2026.10.09 | GP | Consumer | EU Athletic Footwear Channel Check

Primary:

ADS:GR

AS

PUM:GR

Associated:

ONON

DECK

7936:JP

New Balance, Inc.

SKX

NKE

Viewpoint:

C-Suite

Moderator: Mayank Upadhyay (MU)

Marcello Pace (MP), CEO - PittaRosso

SUMMARY

Overview

The expert leads a major Italian footwear retailer operating roughly 300 large-format stores. The discussion covered weak 3Q26 athletic-footwear demand, heavier discounting, changing consumer preferences, brand performance, inventory health and future orders.

Demand was hurt by economic uncertainty, energy costs and unusually warm weather. Athletic lifestyle footwear weakened as dress footwear showed early signs of recovery. Running remained the strongest athletic category.

Key Insights

The expert characterized 3Q26 as exceptionally poor, erasing most earlier gains despite modest unit growth. Higher markdowns reduced realized prices and revenue, even though the merchandise mix carried higher ticket prices. Running sales nearly doubled, while lifestyle and court-style footwear declined sharply. New Balance was the clear standout, supported by retro-running designs and retailer-specific products. Adidas was identified as the greatest strategic concern because it represents about one-quarter of sales but lacks compelling innovation. Skechers also presents material inventory risk due to weak sell-through and possible consumer movement toward dress footwear. Inventory is currently healthy following cancellations and returns negotiated with suppliers. Continued weak demand could require aggressive winter clearance activity. Supply availability remains stable, with no meaningful shipping disruption reported. The expert expects New Balance, Salomon and either On or Hoka to lead near-term performance.

Competitive Landscape

10/11/2026 at 11:37 AM UTC

Brand

Positioning and outlook

New Balance

Strongest performer; sales more than doubled, with further assortment expansion planned.

Puma

Adidas

Slightly negative overall but supported by running, kids and entry-price products; required substantial promotions.

Underperformed due to weak classic court styles, unsuccessful walking products and limited innovation.

Skechers

Slight quarterly decline but a major risk because of its scale and weak recent sell-through.

Joma

ASICS

Smaller brand gaining traction at entry prices.

Recent performance weakened materially, partly due to insufficient seasonal color selection.

Salomon, On, Hoka

Viewed as likely future winners in performance footwear.

Quantitative Insights

Metric

3Q26 sales growth

Year-to-date growth

September sales

September units

Merchandise ticket-price mix

Average selling price

Markdown rate change

Running share of footwear

Men’s and women’s sales

September promotional-sales mix

Inventory aged six months or less

Fall-winter goods received

Expected 4Q growth

Expected 2027 growth

New Balance future orders

Result

Down 4%

Up 1%

Down 3.5%

Up 2.3%

Up 5%

Down 5%

Up 300 basis points

13%

Down about 7%

60% versus a typical 40%–45%

70%

90%–95%

5%

4%

2.5 times the prior season

10/11/2026 at 11:37 AM UTC

MU: Good morning, everybody. Thanks for listening to today's call. My name is Mayank Upadhyay and I'm an analyst here at Guidepoint Insights. Today's topic of discussion is EU Athletic Footwear Channel Check, CEO of a major Italian retailer on 3Q26 trends, brand performances, inventory health and order book development. We have with us today Marcello Pace to share his opinions and observations on the topic. Marcello, as always, it's a pleasure to have you with us. Thus, it would be great if you could briefly describe your professional background for our audience and then we can start the Q&A. Over to you.

MP: Thank you very much, Mayank. It's always a pleasure for me to be with you. Good morning, everybody. My name is Marcello Pace. I am the CEO for the largest footwear group in Italy for PittaRosse & Scarpe Scarpe. We have 300 shops for almost 4 million square feet of selling space. In Italy we have 300 shops, our shops are a big box format and we sell the full spectrum of footwear, so men's, ladies, kids, slippers, and of course we have a big chunk of our business that is run with sport, with the footwear.

MU: Great. Let's directly jump into quarterly trends. This time we'll do the quarter because we have the quarter that has gone by. So how much did athletic footwear grow for you year over year in 3Q26?

