Equities

Canada Goose Q4 Revenue Up 22%, Shares Jump on China Sales

Canada Goose's Q4 revenue hits C$358M, up 22%, driven by strong China and US sales, shares jump 12%.

By Bill Bullington

5/16, 08:30 EDT
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Key Takeaway

  • Canada Goose's Q4 revenue hit C$358 million, a 22% increase, beating estimates due to strong sales in China and the US.
  • Shares surged over 12% following the earnings beat, highlighting investor confidence.
  • The company forecasts low single-digit sales growth for fiscal 2025 but expects mid-teen percentage growth in adjusted profit per share.

Strong Fiscal Fourth Quarter

Canada Goose Holdings Inc., renowned for its high-end outerwear, reported a significant surge in sales, exceeding analysts' expectations. The company's fiscal fourth-quarter revenue reached C$358 million ($263 million), surpassing the average analyst estimate of C$316 million. This represents a 22% increase in sales from the previous year, driven by robust retail results in China and the US. Following the announcement, Canada Goose shares experienced a notable rise, climbing more than 12% in early trading in New York.

Expansion and Consumer Focus

The Toronto-based luxury coat maker has been strategically enhancing its performance in Asia, a crucial market where over 40% of its stores are located. Despite the slow recovery from the Covid pandemic in this region, Canada Goose has continued to expand its retail footprint, adding three new permanent stores in the fourth quarter. This expansion aligns with the company's ongoing shift from wholesale to direct-to-consumer sales, aiming to engage more directly with its customer base.

Future Outlook

Looking ahead, Canada Goose has set a cautious yet optimistic outlook for fiscal 2025. The company anticipates sales growth in the low single digits compared to 2024, reflecting its strategic pivot away from wholesale operations. Despite the expected slow growth in revenue, Canada Goose plans to increase its product prices, which is projected to expand margins. Consequently, the company forecasts that adjusted profit per share will experience a mid-teen percentage growth year over year. This outlook is based on the assumption that global consumer spending will remain under pressure due to high interest rates and geopolitical uncertainties. However, Canada Goose remains committed to operational discipline and the execution of initiatives aimed at delivering further cost efficiencies.

Management Quotes

  • Canada Goose Holdings Inc.:

    "The outlook assumes global consumer spending will continue to be pressured amid persistently high interest rates and geopolitical uncertainty... Within our business, we assume continued operational discipline and execution of initiatives focused on delivering further cost efficiencies."