become a footwear brand for all seasons.

The closed-toe offerings helped push Birkenstock’s revenue up 18 percent on a constant-currency basis to €402 million ($477 million) in the three months through Dec. 31, the company said Thursday, confirming preliminary figures released last month.

Chief executive officer Oliver Reichert is trying to convince investors that his steady approach to growth will keep Birkenstock hot with consumers for years to come. His strategy relies on Birkenstock manufacturing its own products in Germany and maintaining tight control over where it’s selling its various sandal and closed-toe shoe offerings.

Nonetheless, Birkenstock continues to struggle to win investors to its approach. The stock is down 29 percent in the past year and continues to trade below its 2023 initial public offering price of $46, despite strong growth and profitability.

Investors have soured on the footwear world amid concerns of inflationary pressure as president Donald Trump’s policies increase trade friction and raise anxieties over growth.

The weaker US dollar and new tariffs dragged down Birkenstock’s adjusted gross profit margin to 57.4 percent in the quarter, from 60.3 percent a year earlier.

Demand, however, remained strong across the globe, with constant-currency sales growing 14 percent in the Americas, helped by momentum from youth-focused retailers and sports stores. The figure was 17 percent in the EMEA region and 37 percent in Asia-Pacific, it said.

Birkenstock’s business-to-business division grew 24 percent in constant currency terms, while its direct-to-consumer sales channel rose 12 percent, it said.

The company invested about €38 million in capital expenditures during the recent quarter, with about half of that paying for the acquisition of a new production site in eastern Germany, it said.

Birkenstock hopes to generate €1 billion in incremental revenue over the next three fiscal years based on an average annual growth of as much as 15 percent on a constant-currency basis, it said last month during an investor event.

By Tim Loh

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