MP: Well, unfortunately in September it was not good at all, because in September it was really much less than our forecasted results because we did minus 3.5. And actually, it was a kind of funny dynamics. I have to say that the consumer spending has been affected definitely by the geopolitical problems that we have. The impact of energy is horrendous and there is so much uncertainty and actually the customer, for this reason, they are not so willing to spend. On top of that, in Italy it was incredibly hot compared to last year. And I have to say, especially when there is some problem, when there is a crisis, when there is uncertainty, the people tend to delay their spending and definitely with that warm, very warm weather... I think today is probably just the first time that I have this weather on... with this warm weather they delay the purchases. So for this reason in September it was really bad, because also we had the back to school, which didn't perform well, in the sense the kids performed a little bit better, but all the rest didn't perform well. And so for this reason we have a minus 3.5% with a quantity that was positive, because the quantity was a plus 2.3%. So that means that we had, unfortunately, to mark down more, to push, to stimulate the purchases of the clients. That was very bad, was really, really bad, and is giving us a lot to consider also for the month to come.

MU: Could you maybe talk about the overall quarter? How do these numbers look for quarter or the third quarter?

MP: Yeah. Well, the quarter was bad because it was pretty much in line with September. So basically it was still negative by 4% for the quarter. And this is bringing a year-to-date business which is just slightly positive by 1%. So that means this quarter has been horrendous because the quarter has eaten up all the positive growth that we had for the rest of the year and you know, the retail price was up, but the average sales price was down because we had to use much more markdown to stimulate the purchases. So for this reason it was the perfect storm, I have to say. A poor consumer spending... we want to stimulate the consumer spending, we spend in more markdown and even we have eaten the advantage on retail price, so we sell kind of a little bit more units... just a little bit more units... but in the end the money in our wallet was less.

MU: Got it. For the rest of the questions, maybe if you have, you know, whole quarterly numbers, please do share that. I understand we have already talked about July, August separately in previous calls.

MP: Yep. Yep.

MU: But for this call, maybe let's try to focus as much as possible MP: Okay.

10/11/2026 at 11:37 AM UTC

MU: on the quarter. So when you...

MP: So.

MU: If MP: I MU: I...

MP: Business minus 4%, retail price plus 5%, ASP minus 5%, markdown plus 300 basis points.

MU: Got it. And when you look at athletic shoes versus dress shoes, are you seeing any difference in footwear growth there? Are market shares moving for you? And what's actually driving these differences in performance?

MP: This is a very good question, Mayank. Actually, this is a trend that we have very timidly, you know, we were seeing in the last few months, but it's getting stronger and stronger. And we see in September, even getting stronger. So basically, it seems that the favor for the sport shoes is slowing and the brown shoes, the civil shoes, as we want to call, is getting more important. Well, actually, in talking about the quarter, in July and August that is quite normal because you have the seasonal shoes which has been always strong, right? The sandals, heel sandals, flat sandals, always very strong. However, we see also in September, it was the first time in probably 2 or 3 years that in the brown shoes we have a resurgence of décolleté, which is incredible. It's the first time in few years that we have a resurgence of dress shoes for men. This is really something which it was a little bit in the air, but that we are now experiencing with the numbers. Is this impacting the sports shoes? Well, it's early to say, but definitely with a consumer wallet that is quite tight, in the sense, if the customer, they buy brown shoes, they don't buy sports shoes. However, I have to say, what do we hope? That one of the reasons of the crisis of the footwear in the last few years, let's say Italy in the last, with the sales before COVID, we lost around 60 million pairs because it was not only consumer spending, but because with the sports shoes so strong, you know, and so well accepted now in all the environments in the sport, when you go out with the girlfriend or when you are in casual, basically just 1 pair, you could cover a few. We do hope, really we do hope, but we don't have any strong sign yet that the brown shoes will be on top of the sport shoes. So the sport shoes will stay, will remain probably a little bit flat and the market will grow depending on what kind of average price and so on with the brown shoes. But answering your question, yes, right now the brown shoes... there are signs that are getting stronger... and sport shoes, they are getting a little bit weaker.

