Puma Stock: Shares Plunge 19% on Profit Warning

Puma experienced a devastating day on the stock market Thursday as shares plummeted nearly 19% to €34.02, marking their lowest level since March 2018. The dramatic decline followed the sportswear manufacturer's disappointing fourth-quarter results for 2023, which fell significantly short of market expectations. While currency-adjusted revenue showed a modest increase of 4.4% to €8.82 billion, earnings per share dropped substantially to €0.16 from €0.88 in the previous year's period. The company's net profit declined from €305 million to €282 million, while operating profit stagnated at €622 million, landing at the lower end of its guidance range.

Efficiency Program Unveiled

In response to the underwhelming performance, Puma has announced its "nextlevel" efficiency program aimed at boosting profitability. The company has pushed back its original target of achieving an 8-8.5% operating margin from 2025 to 2027, now aiming for 8.5%. This delay in achieving margin goals has sparked concern among analysts, with expectations for 2025 net profit likely to be revised downward by approximately 11% from current consensus forecasts. The company's long-term ambition remains set at a 10% operating margin, though market confidence in these targets has been shaken by recent developments.