For more than two years, Puma SE‘s top brass spoke of “elevating” the German brand and making its sneakers and apparel more aspirational. Since arriving last month, Chief Executive Officer Arthur Hoeld has delivered a fairly blunt verdict: Puma, if anything, is now perceived as cheap.
Hoeld, a decades-long veteran of cross-town rival Adidas AG, has the task of turning Puma around and charting a return to profit and growth. It’s not the first time the 77-year-old brand has needed a makeover, and former bosses like Jochen Zeitz, now head of Harley-Davidson, and Bjorn Gulden, who became CEO of Adidas in 2023, both found ways to revitalize Puma’s leaping cat.
But Hoeld has significant hurdles to clear. Fast-growing brands like On Holding AG, New Balance and Hoka are winning customers and taking more shelf space at retailers. Adidas is still riding high on its retro Sambas, while industry leader Nike is bouncing back under company veteran Elliott Hill with products like the Vomero 18 running shoe, after a rare rough patch for the Swoosh.
Then there are challenges Puma can do little to control: a fast-appreciating euro and US President Donald Trump’s trade tariffs ramping up industry costs. Hoeld took the first step toward what looks like a textbook reset on July 24, delivering a brutal financial reappraisal that sees a 20% plunge in sales in the coming months and Puma losing money this year.
“That tells you that something is really quite wrong,” said Piral Dadhania, an analyst at RBC Capital Markets. “This is a fairly high-risk sort of turnaround. The execution becomes much more relevant in that situation.”
Hoeld first has to stop the bleeding. He is inheriting a growing pile of unsold sneakers and apparel in warehouses around the world that could take Puma more than a year to work through and to convince retailers to buy from the brand again, Deutsche Bank analyst Adam Cochrane said in a note.
“It’s pretty toxic,” said Ingo Speich, a portfolio manager with Deka Investment in Frankfurt, a major Puma shareholder. “If you produce more and more shoes and widen your product range – at the same time as you get less retail space because other brands are far stronger – then it gets difficult.”
After Puma’s profit warning, Hoeld linked the inventory challenge to big-picture questions that could take months to answer and even longer to execute on. “Do we have the right products for our consumers and our wholesale partners?” he asked. “If so, why is our brand not achieving the required visibility and engagement?” He promised to unveil his strategy in late October.
The slump is badly timed. The sneaker world has transformed in the past decade as Adidas and Nike pulled back from many retail partners, prioritizing direct-to-consumer sales channels in hopes of boosting profits. That approach backfired, with consumers embracing smaller brands like On, Hoka and New Balance that secured their products more space on retailers’ shelves.
Puma, though, failed to capitalize on Nike’s stumbles, while Adidas quickly reversed course under Gulden, winning back retailers who couldn’t get enough of the three-striped Sambas and similar models. Since Hill returned to Nike last fall, he’s been repairing relationships with retail partners including Amazon.com, and the company appears set for a new era of growth.
Underdog
For decades, Puma has occupied a tricky spot in the sporting goods world. Though it competes in everything from football and basketball to running, it’s much smaller than its main rivals Adidas and Nike in that multi-sport game. Its products typically command lower prices, though it’s had success when it carves out a niche, often as the underdog brand.
When Gulden arrived at Puma in 2013, he refocused the company on performance sports and leaned heavily on the brand’s one genuine superstar: sprinter Usain Bolt.
Fast-forward just over a decade and there was little of that rebellious spirit in Puma’s “Go Wild” ad this spring, which was aimed at everyday runners looking for feel-good vibes. The campaign struggled to stand out against Adidas’s no-stress “You Got This” push, or On’s video featuring Sesame Street’s Elmo.
