Fiskars Q2 2025 slides: EBIT plunges 84% amid tariff challenges and U.S. market decline

Fiskars Group reported a steep Q2 2025 financial decline, with comparable EBIT collapsing 84% to €3.0 million and net sales falling 7%, primarily driven by significant U.S. market weakness and tariff impacts. This severe underperformance led the company to downgrade its full-year 2025 comparable EBIT guidance to €90-110 million, signaling persistent operational headwinds despite some growth in direct-to-consumer channels and China. The stock's proximity to its 52-week low reflects investor concern over the challenging outlook.

Analysis

Fiskars Group's Q2 2025 results revealed a significant deterioration in financial performance, driven by tariff-related headwinds and acute weakness in the U.S. market. The company reported an 84% year-over-year collapse in comparable EBIT to €3.0 million, with the corresponding margin contracting sharply to 1.2% from 6.8% in the prior year. This profitability crisis was compounded by a 7% decline in comparable net sales and a fall in free cash flow to €12.4 million from €49.3 million. The U.S. market, which constitutes approximately 30% of group sales, was the primary driver of the decline with a 14% drop in comparable net sales. In response to these pressures, management has revised its full-year 2025 guidance downwards, now expecting comparable EBIT of €90-110 million, which is below the €111.4 million achieved in 2024 and a reversal of its previous outlook for improvement. While there were pockets of strength, such as 12% sales growth in China and 4% growth in the direct-to-consumer channel, these were insufficient to offset the broader challenges. The divergence between the profitable Business Area Fiskars (15.1% EBIT margin) and the loss-making Business Area Vita (-2.6% EBIT margin) highlights significant internal performance disparities.

Key Decisions for Investors

• Given the severe earnings collapse and downward revision of full-year guidance, investors should anticipate continued pressure on the stock, as the company's mitigation strategies for tariffs are not expected to yield results until the second half of 2025.
• Monitor U.S. sales performance and retailer inventory levels closely, as this market is the primary source of the current weakness and will be a key indicator for any potential recovery.
• The rising net debt to EBITDA ratio, now at 3.16x, warrants scrutiny, as sustained pressure on earnings and cash flow could heighten financial risk and limit strategic flexibility.
• Pay close attention to the diverging performance of the two business areas, as any turnaround in the loss-making Vita division or sustained resilience in the Fiskars division will be critical to the investment thesis.