Supreme, the iconic streetwear brand, has been making headlines for years with its limited-edition drops and high-profile collaborations. But in 2019, the brand made headlines for a different reason: its nearly $1 billion USD operating profit in the first quarter alone. Here’s a closer look at what this means for the brand and the sneaker industry as a whole.
The Numbers
According to reports, Supreme’s parent company, The Carlyle Group, sold a 50% stake in the brand to VF Corporation for $2.1 billion USD in 2019. At the time of the sale, it was revealed that Supreme had generated nearly $500 million USD in revenue in 2018 alone. But it wasn’t until later that year that the full extent of the brand’s financial success was revealed.
In a report released in November 2019, Supreme announced that it had generated nearly $1 billion USD in operating profit in the first quarter of that year alone. The report showed that the brand had made $152 million USD in revenue in that quarter, with an operating profit margin of 69%.
The Impact
The news of Supreme’s financial success sent shockwaves through the sneaker industry. While the brand had long been popular among streetwear enthusiasts and collectors, the report showed that it was also a major player in the world of business and finance. The billion-dollar operating profit was a testament to the brand’s popularity and influence, and it solidified Supreme’s place as one of the most valuable streetwear brands in the world.
But the impact of Supreme’s success wasn’t just felt within the industry. It also had a cultural impact, as more and more people became interested in streetwear and its associated culture. The brand’s collaborations with high-profile artists and designers helped to elevate streetwear to a new level of sophistication and legitimacy, and it helped to broaden the appeal of the genre beyond its traditional fanbase.
The Future
So what does the future hold for Supreme? While the brand’s success has been impressive, it’s important to remember that the sneaker and streetwear industry is constantly evolving. New brands and trends emerge all the time, and consumer tastes can be fickle.
However, Supreme has shown that it has staying power. The brand’s ability to create hype and excitement around each new drop has helped to keep it relevant and popular for years, and its collaborations with high-profile brands and artists have helped to broaden its appeal even further.
In 2020, Supreme was acquired by VF Corporation, which owns a number of other popular clothing and footwear brands, including Vans and The North Face. This acquisition could help to further elevate Supreme’s profile and expand its reach, as it now has access to the resources and expertise of a larger parent company.
In conclusion, Supreme’s nearly $1 billion USD operating profit in the first quarter of 2019 was a major milestone for the brand and for the sneaker industry as a whole. It showed that streetwear and sneaker culture are more than just niche interests, but are legitimate business opportunities with global appeal. While the industry will continue to evolve and change, it’s clear that Supreme has established itself as a major player with staying power. Only time will tell what the future holds for this iconic brand.
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