Bike Boom Demand Continues Into Q3 - Revenue Round Up
Financial reports have been released for Q3 (July-September) 2020 and the COVID bike boom still seems to be positively affecting the industry. Demand for products remains high due to customers still living in a socially distanced world and governments investing in cycling infrastructure. How long will the bike boom last? Can we make this growth sustainable? And when will supply and demand even out? We've put these questions to the industry and will be publishing them in a Burning Question next week.
Fox Notches Record Quarter with Bike Division Revenue Growing 32%
![photo]()
Fox has announced a record third quarter that includes a 32% growth in revenue from its Speciality Sports Group (Fox, Marzocchi, Easton, RaceFace). Sales across the business rose 23.4% to $260.7 million versus $211.3 million for the same period last year. This increase in sales can be broken down into a 17.7% increase in Powered Vehicles Group and a 32.4% increase in Specialty Sports Group. Fox claims that demand for both aftermarket and OE equipment have driven the increase in sales for the Speciality Sports Group.
Sales for the first nine months of the year are also up for Fox. From January 1 to October 2, Fox recorded $628.2 million in sales, an increase of 11.2% compared to the same period in 2019.
Mike Dennison, Fox CEO, said, "Our record third quarter results demonstrate not only the success of our superior products but also the phenomenal resilience and execution by our entire global team. With swift allocation of resources, we were able to take advantage of the strong demand trends within our end markets, while still driving gross margin improvement amid an uncertain and complex manufacturing environment. Based on the strength of our year-to-date results and our expectation for momentum to continue through the fourth quarter, we are pleased to reinitiate annual guidance for 2020.”
More info, here.
Shimano Bicycle Sales Down 3.8% with Increased Income
![Shimano factory visit 2018]()
Shimano's bike division reported a decline in sales for the third time in 2020, but it was able to report an increased operating income of 4.9% (44,131 million yen). Shimano's sales fell by 3.8% in the period of July-September, but when compared to its decline of 14.6% in the first half of the year this quarter's fall to 204,499 million yen could represent something of a recovery.
The Japanese component brand's quarterly report noted demand for bicycles began to rapidly increase from early spring, as cycling is an easy form of recreational exercise and a mode of transportation with a lower risk of infection. As demand kept rising, however, it began to outstrip supply, and there were shortages in distributor inventories in Europe, North America and China.
The report made special note of the brand's Deore MTB range that "continued to be well-received in the market".
More info, here.
Demand for Hope Products Doubles
![Hope Tech]()
Demand for Hope products is currently 100% greater than normal levels. Hope reopened its factory in April and since then has invested around £1.5 million in new machinery and taking on manufacturing staff to scale up the production. It has continued working around the clock and has also increased its number of night shift staff. This has allowed it to ship out 25-30% more product but it admits there have still been some shortages for its product as with most manufacturers.
Hope is apparently seeing demand outstripping supply for both B2C and B2B and is even fielding calls from bike shops it has never worked with before that are desperate for some product to sell. Hope said: "With our passion for keeping all production on-site in Barnoldswick, there will always be a restriction on annual growth. We are still not comfortable sub-contracting any of our production and losing control of quality."
More info, here.
Bike Imports at Highest Levels for 5 Years in USA
Two reports have shown bike imports to the United States were up in both July and August. US Department of Commerce figures picked up by Bicycle Retailer and Industry News, show that 1.9 million bikes worth $151 million were imported in July and 1.7 million bikes worth $142 million were imported in August. This represents the highest level of bike imports since April 2015, when the industry brought in bikes worth $180 million.
The increase in imports is likely due to the increased demand for bikes as well as replenishing stock from lockdowns and factory shutdowns in Asia. BRAIN also notes that, "In July and for the first week of August, importers had an extra incentive to up the pace: a 25% tariff on China-made bikes that took effect Aug. 7."
Dorel Sports Records Sixth Consecutive Quarter of Revenue Growth.
Dorel, the parent company of GT, Cannondale and Mongoose that recently announced its intentions to go private in the near future, has reported that sales in its Sports division were up 22% to $306 million in Q3. This is the sixth quarter in a row that revenues have increased year on year. Martin Schwarz, CEO, said: "In Sports, the second quarter trend of increased demand for bicycles continued and outpaced product availability. In spite of this, the segment was still able to achieve the highest earnings in its history."
Dorel tempered expectations by forecasting difficulties ahead and a challenging fourth quarter. Its report noted that lockdowns were being re-instated in Europe and challenges on transportation, cost increases and supply out of Asia, plus the recent strength of the Chinese Yuan relative to the US dollar, could also result in cost increases.