MU: Got it. And when you look at this decline in the quarter, how does it vary between lifestyle and performance coming back to athletic footwear now? How does it vary between lifestyle and performance?

MP: Well, you know, it's very different, the lifestyle, at least in our chain, has been suffering a lot, while the performance are getting stronger and stronger. Just to say, especially the running is doing extremely well. If I take just the running, it's doing almost double compared to last year. Double, which is something which is unheard. Still, the percentage of the running shoes against the total is only 13%, but you know, the growth has been exponential, while the lifestyle is really down. And I have to say, especially the court shoes which are mainly driven by the sales of Adidas, have been really down in the quarter.

MU: Got it. And how did growth vary across price tiers?

MP: The price tiers, I have to say that has been not quite steady, this growth by price tiers. If I see July and August, we've seen the higher price tiers working well, while in September I have seen the higher price tiers suffering. Many reasons behind, I guess, the consumer spending, etc., but we see so in the quarter, we see that the higher price tiers they grew. I see that the entry price have been suffering, but they've been suffering especially because we changed the mix, so we had much less, like I said last month. So I'm not sure if I had more entry price, what could have been the

10/11/2026 at 11:37 AM UTC

results for the total quarter. But definitely still the higher price bracket, which is for us above 70 euros, is still above last year, double digit, but with the September sales impacted on the overall results of the quarter.

MU: Got it. And any difference in performance across genders?

MP: Very much, very much. You have to say that in September, as I say, I take now all the genders, including the running inside them. I think for all the genders, especially the good performance of kids in September brought up the overall sale of kids. Which is more or less going on par, achieving results which is equal to last year, while for men and women we are single digit negative, 7% down compared to the previous years. In volume, sorry, in price, but in turnover.

MU: Which brand gained market share for you and which ones lost out during the quarter?

MP: Well, here we have a dichotomy which is hyper strong. We have brands which are doing super well, which are brands that are doing super bad. Unfortunately, for us, the results in September changed a little bit the dynamics of the overall results. I have to say Skechers was strong in July, was so-so in August, it was very bad in September because it was double digit down in September, which is incredible. But I will tell you after telling the numbers of the brand why do we think is the reason. For Adidas, it has been always bad, but in September went down -13%. So if I take in consideration everything, I have Skechers which is able to go very little slow down by -1% in the quarter. Adidas with the -14% in September, it went down to -7%. Puma recovered in September, so it is just slightly down in the quarter and New Balance even went quicker in September because in September we did 2.5 times the business of last year, which is incredible. I have never seen this kind of numbers in my life. So for New Balance is the winner and New Balance is more than double compared to last year. With a smaller brand we have Joma which is a Spanish brand which I have to say has been consistent, is not the biggest brand, is small but we are really monitoring because it's taking a strong part in the entry price point and we are talking about which it is 40%. Champion has been a little bit better in September but is still negative for the quarter and also all the other brands, Sergio Tacchini etc., are slow in the month. ASICS has been, September has been a super drop. And September is supposed to be a good month for ASICS and for us it became that brought to uneven the quarterly result. I have to say 2 reasons behind. From one side the consumer spending, on the other side I think that we didn't buy enough for the color of the month in September. We are discovering that the brown shoes both in suede, the chocolate colors and so on are really super strong in September and just imagine the shoes that we have with those colors running at a sell-through which is double compared to the basic colors. Unfortunately, my buyers didn't catch up the colors, the trend, and for this reason we bought less and so we didn't gain a full advantage of these trends. On the other side, since there was this uncertainty in the market, also we pushed and we increased the numbers of the NOS item. And that probably in September didn't pay because all the seasonal colors they took off and we didn't do well then.

MU: Any observations around the core franchises of major athletic brands? What worked for you, what did not?

