Net profit surges over 4 times, but Arc'teryx "drops from the pedestal"? The hidden concerns behind the spotlight on Amer Sports

On February 24, Amer Sports delivered a dazzling report card.

In 2025, the company’s revenue grew by 27% year-on-year to $6.566 billion, with fourth-quarter revenue increasing by 28% to $2.101 billion; net profit attributable to the parent company surged by 489% to $427 million. The three core business segments, including Arc’teryx and Salomon, as well as major global markets, all achieved double-digit growth, with the Greater China region growing by 43.4% year-on-year, becoming a significant growth engine. Meanwhile, direct-to-consumer (DTC) channel revenue increased by 41.5% year-on-year to $3.209 billion, driving gross margin up by 220 basis points to 57.6%.

Behind this “highlight” financial report, costs and risks are also accumulating simultaneously.

In the past year, Arc’teryx has repeatedly fallen into controversies over fireworks shows, PFAS, and product quality. Although the segment maintained high growth in the fourth quarter, short-term sales were not significantly impacted, but market signals have quietly shifted: “Double Eleven” dropped out of the top rankings, and some limited edition items faced a cooling off. Industry analysis suggests that Arc’teryx’s brand reputation has been damaged, which may have shaken external judgments about its growth sustainability. Regarding the long-term growth potential of the core brand and the risks brought by rapid expansion, a reporter from Beijing News Beike Finance sent an interview inquiry to Amer Sports, but no response was received by the time of publication.

Against this backdrop, Amer Sports is accelerating the promotion of its second growth curve. The revenue of the mountain outdoor apparel and equipment segment grew by 29% year-on-year in the fourth quarter of 2025, and 31% for the entire year, with Salomon’s annual sales exceeding $2 billion for the first time.

At the same time, cost pressures continue to rise. The financial report shows that in the past five years, Amer Sports’ marketing expenses have doubled to $3.1 billion. The company explained that to support store expansions, new store openings, and the expansion of Salomon’s footwear and apparel product lines, sales, management, and administrative expenses increased, resulting in a 90 basis point decline in operating profit margin to 10.9% in the fourth quarter of 2025, while the operating profit margin for the mountain outdoor apparel and equipment segment fell to 6.2%.

As Arc’teryx and Salomon rapidly break into mainstream markets through “lifestyle” and “fashion labels,” doubts about whether “traffic is diluting professionalism” continue to ferment. Cheng Weixiong, a brand strategy consultant in the footwear and apparel industry and founder of Shanghai Liangxi Brand Management Co., pointed out that Amer Sports has quickly established a leading advantage in China through its DTC model, but during its expansion, it must maintain a basic respect for nature, professionalism, and local culture. “For Arc’teryx, localization should not undermine its original spirit and professional core—its benchmark has always been the world’s top professional brands in the minds of core outdoor users.” He emphasized that how to strengthen technology and product capabilities in the Chinese market, rather than allowing fashionable categories to dominate performance structure, will be a key test for the brand’s long-term development.

Arc’teryx “loses momentum,” Salomon closely follows

In Amer Sports’ rapid progress, the leading brand Arc’teryx, which shoulders the growth burden, has shown some signs of “fatigue” and frequently feels challenges from its fellow brand, Salomon.

The financial report shows that in 2025, Amer Sports’ revenue reached $6.566 billion, an increase of 27% year-on-year. Among them, the outdoor functional apparel segment where Arc’teryx belongs saw revenue grow by 30% year-on-year to $2.856 billion; while the mountain outdoor apparel and equipment segment where Salomon belongs grew by 31% year-on-year to $2.404 billion. Looking at the annual performance, Arc’teryx still has a slight edge, but the gap has clearly narrowed, with both sides nearly evenly matched.

Since last year, Arc’teryx’s growth trend has slowed. In the second quarter of 2025, Arc’teryx’s segment revenue was $509 million, a 23% year-on-year increase. Although the segment still maintained double-digit growth, the growth rate has significantly declined compared to previous quarters. Data shows that in the third and fourth quarters of 2024 and the first quarter of 2025, Arc’teryx’s segment revenue growth rates were 34%, 33%, and 28%, respectively.

In the third quarter of 2025, Arc’teryx’s segment revenue grew by 31% year-on-year to $683 million, while Salomon’s performance was even more impressive, with revenue growth reaching 36% to $724 million, achieving a surpass. It wasn’t until the fourth quarter that Arc’teryx managed to regain some ground.

Seven years ago, after the consortium led by Anta Group completed its acquisition of Amer Sports, Arc’teryx quickly “broke the circle” in the Chinese market, transforming from a niche professional outdoor brand into a trendy symbol for urban consumers. However, this rapid expansion also laid the groundwork for subsequent brand risks.

Last year, an untimely fireworks show brought Arc’teryx down from its “pedestal.” In September 2025, Arc’teryx collaborated with artist Cai Guoqiang to hold the “Ascension Fireworks Show” in the Himalayas of Tibet, which sparked huge controversy. Investigations revealed that the event caused ecological damage, and as the sponsor, Arc’teryx was legally responsible for ecological restoration and compensation. Following this incident, the General Manager of Arc’teryx Greater China, She Yifeng, announced his resignation. As a result, the parent company Amer Sports’ stock price once fell sharply.

From a short-term performance perspective, this credibility crisis does not seem to have affected sales performance. In the fourth quarter of 2025, Arc’teryx’s revenue still increased by 34% year-on-year to $1 billion. However, during last year’s “Double Eleven,” Arc’teryx fell out of the top 20 in Tmall’s outdoor brand rankings. Previously, Arc’teryx had remained in the top ten of Tmall’s “Double Eleven” outdoor brand rankings for three consecutive years.

