The decline in gross margin primarily reflects a higher mix of digital and international distributor sales, as well as increased duties in the US business, which offset higher average selling price.
Allbirds reported Q3 FY25 net revenue of $33 million, down 23.3 per cent y-o-y, with gross profit of $14.2 million and a 43.2 per cent margin, down 120 bps.
Declines were driven by international distributor transitions, retail closures, and higher duties.
SG&A fell to $21.7 million.
The company focuses on cost reduction, liquidity, and growth initiatives.
In the third quarter of 2025, net revenue decreased 23.3 per cent to $33 million compared to $43 million in the third quarter of 2024. The year-over-year decrease is primarily attributable to structural changes, including impacts from international distributor transitions and planned retail store closures, the company said in a press release.
Selling, general, and administrative expense (SG&A) was $21.7 million, or 65.7 per cent of net revenue, compared to $31 million, or 72 per cent of net revenue in the third quarter of 2024. The decrease is primarily attributable to lower personnel expenses, occupancy costs, stock-based compensation expenses, and depreciation and amortisation expenses.
“We’re pleased to deliver third quarter results in line with our expectations, highlighted by a robust flow of new product introductions – many of which met with strong customer response,” said Joe Vernachio, CEO. “Entering the final months of the year, we will continue to support our product engine with compelling marketing content to capture consumer mindshare and reignite growth. Throughout the holiday season, we will be spotlighting gifting ideas and emphasising Allbirds’ core principles of comfort, style and sustainability.”
Net revenue in the first nine months of 2025 decreased 21.7 per cent to $104.8 million compared to $133.9 million in the first nine months of 2024. The year-over-year (y-o-y) decrease is primarily attributable to structural changes, including impacts from planned retail store closures and international distributor transitions.
Gross profit in the first nine months of 2025 totalled $44.8 million compared to $63.6 million in the first nine months of 2025, while gross margin declined to 42.7 per cent in the first nine months of 2025 versus 47.5 per cent in the same period a year ago. The decline in gross margin is primarily due to channel mix, with a lower percentage of sales coming from the retail business and a higher percentage coming from its digital and distributor channels, as well as increased promotional activity and higher inventory adjustments.
“Our teams are focused on accelerating progress under our turnaround in the quarters ahead,” added Vernachio. “At the same time, we are taking definitive steps to further reduce costs, enhance liquidity, and pursue value-creating opportunities.”
Fibre2Fashion News Desk (RR)
