Trump administration’s unpredictable trade policies compelled footwear brand Skechers’to downcast its annual earnings forecast, causing the brand’s stock to decline by 7 per cent.

The company plans to reduce production in high-cost locations by diversifying their sourcing. From April 9, 2025, 38 per cent of Skechers' US sales originated from products made in China, as per a report by the Bank of America.

President Donald Trump has significantly increased import tariffs on Chinese goods to 145 per cent. These higher tariffs increase input costs for US companies with substantial Chinese manufacturing, ultimately leading to higher prices for American consumers.

The administration's inconsistent tariff policies are making it difficult for businesses to make long-term spending decisions, says David Weinberg, Chief Operating Officer, Skechers.

The current environment is simply too volatile to accurately predict results, he adds.

The company hopes to start experiencing significant effects from the current tariff situation at the end of the current quarter and ‘very sharply’ in Q3, FY25..

California-based Skechers also fell short of its Q1, FY25 sales expectations, growing by 7.1 per cent compared to the projected 7.9 per cent, according to data from LSEG.

The brand’s sales in China declined by approximately 16 per cent during the quarter ending March 31, as against the 11.5 per cent decline in the previous three-month period.

Along with other footwear manufacturers like Adidas, Nike, and Puma, Skechers has significant manufacturing operations in Asia, particularly China.

Several consumer goods companies, including PepsiCo, Procter & Gamble, and Kimberly-Clark, have also lowered their annual forecasts due to the increased supply chain pressures caused by tariff uncertainty.