Revenue rose 1.5% to US$786.7 million despite flat shipment volumes of 27.5 million pairs. The company said performance was supported by strong demand from several Sports customers, alongside front-loaded seasonal volumes in its Casual segment. Average selling price increased 1.8% during the period, helping offset the lack of volume growth.
Profitability, however, came under pressure from higher raw material costs, operating deleverage at dedicated factories serving Stella’s largest Sports customer in China, and costs associated with its ongoing capacity expansion. Half-year net profit fell to US$63.6 million, compared with US$78.1 million in the first half of 2025, while operating profit stood at US$74.3 million.
Stella said 2026 remains an important investment year under its 2026–28 three-year plan, with new factories in Bangladesh, Indonesia and Vietnam progressing towards commissioning in the second half of the year, subject to customer certification and regulatory approvals. The company is also investing in R&D in Vietnam, including a new product development hub for footwear customers and a dedicated centre for a new Sports customer.
Looking ahead, Stella expects full-year 2026 shipment volumes to remain broadly flat amid heightened geopolitical and economic uncertainty, although forward order visibility remains solid. Its non-customer-exclusive facilities are expected to operate at close to full utilisation in the second half, while operating deleverage is expected to persist at dedicated factories serving its largest Sports customer in the PRC.
In July 2026, Stella also began a phased shutdown of smaller-capacity manufacturing operations in the Philippines after assessing their limited expansion prospects, allowing management to focus resources on regions offering stronger long-term returns.
Despite the pressures, the company maintained a net cash position of US$191.7 million. Stella also reaffirmed its commitment to returning up to US$60 million in additional cash to shareholders during 2026 through share repurchases and special dividends.