GoPro Revenue Jumps 114%
![photo]()
GoPro's Q3 revenue has increased by 114% and is up 109% sequentially from Q2. Last year's Q3 was a particularly weak one for GoPro following a production delay with the new Hero 8 cameras, which shifted the bulk of its sales from the third quarter to the fourth quarter. Unfortunately, GoPro had already announced the camera, which meant demand for the Hero 7 fell as it was no longer the brand's flagship model.
This year, GoPro had the release of the Hero 9 Black in Q3 to help boost its figures and it resulted in a very strong quarter. Revenue was $281 million, up from $131 million in 2019 but still a bit below 2018's $285 million. GoPro also ended Q3 2020 with 501,000 subscribers on its PLUS platform (which costs $69.99 per year ($5.83pm), or $7.49 if you go month-to-month), which is up 35% sequentially and 65% year-over-year.
More info, here.
MIPS Continues Strong 2020
MIPS' net sales increased by 94% to SEK 102m in Q3, meaning it accounts for nearly half the brand's annual sales of SEK 225m for the year to date. The quarter was the strongest in the history of MIPS and generated an operating profit of SEK 55m. MIPS sales were down 20% in Q2 as "helmet manufacturers pulled the emergency brake" due to COVID but its sales have now recovered in Q3 enough that the Swedish brand's net sales from January to September have increased by 24% year on year to SEK 225m.
Max Strandwitz, President and CEO, said: "Demand from the US has primarily been driven by sales of bicycle helmets specifically for recreational use. The market situation in Europe has been favorable mainly from strong demand for bicycle helmets used for commuting."
More info, here.
Leatt Revenue Grows 18% Year on Year
![Richard Kurowski Photo]()
Leatt has reported an 18% growth in revenue in its third quarter from $9.65 million in 2019 to $11.37 million in 2020. This increase in revenues is attributed to a $1.16 million increase in body armor sales, and a $1.38 million increase in sales of other products, parts and accessories but they were partially offset by a $0.76 million decrease in neck brace sales, and a $0.07 million decrease in helmet sales during the period. The third quarter forms part of a strong first 9 months of the year for Leatt with 23% higher revenues from the same period in 2019.
More info, here.
E-Bikes Become More Than a Quarter of Giant's Growing Revenue
Giant's third-quarter revenue increased 14.6% to NT$19.47 billion with 27% of that total now coming from e-bikes. Giant said in a press release that countries where consumers are still sticking to social distancing guidelines, "are turning to bicycles and e-bikes to commute or as an alternative form of exercise to keep themselves fit and healthy." This has gone hand-in-hand with greater investment in cycling infrastructure that has helped to boost demand.
Giant also noted that "E-bikes sales price and margins are much higher than traditional bikes" and have contributed to not only an increase in revenue but an increase in gross margin too. The Taiwanese company said it would continue to grow its range and production of e-bikes to grow its market share.
Fox Notches Record Quarter with Bike Division Revenue Growing 32%
Fox has announced a record third quarter that includes a 32% growth in revenue from its Speciality Sports Group (Fox, Marzocchi, Easton, RaceFace). Sales across the business rose 23.4% to $260.7 million versus $211.3 million for the same period last year. This increase in sales can be broken down into a 17.7% increase in Powered Vehicles Group and a 32.4% increase in Specialty Sports Group. Fox claims that demand for both aftermarket and OE equipment have driven the increase in sales for the Speciality Sports Group.
Sales for the first nine months of the year are also up for Fox. From January 1 to October 2, Fox recorded $628.2 million in sales, an increase of 11.2% compared to the same period in 2019.
Mike Dennison, Fox CEO, said, "Our record third quarter results demonstrate not only the success of our superior products but also the phenomenal resilience and execution by our entire global team. With swift allocation of resources, we were able to take advantage of the strong demand trends within our end markets, while still driving gross margin improvement amid an uncertain and complex manufacturing environment. Based on the strength of our year-to-date results and our expectation for momentum to continue through the fourth quarter, we are pleased to reinitiate annual guidance for 2020.”
More info, here.
Shimano Bicycle Sales Down 3.8% with Increased Income
Shimano's bike division reported a decline in sales for the third time in 2020, but it was able to report an increased operating income of 4.9% (44,131 million yen). Shimano's sales fell by 3.8% in the period of July-September, but when compared to its decline of 14.6% in the first half of the year this quarter's fall to 204,499 million yen could represent something of a recovery.
The Japanese component brand's quarterly report noted demand for bicycles began to rapidly increase from early spring, as cycling is an easy form of recreational exercise and a mode of transportation with a lower risk of infection. As demand kept rising, however, it began to outstrip supply, and there were shortages in distributor inventories in Europe, North America and China.
