Following a busy month of distribution reshuffles, Fox Factory has announced a record quarter of sales in Q3, with bike division sales up 8.8%.
Made up of Fox, Marzocchi, Race Face and Easton, the bike business is up 8.5% over the same results last year. The business as a whole notched up sales of $127.4 million in Q3, a rise of 16.9% over the same period in 2016.
As a result, guidance for the fiscal year has been raised, with sales expected to tally around $473.5 million, up from the formerly forecast $468.5 million.
“We are pleased to report another quarter of record sales and earnings results which exceeded our expectations. Our third quarter results reflect continued broad success across both our powered vehicle and bike businesses,” stated Larry L. Enterline, FOX’s Chief Executive Officer. “Looking ahead, our team remains committed to further building the FOX brand presence in our existing product categories and consistently pursuing new market opportunities.”
Gross margin was 33.4% for the third quarter of fiscal 2017, a 140 basis point improvement from gross margin of 32.0% in the third quarter of fiscal 2016. The improvement in gross margin was primarily due to favorable product and customer mix and improved manufacturing efficiencies. On a non-GAAP basis, adjusted gross margin increased 130 basis points, excluding the effects of acquisition related costs in the third quarter of last year.
Total operating expenses were $22.2 million for the third quarter of fiscal 2017, compared to $19.8 million in the third quarter of the prior fiscal year. The increase in operating expenses is primarily a result of strategic investments to support future business growth, increased incentive and stock-based compensation expense, and higher ongoing patent litigation-related expenses, partially offset by the conclusion of the Company’s acquisition-related compensation arrangements.
A full breakdown of the Q3 report can be found here.