Dr Martens shares take a kicking after demand falls
Shares in Dr Martens slumped 13 per cent on Tuesday morning after the firm reported a drop in sales over the golden quarter, amid investor concern at its ongoing strategic “pivot”.
Revenue at the bootmaker fell 2.7 per cent to £253m in the three months to the end of December, largely due to weakness in its direct to consumer (DTC) arm.
DTC revenue was down 6.5 per cent compared to last year, as a weak performance in EMEA and APAC more than offset higher revenue in the Americas. The firm said it had adopted a “disciplined approach to promotions” in Europe, particularly in Germany and the UK.
Revenue in Doc Martens wholesale business, however, increased 9.5 per cent, with growth across all regions.
The firm expects revenue to be broadly flat across the 2026 financial year as the firm attempts to shift its focus to more sustainable sources of revenue.
Ije Nwokorie, chief executive said: “This is a year of pivot, as we make the necessary changes to our business to set us up for future sustainable growth. I remain laser focused on executing our new strategy and we will deliver all four of our strategic objectives.”
These boots are made for walking
Since its IPO back in 2021, Doc Martens has lost around 85 per cent of its value amid a slew of profit warnings and investor unease about the firm’s management.
The bootmaker unveiled a turnaround plan last summer, involving reducing its reliance on discounting across the business, targeting new markets, and promoting new products, such as bags and sandals.
While analysts have been broadly supportive of the firm’s long-term strategy, many remain worried about execution risks.
“Protecting the integrity of the brand rather than flogging its footwear on the cheap is a sensible long-term approach,” Dan Coatsworth, head of markets at AJ Bell said.
“However, Dr Martens has little credit in the bank with investors who, even in the context of the company’s strategy of putting price above volume, may be alarmed by the scale of the drop in European sales. The consumer backdrop may be tough but that alone is not enough to earn Dr Martens a free pass.”
Similarly, Adam Vettese, market analyst for eToro, said that weak demand in Europe and the firm’s reliance on new categories mean “execution risks loom large.”
Its shares were trading around 66p, down from a recent peak of 99p per share in late September.