1. What Happened? : DongIn Gear’s Q2 2025 Earnings Analysis

DongIn Gear reported sales of 62.1 billion KRW, operating profit of 4.8 billion KRW, and a net loss of 0.9 billion KRW for the first half of 2025. These figures fell short of market expectations, with a particularly sharp decline in operating profit and net income.

2. Why Did This Happen? : Reasons for the Earnings Decline

Several factors contributed to DongIn Gear’s disappointing performance:

  • Increased Competition in the Global Outdoor Market: This was the primary driver of declining sales in the bag ODM segment.
  • Foreign Exchange Volatility and Rising Interest Rates: These led to increased financial costs and foreign exchange losses.
  • Losses from Investments in Affiliates: Losses from equity method investments negatively impacted net income.

3. What’s Next? : Outlook for DongIn Gear

In the short term, easing foreign exchange volatility and interest rates, and growth in the company’s own brand business are key to improving performance. In the long term, the success of new businesses, such as the tent business, will be a crucial factor. However, uncertainties remain, including the possibility of a global economic slowdown.

4. What Should Investors Do? : Investment Strategy

A conservative approach is recommended for investing in DongIn Gear. Investors should closely monitor foreign exchange and interest rate trends, the performance of the company’s own brand business, and the progress of new businesses. Caution is advised, especially given the uncertain macroeconomic environment.