The report made special note of the brand's Deore MTB range that "continued to be well-received in the market".
More info, here.
Demand for Hope Products Doubles
Demand for Hope products is currently 100% greater than normal levels. Hope reopened its factory in April and since then has invested around £1.5 million in new machinery and taking on manufacturing staff to scale up the production. It has continued working around the clock and has also increased its number of night shift staff. This has allowed it to ship out 25-30% more product but it admits there have still been some shortages for its product as with most manufacturers.
Hope is apparently seeing demand outstripping supply for both B2C and B2B and is even fielding calls from bike shops it has never worked with before that are desperate for some product to sell. Hope said: "With our passion for keeping all production on-site in Barnoldswick, there will always be a restriction on annual growth. We are still not comfortable sub-contracting any of our production and losing control of quality."
More info, here.
Bike Imports at Highest Levels for 5 Years in USA
Two reports have shown bike imports to the United States were up in both July and August. US Department of Commerce figures picked up by Bicycle Retailer and Industry News, show that 1.9 million bikes worth $151 million were imported in July and 1.7 million bikes worth $142 million were imported in August. This represents the highest level of bike imports since April 2015, when the industry brought in bikes worth $180 million.
The increase in imports is likely due to the increased demand for bikes as well as replenishing stock from lockdowns and factory shutdowns in Asia. BRAIN also notes that, "In July and for the first week of August, importers had an extra incentive to up the pace: a 25% tariff on China-made bikes that took effect Aug. 7."
Dorel Sports Records Sixth Consecutive Quarter of Revenue Growth.
Dorel, the parent company of GT, Cannondale and Mongoose that recently announced its intentions to go private in the near future, has reported that sales in its Sports division were up 22% to $306 million in Q3. This is the sixth quarter in a row that revenues have increased year on year. Martin Schwarz, CEO, said: "In Sports, the second quarter trend of increased demand for bicycles continued and outpaced product availability. In spite of this, the segment was still able to achieve the highest earnings in its history."
Dorel tempered expectations by forecasting difficulties ahead and a challenging fourth quarter. Its report noted that lockdowns were being re-instated in Europe and challenges on transportation, cost increases and supply out of Asia, plus the recent strength of the Chinese Yuan relative to the US dollar, could also result in cost increases.
GoPro Revenue Jumps 114%
GoPro's Q3 revenue has increased by 114% and is up 109% sequentially from Q2. Last year's Q3 was a particularly weak one for GoPro following a production delay with the new Hero 8 cameras, which shifted the bulk of its sales from the third quarter to the fourth quarter. Unfortunately, GoPro had already announced the camera, which meant demand for the Hero 7 fell as it was no longer the brand's flagship model.
This year, GoPro had the release of the Hero 9 Black in Q3 to help boost its figures and it resulted in a very strong quarter. Revenue was $281 million, up from $131 million in 2019 but still a bit below 2018's $285 million. GoPro also ended Q3 2020 with 501,000 subscribers on its PLUS platform (which costs $69.99 per year ($5.83pm), or $7.49 if you go month-to-month), which is up 35% sequentially and 65% year-over-year.
More info, here.
MIPS Continues Strong 2020
MIPS' net sales increased by 94% to SEK 102m in Q3, meaning it accounts for nearly half the brand's annual sales of SEK 225m for the year to date. The quarter was the strongest in the history of MIPS and generated an operating profit of SEK 55m. MIPS sales were down 20% in Q2 as "helmet manufacturers pulled the emergency brake" due to COVID but its sales have now recovered in Q3 enough that the Swedish brand's net sales from January to September have increased by 24% year on year to SEK 225m.
Max Strandwitz, President and CEO, said: "Demand from the US has primarily been driven by sales of bicycle helmets specifically for recreational use. The market situation in Europe has been favorable mainly from strong demand for bicycle helmets used for commuting."
More info, here.
Leatt Revenue Grows 18% Year on Year
Leatt has reported an 18% growth in revenue in its third quarter from $9.65 million in 2019 to $11.37 million in 2020. This increase in revenues is attributed to a $1.16 million increase in body armor sales, and a $1.38 million increase in sales of other products, parts and accessories but they were partially offset by a $0.76 million decrease in neck brace sales, and a $0.07 million decrease in helmet sales during the period. The third quarter forms part of a strong first 9 months of the year for Leatt with 23% higher revenues from the same period in 2019.
More info, here.
