This article first appeared on GuruFocus .
Release Date: April 29, 2026
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
Positive Points
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Bjorn Borg AB ( STU:6BB ) reported a record quarter with sales exceeding 300 million, marking a 7% increase, and over 10% growth when adjusted for currency.
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The company achieved a 37% increase in operating profit compared to the previous year, reaching 47 million.
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The sports apparel category continues to show strong performance with double-digit growth for the 15th consecutive quarter.
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The company's gross margin improved by four points to 54%, attributed to strong performance in high-margin categories like underwear.
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Bjorn Borg AB ( STU:6BB ) has successfully expanded its brand presence in Germany, with brand strength increasing by 500% in the market.
Negative Points
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Footwear sales declined by 20% during the quarter, indicating challenges in this product category.
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The Benelux markets experienced a decline, primarily due to underperformance in the footwear category.
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Own retail sales declined significantly by 29%, with comparable store sales also down by 8%.
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The company's e-commerce growth slowed to single digits, which is below their expectations.
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Consumer confidence is decreasing in key markets like Sweden and Germany, posing potential challenges for future growth.
Q & A Highlights
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Q: Could you break down the growth in sports apparel in terms of markets? Are you gaining market share, and what are the underlying drivers of this growth in Q1? A: We are indeed gaining market share, having done so for 14 to 16 quarters. The growth is driven by both performance products and sports apparel for casual use. The intersection between these two is blurry, with consumers using them interchangeably. Women's sports apparel is showing strong growth, which is crucial for future expansion, as it now rivals men's in certain months on our e-commerce platform.
Q: Despite a challenging environment, wholesale is showing impressive growth. Is this due to optimistic wholesale customers or successful new product segment launches? A: The growth is due to multiple factors. While consumer sentiment is hesitant, our strength lies in successfully operating across various channels. We adapt to where consumers are, whether in e-commerce or wholesale. Our stable categories like underwear help us navigate economic challenges, while our small market share in sports apparel and footwear allows us to grow even in a declining market.
Q: What are the challenges and focus areas for shoes and bags in 2026? Are you satisfied with the product offering, or is it about addressing customers? A: We took over footwear two years ago, and integrating it has been challenging. It takes time to build a strong collection, with wholesale lead times of 20-21 months. While Sweden and our e-commerce show growth in footwear, markets like Holland and Belgium are declining. We are rebuilding confidence in these markets with a new team, but it will take time.
Q: Could you elaborate on the factors impacting the strong gross margin in Q1, such as pricing, product mix, or currency? A: The gross margin is influenced by several factors. Strong performance in high-margin categories like underwear and e-commerce contributes positively. Currency fluctuations, particularly the strengthening of the Swedish Kronor against the US dollar, have also impacted margins. Additionally, our ability to adjust prices and negotiate product costs plays a role.
Q: Online growth has returned to single digits. Do you expect to return to double-digit growth, and what challenges do you see in this channel? A: While I avoid specific forecasts, our ambition is to grow more than 2%. We've reduced discounts to focus on full-price sales, impacting growth as consumers become more price-focused. Despite this, our gross margin is better, and marketing investments are higher. The e-commerce landscape is changing with AI advancements, and we have a strong, AI-savvy team to navigate these changes and drive future growth.
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