MP: Yes, in terms of franchise, I have to say that they are pretty much the same of the other month. So we have the copy of the 530 of New Balance, which is absolutely the strongest item. We see, especially in September, that the low profile, the copy of the Speedcat, seems to be getting some advantage. But really, the quarter has been a funny quarter because the first 2 months compared to the last month of the quarter have really different dynamics. So it's difficult to talk about a homogeneous quarter, and especially because in Italy the first 2 months of the quarter are sales items, while the third month of the quarter are all the new items getting stronger. However, everything which is running, running 2K, is really doing well. I have to say, in running, at least for our chain, Adidas is not doing well, and the super good running 2K is New Balance, and the running is Puma.

MU: Got it. Any price increases implemented in third quarter? You did say that retail prices were up. So are those what you have been carrying from the beginning of the year or were there any price increases during the quarter also?

10/11/2026 at 11:37 AM UTC

MP: Article against article, there has been no price increase. Of course, the mix brought us this 5% increase in prices, which has been eroded by the additional markdowns. So basically, all the brands are very conscious with the price, and we don't see any increase in prices from the brands, and we follow very much the retail price suggested, so that we don't have any, for this reason, changes from the suggestions of the brand.

MU: But any new launches that are noteworthy?

MP: Well, I have to say New Balance did a fantastic job in enlarging the offer with the articles, with the products which are inspired by the aesthetic concept of the 530, of the New Balance 530. And this is what is driving the incredible result. I have to say that New Balance is the brand which has been the best in doing this kind of special makeup available for the multi-brand footwear like us and this is really pushing the retro running of New Balance to these very strong results. The rest is really pretty much repetition of what was already in the market.

MU: Got it. Maybe you talked about the impact of promotion. I think 300 basis points you mentioned. Could you talk about the proportion of sales that were driven through promotions and any particular brands which were most impacted by promotions?

MP: Yes, yes, definitely. This is a talk about September because in July and August, August has been a discount month, a sales month. But in September, surprisingly, 60% of our sales were coming from sales items, which is very much above the level that we usually have at this time. We are supposed to be between 40-45%. We had 70% in July and August, which is pretty much normal, and 60% in September. That has been really high. And this is because in order to stimulate demand, as I said before, we had to push for markdowns. I have to say, definitely I can tell you where we didn't give markdown, New Balance, we didn't give any markdowns. We pushed our markdowns with Puma. Just you consider in Puma, we achieved just in September a parity against last year with 12% more volume. So that means that really there was... it is clear that we had more markdowns. We had a stronger markdown with the champions and with a smaller brand. So in the big brand, Puma has been mostly affected by markdowns, but gained volume and we use markdown with all the smaller brands in order to stimulate the lack of demanding which I was talking about earlier.

MU: How healthy are current inventory levels for you and the proportion of 0 to 6 months old inventory?

MP: Well, right now we have 0 to 6 months. Our inventory is healthy. It basically is the same as last year. However, I will tell you the numbers later on. But you know why? Because we have been discussing with the brands, with all the brands, no exception, and the brands have, I have to say, understood the situation. We have been able to, in some cases, cancel some orders that we didn't take, in some cases, return some shoes. So the percentage of new stock right now is 70%, which is very healthy at this point of time. However, we are monitoring very closely because if the sales are not bouncing back in the Q4, probably we are going to have a problem in stock. So what it means is that since it will not be possible to go back to the brands and tell, "Sorry," it won't be possible to go back to the brands and tell them to take back some shoes. We will have to push on markdowns in December and probably in January and February, which are the months also devoted to markdowns. We will have to push on markdowns also much more than last year. So right now is okay. Let's monitor really what we will have in front, ready to move to do markdowns during Q4, and eventually will be a very strong markdown action in January and February.

MU: Got it. And based on your order book, which brands have the most exciting pipeline for you and where do you anticipate challenges?

