Puma (ETR:PUM) outlined a sweeping reset effort alongside sharply weaker fourth-quarter and full-year 2025 results, as management said it deliberately pulled back from “undesirable” wholesale business, took inventory back from partners, and reduced promotions in an effort to improve brand perception and set the stage for a return to growth in 2027.
2025 “reset” and operational changes
CEO Arthur Hoeld described 2025 as the first phase of a three-year transformation journey that began mid-year, centered on cleaning up distribution, improving cash discipline, and reducing complexity. Measures included reducing exposure to mass merchants, lowering discounting in Puma’s own channels, and cutting purchase order placements to avoid oversupply into 2026.
Leadership and operating model adjustments were also highlighted, including Andreas Hubert joining as chief operating officer and expanded responsibilities for Maria Valdes to combine product, go-to-market and brand marketing under one structure. Puma also identified four “DNA categories” it intends to prioritize: football, running, training (now separated from running), and Sportstyle (Select and Prime). A new go-to-market calendar is expected to be fully implemented for the spring/summer 2028 season. In Europe, Hoeld said the company plans to streamline to three clusters—central, north, and south—to improve consistency and efficiency.
Q4 and full-year 2025 results reflect deliberate distribution cleanup
CFO Markus Neubrand said currency-adjusted sales fell nearly 21% in Q4, driving a roughly 8% decline for full-year 2025. He attributed the decline primarily to reset actions in the second half of 2025, with the biggest impact coming from canceling undesirable wholesale business in the mass-merchant channel, followed by inventory takebacks and lower DTC promotions.
By channel, wholesale sales fell about 28% in Q4 due to takebacks and immediate actions to reduce mass-merchant exposure in North America and phase out undesirable business across regions. Wholesale was down 13% for the full year. Direct-to-consumer (DTC) sales declined 8% in Q4, with owned-and-operated stores down about 1% and e-commerce down 20% as promotions were reduced. For full-year 2025, DTC grew 3%.
The DTC mix increased notably, with DTC representing 41.1% of Q4 sales versus 35.5% a year earlier; the full-year DTC share rose to 32.4%.
Regionally, Neubrand said the reset was pronounced in the Americas, EMEA, and China. EMEA sales dropped around 24% in Q4 and 7% for the year. The Americas fell 22% in Q4 and 10% for the year, with North America down more than 33% in Q4 and 19% for the full year due to the U.S. mass-merchant distribution cleanup. Asia Pacific declined nearly 13% in Q4 and 7% for the year, driven mainly by weaker Greater China wholesale, partially offset by DTC growth; Greater China sales fell almost 20% in Q4.
Margin pressure, losses, and balance sheet moves
Neubrand said gross margin fell sharply in Q4, down 7.5 percentage points, driven mainly by increased promotions in wholesale and inventory reserves linked to the distribution cleanup. For the full year, gross margin declined 260 basis points to 45%, pressured by promotions, inventory reserves, and adverse currency effects (including the Turkish lira and several Latin American currencies). The CFO said lower sourcing costs, including duties, helped offset impacts, and Puma limited the adverse effect of U.S. tariffs to about EUR 30 million in 2025.
Adjusted EBIT in Q4 was -EUR 229 million, compared with a year-earlier decline of EUR 315 million, while reported EBIT (including one-time effects) was around -EUR 308 million. Loss from continuing operations in Q4 was -EUR 335 million.
For full-year 2025, adjusted EBIT fell to -EUR 166 million, with one-time effects of about EUR 192 million. Reported EBIT was -EUR 357 million and loss from continuing operations was around -EUR 644 million. Neubrand said one-time effects were primarily tied to the cost efficiency program and goodwill impairments, including EUR 102 million in personnel expenses, EUR 63 million in impairments (Japan, Canada, and digital infrastructure), and EUR 27 million related to store closures and other non-operating costs.
Given the net loss and an effort to preserve liquidity, Neubrand said the management board and supervisory board will propose no dividend for 2025 at the 2026 annual general meeting.
