Columbia Sportswear Q2 2025 Earnings: Tariff Impact Expected at $35M-$40M, Strong Growth in International Markets

Columbia Sportswear expects a $35-40M impact from tariffs in 2025, but strong demand in international markets drives growth, with double-digit growth in EMEA and LAAP regions, particularly in China, Japan, Europe direct, and international distributor markets.

Columbia Sportswear Company (COLM) reported its Q2 2025 earnings, highlighting a challenging U.S. market environment due to tariffs and policy uncertainty. The company expects a financial impact of $35 million to $40 million from tariffs in 2025, with ongoing efforts to mitigate these costs [1].

Despite these headwinds, Columbia Sportswear saw robust growth in international markets, particularly in the EMEA and LAAP regions. The company reported double-digit growth in these areas, led by strong performances in China, Japan, Europe direct, and international distributor markets [1].

The company's chairman, CEO, and president, Timothy P. Boyle, attributed the international success to a new global marketing platform under the ACCELERATE growth strategy. This platform aims to reenergize the Columbia brand, particularly in the U.S., by leveraging its signature air reference and humor in global advertising [1].

To address the U.S. market challenges, Columbia Sportswear is implementing several strategic changes. These include a new site redesign, product innovation such as the New Amaze Puff Insulated Jacket, and enhanced in-store experiences. Additionally, the company realigned its North America regional organization to combine its wholesale and direct-to-consumer businesses [1].

The company's financial results for Q2 2025 showed net sales rising 6% year-over-year to $605 million, driven by earlier fall wholesale shipments. However, U.S. net sales decreased by 2%, with U.S. DTC net sales declining and e-commerce down by low double-digit percent [1].

Looking ahead, Columbia Sportswear expects net sales for the full year 2025 to be $3.3 billion to $3.4 billion, representing a 1% to 1% year-over-year change. This outlook is below initial guidance from February, reflecting lower assumptions for U.S. wholesale and DTC businesses, partially offset by higher forecasts in most international markets [1].

Management anticipates tariffs to have an impact of approximately $15 million to $20 million on gross margin contraction in Q3. They are also considering price increases and vendor negotiations in Asia to mitigate the tariff impact [1].

Overall, Columbia Sportswear is navigating a complex market environment, with strong international growth offsetting U.S. challenges. The company remains focused on strategic investments and cost savings to maintain its financial health and long-term growth prospects.

References:
[1] https://seekingalpha.com/news/4476245-columbia-sportswear-signals-35m-40m-tariff-impact-in-2025-as-u-s-market-softens-international