Under Armour ekes out profit instead of expected loss as revenue tops estimates

By Ciara Linnane and James Rogers

Under Armour maintained its outlook for fiscal 2024

Under Armour Inc. blew past earnings estimates for its fiscal first quarter on Tuesday, posting a small profit instead of an expected loss, and said it was making no changes to the guidance provided in May.

The Baltimore-based sporting-goods retailer said it had a net income of $8.549 million, or 2 cents a share, for the quarter to June 30, up from $7.682 million, or 2 cents a share, in the year-ago period. Revenue fell to $1.317 billion from $1.349 billion a year ago. The FactSet consensus was for a loss of 2 cents a share and revenue of $1.294 billion.

Under Armour's wholesale revenue decreased 6% year-over-year to $742 million, and direct-to-consumer revenue increased 4% to $544 million due to a 6% increase in e-commerce revenue, the company said. North America revenue decreased 9% to $827 million, and international revenue increased 12% to $485 million.

Related:Under Armour's new CEO says women will be a key target customer

"Our international and direct-to-consumer businesses, both of which realized solid growth in the quarter, continue to deliver aside a challenging consumer retail environment in North America," Chief Executive Stephanie Linnartz said in a statement. "Based on this performance, we are maintaining our outlook for fiscal 2024."

The company's inventory was up 38% year-over-year to $1.3 billion, after rising 44% year-over-year to $1.2 billion during the prior quarter. Under Armour exited its fiscal first quarter with cash and cash equivalents of $704 million.

Under Armour said it is still expecting fiscal 2024 revenue to be flat to slightly higher and for EPS to range from 47 cents to 51 cents.

Related:Under Armour stock reverses lower as high promotions and discounts to continue as inventories keep rising

The class C shares (UAA) fell 0.4% Tuesday, while the class A shares (UAA) declined 0.5%, compared with the S&P 500 index's SPX 1.1% decline.

-Ciara Linnane

This content was created by MarketWatch, which is operated by Dow Jones & Co. MarketWatch is published independently from Dow Jones Newswires and The Wall Street Journal.

(END) Dow Jones Newswires

08-08-23 1140ET

Copyright (c) 2023 Dow Jones & Company, Inc.