29 Apr 2025
Xtep announced its 1Q25 operational results, with retail sales for its Xtep Core Brand recorded a MSD growth YoY, slowing down from HSD/HSD growth in 4Q24/1Q24. While offline sales recorded LSD YoY growth amid less foot traffic, online sales grew by >20% YoY during the period. Kids’ wear sales was better than that of adults’. Sales of shoes were still the main growth driver, with functional shoes grew by double digit YoY. Retail inventory turnover was at a healthy level of 4 months (flat QoQ and improved YoY) while retail discount level was at 25%-30% (4Q24: 25%-30%). The management maintains the March guidance for FY25, aiming for profit growth of over 10% this year. Starting in 2H25, the company will begin promoting the DTC transformation of its main brand, with 400–500 stores expected to complete the transformation between the 2H25 and FY26.