E-Bikes Become More Than a Quarter of Giant's Growing Revenue
Giant's third-quarter revenue increased 14.6% to NT$19.47 billion with 27% of that total now coming from e-bikes. Giant said in a press release that countries where consumers are still sticking to social distancing guidelines, "are turning to bicycles and e-bikes to commute or as an alternative form of exercise to keep themselves fit and healthy." This has gone hand-in-hand with greater investment in cycling infrastructure that has helped to boost demand.
Giant also noted that "E-bikes sales price and margins are much higher than traditional bikes" and have contributed to not only an increase in revenue but an increase in gross margin too. The Taiwanese company said it would continue to grow its range and production of e-bikes to grow its market share.
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www.backcountrysafe.ca
I think it’s also worth mentioning, the boom in season pass sales has made resort skiing much less enjoyable than in the past. Huge lift lines, pay to park, limited terrain for midweek and locals aka saving all the good stuff for the out of town weekend warriors (looking at you Squaw Valley), crazy expensive food, drink and amenities.
People will be fine, the world will be fine, don’t worry about other people, quite frankly it’s not our concern.
People are people wherever you go.
I am hoping the consensus is that people will take opportunities to gain knowledge and educate themselves in the risks and skills needed to access avalanche terrain. From there they need mentors to lead and foster their developing spidey sense.
How many of these people will be experienced enough to be ok with turning around after driving for 3 hours at 5am, they dig a pit and realize the snow pack is shit. Or will they even dig one and go right for their objective. That's some scary shit.
By the way I am not trying to preach but have been someone with good mentorship and still made my own mistakes. @j-t-g that statement is so true. A buddy who has been doing this has has half a dozen friends die over 40 years of touring, big class 4s tearing out forests, falls in hidden crevasses, little sluff slide (class 1) and off the mountain you go....how do I count the ways nature does not give an F and is willing to kill you. Not all mistakes just exposure to risk by being there.
@nurseben stay safe man, really hope you do.
I happened to run into him in the parking lot later and chewed him out. He had no idea it was an unsafe place to be and had no idea he could have buried his son by dropping in right behind him.
I totally agree that tragic situations in the backcountry are more likely this year, but out of respect for the guy, don't group him in with a bunch of noobs. RIP Konan.
The accident I mentioned was in the spring near Louise. Newer skier on steep ice.
Did you see the images going around of the super gnar crust layers in Rogers? That looks like it will wreak havoc this year...
"But why?"
Desperate high income people who can not travel, highest demand ever for mtb products;
Massive price increase (boutique shops like forbidden up 10%, for example....);
Production explodes to answer demand;
Party ends, Bubble bursts, Massive hangover;
Cheap second hand high end bikes for all and return to normal.
B) On the front range, the used bike market bubble has already burst. 4 months ago you couldn't find a single bike for sale and those that were for sale were wayyyy overpriced. I just saw some bloke this morning getting torn to shreds for trying to sell his 2017 Hightower for $6k.
If there were certs for bike mechanics then maybe we'd actually get paid properly.
I'm busier than ive been and booked up until nearly next summer?
People seem to have more disposable income at the moment, I'm guessing from not being able to go out as much, no holidays etc.
I read an article about the cost of kids in Switzerland. If you have two of them it adds up to 540.000 Swiss francs untill they are 18. If you want to keep paying for them afterwards (e.g. college), this can go up to a million. So yeah, condoms have a pretty good return on investment...
I’d trade all my wealth for my kids and not even give it a second thought.
So “Mr Condom”, perhaps a call to your parents this morning, thanking them for raising a dick
*Laughs in American health care costs*
The cost of your average American birth, after insurance, is about 10K USD. It is, however, easier to push a baby out of one's body than a Yeti SB150, so at least there's that.
Just relax, no need for name calling. Fact is people without kids have more disposable income, so can spend a bit more on bikes. Enjoy your kids, I don’t want any but respect people who do.
In normal times folks wouldn't be shelling out this much money for bikes, despite all of the clever arguments suggesting they're not overpriced.
That's 19.7B in "New Taiwan dollar" is equal to 690 milion USD.
Just personal experience.
And trust my I had been a giant fan boy for the last oh I don’t know 15+ years.
Even had multiple earlier giant anthems, faith and glory’s. Last two year experience with carbon giants has been a pathetic joke.
I would assume those numbers should be treated with gran of salt
This next season will be interesting, I have seen tubes come into stock and disappear in seconds luckily I have plenty of Bell Wal Mart 26 inch tubes to hold me over, I am curious about our access to affordable parts and how that is going to look. Majority of our repairs are cheap bikes, it's not like I can upgrade them to GX on a $100 bike.
Good joke.