“Winter is the peak season for outdoor brand sales, and market demand has supported Arc’teryx’s performance to some extent; its high-end positioning and brand influence still hold sway,” said Wang Ning, a senior researcher at Huayue Think Tank. However, the credibility crisis may gradually manifest in the coming years, “In the long term, related disputes and complaints may erode brand credibility and weaken its market advantage.”

Cheng Weixiong believes that the Chinese outdoor market has vast potential, and since Amer Sports was acquired by Anta, it has formed a highly localized brand, product, and channel operation system that precisely meets the consumption needs of the middle class in China regarding outdoor lifestyles and fashion. “However, after Arc’teryx’s brand reputation was damaged, its growth certainty has become wobbly; for instance, the market response to the limited edition items in 2026 did not meet expectations.” He emphasized that as DTC channels continue to expand in China, Arc’teryx’s high-price strategy will inevitably face tests in a broader market.

Concerns about Arc’teryx’s trust among consumers have long been evident, as it has been embroiled in controversies regarding “harmful substances” and “product quality” since 2025. In March of last year, reports indicated that multiple waterproof jackets were found to contain PFAS substances. Arc’teryx responded that its products met national standards, but its domestic product pages did not explicitly indicate the presence of fluorine, whereas related products were marked with “PFAS warning” on overseas websites such as Canada. As of February 25, there have been 4,354 complaints related to Arc’teryx on the Black Cat Complaint Platform, focusing on quality issues and after-sales experience, including problems like shoe upper delamination, short sleeves having loose threads, and jackets pilling easily.

Previously, Arc’teryx’s rarity and premium capability were particularly prominent in the second-hand market; the official price of the Year of the Snake limited edition jacket, priced at 8,200 yuan, had been speculated to 20,000 yuan, and even the hangtags became “hard currency.” However, as consumers demystified the brand, this year’s Year of the Horse limited edition jacket (priced at approximately 7,800 yuan) appeared for resale at its original price on second-hand platforms.

The Game of Traffic and Professionalism: Amer Sports’ Dilemma

Despite the impressive current performance, Amer Sports has only been profitable for a few short years.

The financial report shows that between 2021 and 2023, Amer Sports was in a long-term loss state, with net losses of approximately $126 million, $253 million, and $209 million, respectively. It wasn’t until 2024 that the company turned a profit—revenue reached $5.183 billion, up 18% year-on-year, with a net profit of approximately $73 million, up 135%.

The key contributors to performance are undoubtedly Arc’teryx and the subsequently rising Salomon. In 2024, Arc’teryx’s annual sales exceeded $2 billion, contributing nearly 40% of the group’s revenue; Salomon’s annual sales also surpassed $1 billion, becoming the second growth pole. By 2025, the revenue share of the segments where Arc’teryx and Salomon belong was 44% and 37%, respectively, with Salomon’s annual sales exceeding $2 billion for the first time.

Regionally, the importance of the Greater China region has become increasingly prominent. In 2025, Amer Sports’ revenue in Greater China grew by 43.4%, significantly higher than the Americas (14.3%) and Europe, the Middle East, and Africa (19.3%). In other words, the Chinese market has become an important growth engine for Amer Sports.

“The popularity of Arc’teryx and Salomon in China is largely attributed to market dividends,” Wang Ning pointed out. The outdoor consumption in China continues to heat up, providing a favorable environment for brand expansion. Public data shows that the scale of China’s outdoor products market has reached the trillion level and has maintained double-digit growth for several consecutive years, with growth rates significantly higher than the overall level of the global outdoor products market. “Both Arc’teryx and Salomon, which combine professional attributes with trendy labels, happen to hit the intersection of consumption structure upgrades and changes in the aesthetics of urban middle-class consumers.”

However, the downside is that costs and risks are also accumulating simultaneously. The financial report shows that Amer Sports’ marketing expenses have continued to rise, increasing from $1.3 billion in 2021 to $3.1 billion in 2025. Meanwhile, outdoor products themselves have strong seasonal characteristics, high prices, and longer turnover cycles, which also increase inventory pressure. In 2025, Amer Sports’ inventory grew by 33% year-on-year to $1.622 billion.

At the same time, in the high-end outdoor segment, Amer Sports is facing multiple “attacks”: among international brands, Mammut, Patagonia, The North Face, and Black Diamond continue to deepen their focus on the professional outdoor field; in terms of domestic brands, companies like Kailas are rapidly rising with localized operations and more cost-effective products.

Against this backdrop, Amer Sports is also actively seeking new growth drivers. On one hand, Arc’teryx is accelerating its layout in the women’s market. In the fourth quarter of 2025, women’s categories became its fastest-growing segment, with a year-on-year increase of over 40%. On the other hand, the running boom continues to heat up, boosting overall outdoor footwear strength, with Salomon’s strong sales performance also making Amer Sports more optimistic about the outdoor footwear segment and increasing investment. The financial report shows that by the end of 2025, the total number of Salomon stores in Greater China reached 286, with a net increase of nearly 100; approximately 35 more stores are expected to be added in 2026.

Cheng Weixiong believes that in recent years, Amer Sports has continually introduced lifestyle labels such as “old money style” and “young girl style” into its operations, demonstrating that its team is quite adept at extending professional brands into the fashion and leisure sectors. This, to some extent, benefits from the successful experiences of previous international sports brands in the Chinese market. “Such strategies help the brand quickly amplify its voice and gain traffic, transitioning from niche professional circles to broader visibility, undoubtedly serving as a ‘stimulant’ for short-term performance growth.”

“However, in the long run, this expansion driven by lifestyle and fashion collaborations may dilute the professionalism and scarcity value on which the brand originally relied.” He cautioned that for a company positioned as a professional outdoor multi-brand platform, how to balance short-term performance pressures with long-term brand equity remains a key issue that Amer Sports must face.