Companies

Under Armour reiterates its full year guidance

Aug 15, 2023 United States

The US-based company posted a solid first quarter in fiscal 2024, stressing the performances of the international and direct-to-consumer segments, and confirmed its previous full year guidance

“We're pleased with how we have navigated our start to fiscal 2024. 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. Based on this performance, we are maintaining our outlook for fiscal 2024”, Under Armour President and CEO Stephanie Linnartz commented.

First Quarter Results

In the first quarter of fiscal 2024, which ended on the 30^th of June, the company's revenue amounted to 1.3 billion US dollars, down by 2% (or 1% currency neutral) from the same period of last fiscal year.

In this period, the wholesale segment added 742 million US dollars to the total revenue, down by 6%, while the direct-to-consumer segment contributed 544 million US dollars, up by 6%, on a comparable basis to the first quarter of fiscal 2023; e-commerce accounted for 40% of the total direct-to-consumer segment revenue.

By region, Under Armour saw its revenue decline in North America by 9% in the first quarter of the current year, totalling 827 million US dollars, while its international revenue rose by 12%, reaching 485 million US dollars, on a comparable basis to the same period of the prior year; within the international business, the company's revenue increased by 10% in the EMEA region, 14% in the Asia Pacific region, and 13% in the Latin America region.

In the three months to the 30^th of June, the Baltimore-based company also posted a decrease of 5% in its apparel revenue to 825 million US dollars, but a growth of 5% to 364 million US dollars in its footwear revenue and 1% in its accessories revenue to 98 million US dollars, as compared to a similar period of fiscal 2023.

Under Armour's gross margin contracted by 60 basis points to 46.1% in the first quarter of the year from the same year-ago period, mainly driven by “higher promotions and adverse effects from changes in foreign currency, partially offset by supply chain benefits related to lower freight expenses”.

Additionally, the company's net income in the first three months of fiscal 2024 totalled 8.5 million US dollars, as compared to a net income of 7.7 million US dollars recorded in the same period of fiscal 2023. Diluted earnings per share were 0.02 US dollars in these periods.

Full Year Outlook

Given the performance of the first quarter, the company is still expecting its full year revenue to be flat to up slightly, and diluted earnings per share in the range of 0.47 US dollars to 0.51 US dollars.

Image Credits: about.underarmour.com

United States Companies Footwear Quarter Results Results Sportswear Under Armour