Birkenstock Holding PLC (NYSE:BIRK) reported third-quarter earnings on Thursday that topped analyst expectations, as mid-single-digit price increases and strong wholesale demand helped the German footwear maker offset tariff and supply chain pressures.
The company posted earnings per share of €0.69, €0.08 above forecasts, on revenue of €635 million, roughly in line with estimates.
Constant-currency sales rose 16% in the Americas and 13% in Europe, the Middle East and Africa (EMEA), while Asia-Pacific grew 24%, slightly below analyst expectations.
Birkenstock’s business-to-business (B2B) sales jumped 18%, surpassing forecasts, though growth in its direct-to-consumer (DTC) channel was slower. The company maintained its full-year outlook.
Shares of Birkenstock were down around 3.6% in early trading.
Jefferies analysts highlighted the company’s enduring brand strength and pricing power. “A tariff-driven price hike in July met no pushback or cancellations as wholesale partners kept their books full, underscoring the brand’s pricing power and ability to lift margins without hurting demand,” they wrote.
The quarter marked the company’s highest-ever EBITDA margin for Q3 at 34.4%, up 140 basis points from a year ago. Gross margin rose to 60.5%, surpassing Street estimates of 60.0%, benefiting from recent price increases and improved absorption of costs from a new manufacturing facility.
Operating cash flow for the quarter was €261 million, with net leverage down to 1.7x, leaving the company with a solid balance sheet.
Looking ahead, Birkenstock faces a baseline 15% tariff on EU imports, effectively 21% up from 11% in 2025. Management said the impact is fully accounted for in its guidance and expects to offset the costs through price increases, efficiencies from vertical integration, better vendor terms, optimized product mix, and regional allocation.
Jefferies said the stock, trading at roughly 12 times FY2026 estimated EBITDA, offers an attractive risk/reward profile given its “strong, durable growth and leading EBITDA margin.”