Working capital increased materially, with inventories up 2% reported (11% currency-adjusted) to around EUR 2.1 billion, partly due to inventory takebacks. Trade receivables fell about 27% to just over EUR 900 million. Working capital rose to more than EUR 1.5 billion, accounting for 21% of group sales versus about 15% in 2024. Neubrand said inventory cleanup is “slightly ahead of plan,” with most targeted takebacks completed and inventories beginning to decline from Q3 to Q4.
Puma reported negative operating cash flow of around EUR 320 million, driven by losses and higher working capital. Capex totaled EUR 206 million, focused on digital infrastructure and DTC investments, leading to free cash flow of -EUR 530 million. Financing cash flow was about EUR 400 million and included around EUR 1 billion in additional financial liabilities, leaving cash at EUR 290 million at year-end and net debt just over EUR 1 billion. Neubrand said Puma had about EUR 1.5 billion of financial headroom at the end of 2025, including unutilized credit lines of around EUR 1.2 billion. He added that in February 2026 Puma secured a EUR 100 million private placement and reduced a bridge facility.
2026 outlook: transition year, improving margin but sales decline expected
Management characterized 2026 as a transition year in which the reset actions continue, including inventory liquidation and distribution cleanup. Hoeld said the new brand operating model’s full effects are expected in 2027, and that marketing working budgets will be reshaped toward more effective consumer engagement.
For 2026, Puma expects constant-currency sales to decline in the low- to mid-single-digit percentage range, with FX headwinds of about three percentage points. Hoeld said reduced sales in North America will be the primary driver due to ongoing distribution streamlining, while growth is expected in Latin America, the Middle East, Africa, and India. The company also said ANTA’s acquisition of a 29% stake could negatively affect Greater China business in 2026, largely because wholesale partners may hesitate to extend commitments amid expectations that Puma’s China model could shift more toward DTC; management said it believes the partnership offers meaningful medium- to long-term benefits.
The company expects wholesale sales to decline and DTC to grow on a currency-adjusted basis, with the second half of 2026 stronger than the first half. Hoeld said first-quarter sales should align with the full-year outlook.
Reported EBIT for 2026 is forecast in a range of -EUR 50 million to -EUR 150 million, including one-time effects expected to be “significantly lower” than 2025. Neubrand said Puma anticipates a “substantial improvement” in gross margin, primarily due to lower promotions and lower inventory reserves, with additional help from channel mix; he added that a weaker U.S. dollar is a slight tailwind in the second half of 2026 due to hedging.
Capex is expected to be around EUR 200 million, again focused on digital infrastructure and investments in Puma’s own channels. Management also said free cash flow is expected to be positive in 2026.
Brand momentum and strategic priorities
In Q&A, Hoeld said Puma is taking steps to build brand “heat” in 2026 ahead of larger product and go-to-market benefits expected in 2027. He cited platforms including the World Cup, the HYROX partnership, a more focused communication strategy around the NITRO running platform, and continued emphasis on Speedcat and Suede in sportstyle. He also said marketing will shift away from conventional above-the-line media toward more grassroots engagement.
On category differentiation, Hoeld pointed to performance running with NITRO, training with HYROX, and continued positioning in Formula 1, including the addition of McLaren beginning in 2026.
Hoeld also discussed a longer-term channel mix target, saying an industry-like balance of roughly 60% wholesale and 40% DTC is where Puma expects to land, while emphasizing growth opportunities in e-commerce and ongoing investment in digital capabilities. He said the company was making progress on hiring a global VP of e-commerce and expected to provide an update in the coming weeks.
Management reiterated its longer-term ambition to be a top three sports brand and said it aims to return to above-industry growth and “healthy profits” starting in 2027, though it declined to provide specific profitability targets.
About Puma (ETR:PUM)
PUMA SE, together with its subsidiaries, engages in the development and sale of athletic footwear, apparel, and accessories in Europe, the Middle East, Africa, the Americas, and the Asia Pacific. The company provides sports lifestyle products for football, handball, rugby, cricket, volleyball, track and field, motorsports, golf, and basketball. It issues licenses to independent partners to design, develop, manufacture, and sell watches, glasses, safety shoes, workwear, and gaming accessories. The company sells its products under the PUMA and Cobra Golf brands through retail stores, factory outlets, and online stores.