MP: Well, it's a very good question because yesterday we were reviewing all the open to buy with our guys. And most exciting, New Balance. We think that will continue to do well. We think that is going to be very strong. Our open to buy will be 2.5 times what has been in the last season. The biggest challenge I have to say is going to be Skechers

10/11/2026 at 11:37 AM UTC

because Skechers is now for us the number 1 brand. And we've always been expecting to grow. If I take overall, our stock is not a problem, but in Skechers, the sell-through has not been good. So we are monitoring Skechers very, very closely because if there is a slowdown in the business of Skechers, it's going to be quite a big problem and probably Skechers could be one of the most affected by the switch of the customer sentiment versus the brown shoes because they are sports shoes but they are kind of walking shoes. In terms of Puma, we think that they have a very good collection with kids and especially on the order books that we have, they are very strong on the entry price point. Adidas is really a question mark. It's really a question mark because Adidas is on par with Skechers in terms of brands. And if the Grand Court and the classic shoes are not coming back, well, that is going to be a major problem for us.

MU: How's the supply visibility of in-demand brands and models?

MP: All the brands have confirmed their shipment. There is no delay whatsoever, so it means there is no impact from Hormuz, from the Middle East war, from anywhere in the supply chain. Everything is confirmed and up to date. We already received 90-95% of the total supply for the fall-winter and all the advanced delivery for spring-summer are already confirmed from what we are going to receive in September and December.

MU: Got it. And what growth are you expecting in athletic footwear for the fourth quarter as well as the overall 2027?

MP: Well, that's a question that I'm not sure the answer. I have to say that I'm always quite bullish right now with the first few days. I have to say the first 3 days of October has been, the first 4 days of October has been bad, but the last 4 days has been quite good. So we'd say that the fourth quarter, we expect a plus 5%, which is lower than our expected double digit. It was down to 9, it was down to 8. I take a more cautious approach, especially I am a bit less humble thanks to the last 4 days and we expect a plus 5% in the Q4.

MU: And for 2027, any initial target that you guys might be thinking of?

MP: Yes, we are thinking that we will be at low single digit growth. So it's going to be a plus 4%. Especially because it has been so bad this year. So we think that all the activities that we put in place with the marketing activation that we are planning, one thing that we are doing with our brands, with our brand partner, we are planning many more brand activation in the shops. That will be one of the key for the next year in order to sustain and grow.

MU: Any price increases planned in the near term? Or as you said, even if not in like for like, but for new launches, are you expecting price increases versus previous models?

MP: No, 0. I don't expect any. We will start the visit to the brands mid of this month and probably I could be more precise next month eventually. But so far, the preliminary interactions with the brand, they are telling us that there are no price increases.

MU: Got it. Maybe given the lack of time, maybe you could pick your 3 winners for 4Q27 or maybe for the near term and 3 losers and brief reasoning, that would be great.

MP: For the next year, New Balance, Salomon, and I'm not sure between On and Hoka if I have to take the 3. The 3 losers, Adidas, Skechers, and one of the smallest brands.

MU: Got it. Maybe on Adidas, if you would give us a color, what do you think is not currently working or what do you think has stopped working for Adidas because of which the momentum is down?

MP: Well, you know, there is really a lack of new introductions. They always have relied on the classic styles, which have been flooding the market from the top of the price points down. Yes, they are trying to refresh a little bit with some colors so far, but I don't see any really strong innovation. They push a lot on the walking, which was an absolute

10/11/2026 at 11:37 AM UTC

disaster for us. So I have no confidence at this moment. Of course, it depends if they will take, as you say, the rabbit out of the hat with the next collection, at least with a couple of franchises which will be supported and will be very well received by the customers. But so far, it's really a great cause of concern. And you know, when your top 1 or top 2 brand is not giving you volume, that is a serious problem for us. You know, Adidas for us is a problem if it is -1%. So for this reason, you know, for me it is a great cause of concern because it's a quarter of my sales. So and that... I have to think how to replace it eventually.

MU: Great. So with that, we are at the end of the line here, Marcello. Thank you so much for taking time out and sharing your insights with us.

MP: Thank you very much, Mayank. Thank you to everybody. Have a good day and have a great day.

DISCLAIMER: The statements or opinions expressed today are those of the Advisor and not Guidepoint, who disclaims all liability for the content provided. The Advisor may not disclose material nonpublic or confidential information or any information that would cause the Advisor to breach any duty or obligations. Guidepoint is not a registered investment advisor and the information provided is not intended to constitute investment advice.

10/11/2026 at 11:37 AM UTC