Under Armour First-Quarter Earnings Missed Analyst Expectations
May 6, 2022 By MarketDepth
Under Armour (NYSE: UAA) reported first-quarter earnings that missed analyst expectations Friday, amid continuous supply chain disruptions as well as Covid lockdowns in China. Subsequently, the company disclosed a disappointing forecast for its fiscal year 2023. Shares tumbled over 25% during early morning trading, reaching a 52-week low of USD10.39.
Revenue Lower than Expected
The sports equipment company reported an earnings loss of USD0.01 per share, compared to the expected USD0.06 a share. Revenue amounted to USD1.3 Billion, slightly lower than analysts anticipated USD1.32 Billion. Furthermore, the company reported a net loss for the quarter of USD59.6 Million, higher than the previous year’s net income of USD77.8 Million.
“Having successfully executed a multi-year transformation and after delivering a record year in 2021 – we are continuing to serve the needs of athletes amid an increasingly more uncertain marketplace. As global supply challenges and emergent COVID-19 impacts in China eventually normalize, we are confident that the strength of the Under Armour brand coupled with our powerful growth strategy positions us well to deliver sustainable, profitable returns to shareholders over the long-term.”Under Armour President and CEO Patrik Frisk
Under Armour now expects to earn anywhere from USD0.63 and USD0.68 per share on an adjusted basis for the year, below analysts anticipated USD0.86. Additionally, the company believes sales will rise between 5% and 7% from the the previous year, while analyst had predicted a sales growth of 5.4%.
“Operationally, we remain concerned about a tightening of margins over the next few quarters. Should the top line growth predictions fail to materialize, perhaps because of a downturn in consumer sentiment, then profit erosion could become more serious.”Neil Saunders, an analyst at GlobalData