Azzas 2154 (AZZA3) Plummets Post-Earnings: CEO Downplays US Tariff Impact in 2025
Azzas 2154 (AZZA3) shares took a nosedive on August 8, 2025, after the company reported mixed Q2 results. While revenue growth slowed, EBITDA margins surprised positively due to cost synergies from its recent merger. CEO Alexandre Birman reassured investors that US tariffs on Brazilian footwear and bags WOULD have "no material impact," citing strategic shifts away from the US market. Analysts remain cautious, eyeing H2 performance for clearer signs of merger integration success. --- ### Why Did Azzas 2154 (AZZA3) Shares Drop 7.5%?
The stock of Azzas 2154 (AZZA3) tumbled 7.54% to R$35.08 on August 8, 2025, following its Q2 earnings release. Analysts labeled the results "neutral to weak," with revenue growth decelerating to 7.4% year-over-year (vs. 8.5% in 2024). Santander noted the slowdown was expected due to post-merger restructuring, but praised cost-cutting efforts that boosted EBITDA margins to 18.5% (+0.8pp). "The integration is messy, but the synergy savings are real," quipped one trader on TradingView.
### Merger Growing Pains or Hidden Strengths?The merger between Azzas and its unnamed counterpart (likely Arezzo, per historical context) created short-term chaos. Inventory levels ROSE 12%, and receivables swelled, but Santander highlighted a silver lining: "Expense optimization more than offset gross margin pressures from promotions." BTG echoed this, crediting "efficiency in SG&A costs" for keeping EBITDA in line with estimates. Still, Itaú BBA flagged a R$201.7 million financial loss from forex hedges and credit card fees—a 32.9% annual jump.
### US Tariffs: Much Ado About Nothing?CEO Alexandre Birman shrugged off concerns about US tariffs on Brazilian exports, calling the impact "well diluted." Only 8% of Azzas’ footwear/bag sales now go to the US (just 2% of group revenue). "We deliberately slowed US growth since 2023," Birman said, adding that a 30% price hike for Spring 2026 collections was absorbed "okay" by buyers. "We’re agile enough to offset uncontrollables," he asserted—a claim some analysts met with raised eyebrows.
### What’s Next for Azzas?All eyes are on H2 2025. The BBA team urged scrutiny of "rising product returns" and tariff knock-on effects, while Santander expects merger synergies to further lift margins. "The real test is whether Azzas can reignite top-line growth without sacrificing profitability," noted a BTCC market strategist. For now, the stock’s plunge suggests investors aren’t convinced.
--- ### FAQ SectionInvestor Q&A: Azzas 2154 (AZZA3)
How significant are US tariffs for Azzas?
Per CEO Birman, negligible—US sales now make up under 2% of total revenue after strategic pullbacks.
Why did EBITDA margins improve despite weak revenue?
Merger-driven cost cuts (e.g., streamlined divisions) outweighed promotional discounts and forex losses.
Is the stock drop an overreaction?
Debatable. Margins shined, but rising inventories and receivables signal potential liquidity risks (Source: TradingView data).
